Pay Transparency Directive deadline passed – what companies must consider

Germany failed to meet the June 7, 2026 deadline for transposing the EU's Pay Transparency Directive (Directive 2023/970) into national law. No draft bill has been presented, and an amendment to the existing Pay Transparency Act is now expected in early 2027.

This failure to implement has created a period of legal uncertainty for employers. The directive's provisions already have direct effect on public sector employers, who must now review their pay structures for potential disparities and ensure transparent recruitment processes.

For private employers, the directive is not directly applicable until national law is enacted. However, courts are obliged to interpret national laws consistently with the directive, and case law has been shifting to strengthen employees' positions regarding pay differences.

The directive's core requirements include recruitment transparency, enhanced information rights for employees, regular reporting obligations, and easier enforcement of claims for damages in cases of indirect discrimination. Companies are advised to use the interim period to review their remuneration practices and prepare for the directive's implications.