Directive (EU) 2023/970 on pay transparency: duties at recruitment, the right to information, reporting thresholds and the gender pay gap. A guide for SMEs.
Translated from Romanian. This article covers Romanian labour and tax law; the Romanian version is canonical and is updated first.
Pay secrecy is coming to an end across the whole European Union. Directive (EU) 2023/970 to strengthen the application of the principle of equal pay for equal work or work of equal value between men and women through pay transparency and enforcement mechanisms — the Pay Transparency Directive — adopted in May 2023, requires employers to communicate pay levels openly, to justify differences between women and men and to report the gender pay gap periodically. The deadline by which member states, Romania included, must transpose the directive into national legislation is 7 June 2026.
Even though, at the date this article was published, the final form of the Romanian transposing law was not yet in force, the substantive obligations of the directive are clear. For an SME owner or HR manager, preparation starts now — not on the day the law appears.
The directive does not refer only to basic salary. It covers all forms of pay: fixed salary, variable components (bonuses, commissions, performance premiums), allowances, vouchers, contributions and other benefits paid directly or indirectly, in cash or in kind. When you analyse whether two employees are paid fairly for “the same work or work of equal value”, you have to weigh the entire package, not just the figure in the contract.
The most visible changes appear at hiring. The directive requires:
In practice, every job advert will have to be restructured so as to include a pay scale and clear criteria for differentiation.
Any employee can ask the employer for information about their own pay level and about average pay levels, broken down by gender, for the categories of workers performing the same work or work of equal value. The employer must respond in writing, within a reasonable time, but within two months at most of the request. In addition, employers are obliged to inform all employees annually that they have this right.
Confidentiality clauses that prohibit employees from discussing their pay become, in principle, prohibited.
The directive introduces periodic reporting of the gender pay gap, in stages, depending on the size of the organisation. According to the provisions of the directive, the timetable is:
Below 100 employees, reporting is not mandatory under the directive (member states can go further when transposing — check the value in the final Romanian law). The report must contain, among other things, the mean and median gap between women and men, the gap in the variable components, the distribution of workers across pay bands and the gap by comparable categories of positions.
This is where the essence of the mechanism lies. If reporting shows a gap of at least 5% in a category of workers performing work of equal value, and the employer cannot justify it on objective and gender-neutral criteria, a joint pay assessment together with employee representatives is triggered. The outcome must be a concrete plan to remedy the difference.
An important detail: the 5% threshold applies to each category of workers, not to the average of the whole company. Even if the overall gap is small, a single category above 5% activates the obligation.
A company has 10 developers — 6 men with an average salary of 9,000 lei and 4 women with an average salary of 8,400 lei. The gap is (9,000 − 8,400) / 9,000 = 6.7%. Above the 5% threshold. If the difference cannot be explained by seniority, skills or other documented and neutral criteria, the company must initiate the joint assessment and a correction plan.
The directive shifts the burden of proof onto the employer. If an employee presents facts in court from which pay discrimination can be presumed, it is the employer who must prove that it did not discriminate. Without clear pay scales and documented objective justifications, companies risk losing these cases. Employees can claim pay differences for a retroactive period.
Member states must provide for “effective, proportionate and dissuasive” penalties, including fines, with aggravating circumstances for repeated breaches. The specific levels of the fines will be set by the Romanian transposing law.
A study published by SD Worx in May 2026 shows that only 47% of organisations in Romania were fully aware of the requirements of the directive, just a few weeks before the transposition deadline. In other words, more than half of employers risked entering the new regime unprepared — without a documented pay scale and without the capacity to produce the required reports.
If your company reaches the reporting thresholds, this gap is an opportunity: preparing in advance means less pressure than compliance done up against the deadline.
The hardest practical part of the directive is the figure: knowing, at any time, what the gender gap is for each category of positions and being able to justify it. What matters here is that the data is already structured, not scattered. In Workly, basic salary, allowances, variable components, gender and job category sit in the same records, and the report generator allows you to build a report that combines them — so the calculation base for the gap comes out of the system, not from adding up separate tables by hand. A predefined pay gap report, ready to file, does not exist yet — for now you configure it from the available fields.
In addition, defining transparent and neutral pay criteria in the system gives you exactly the documentation you need if a request for information or a dispute arises. For SMEs approaching the reporting thresholds, it is the difference between orderly preparation and a marathon of spreadsheets.
Informational article, accurate at the date of publication. Not legal or tax advice. The Romanian law transposing Directive 2023/970 may set its own thresholds, deadlines and penalties — always check the final form at source (Monitorul Oficial, EUR-Lex) or with a specialist.
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