Many companies are waiting. Waiting for the Italian implementing decree, waiting for more precise instructions, waiting for someone else to move first. Meanwhile, June 7, 2026 is approaching, bringing with it the first concrete obligation: responding to workers who ask for information about their own pay and about the average pay of colleagues doing equivalent work.
The EU Pay Transparency Directive 2023/970 is not just another rule to tick off a compliance checklist. It is an opportunity — perhaps the most concrete one in recent years — to bring order to something many organizations have long been putting off: truly understanding how much their roles are worth, and whether that value is recognized fairly, consistently and defensibly.
What it actually involves
The directive is already in force at the European level. In Italy, the Council of Ministers has begun examining a draft implementing decree that will transpose these obligations into national law. It applies to public and private employers, and covers all employees, including fixed-term executives.
The underlying principle is a single one: for equal work or work of equal value, any pay differences must be explainable and justified by objective, neutral criteria that are non-discriminatory in terms of gender. Put simply: same value, same pay for men and women.
The directive is structured around two levels of transparency:
Toward employees: every employee has the right to know the criteria used to determine their own pay, and the average pay levels, by gender, of those performing the same work or work of equal value.
Toward the outside world and authorities: employers with at least 100 employees are required to carry out periodic reporting on the gender pay gap. Companies with 250 or more employees, and those with 150–249, must be ready for their first report by June 7, 2027; for companies with 100–149 employees, the start date is postponed to June 7, 2031.
Even before hiring, companies will also be required to disclose salary ranges and average levels by role in job postings, and will not be allowed to ask candidates about their previous pay.
If a gender gap of 5% or more emerges that is unjustified and not corrected within six months, the company will have to launch a joint assessment with worker representatives and, under the draft Italian decree, involve the National Labour Inspectorate.
For many companies, grading will be the strongest answer
How can you tell whether you’re compliant? The company must first look inward: gathering and organizing data on roles, job levels and pay, and checking whether the criteria used to determine compensation, progressions and raises are genuinely clear, consistent and defensible.
In many cases, one of the most effective tools is putting in place a job grading system: a framework that analyzes roles, responsibilities, complexity and the skills required, in order to assign a relative value to jobs and build a more consistent, fair and transparent hierarchy.
Not all companies, at least at first, need a complete, analytical system. In many contexts it can already be very useful to start with job leveling: a lighter classification of roles into families and consistent levels, built from job content, responsibilities, degree of autonomy and operating context. It is not a detailed weighting, but an orderly, defensible foundation for beginning to reason about work of equal value and internal consistency. A pragmatic first step toward compliance, leaving the possible construction of a more structured grading system for a later stage.
Rigor and flexibility are not mutually exclusive
Davide Pellegatta, Senior Manager and People Practice Leader at Methodos — part of the Digital360 Group, comments: “It’s essential to have an objective job evaluation system, but the system must be correctly tailored to the company, its culture and its strategies. Rigor, yes, but with the flexibility needed to respect the organization’s identity. Relying on the national labor contract (CCNL) alone, which already defines a reference framework, is not enough to demonstrate equal pay or work of equal value: something more structured and tailored is needed.”
“The decree,” Pellegatta concludes, “is not just a regulatory constraint: it’s also an opportunity to bring clarity. It forces the company to spell out more clearly what a role actually requires, what growth path it can offer, and what criteria underlie pay, incentives and benefits. When these elements are clearer and more consistent, it improves not only compliance, but also the overall credibility of the HR system.”
An organizational change before it is a regulatory one
For all this to work, a technical system alone is not enough. The company must be willing to undergo genuine cultural change: a mindset that considers and values merit regardless of gender. HR and managers become agents of change, tasked with translating the rule into a substantial, tailored reality.
A path like this cannot be imposed from above. It must respect the organization’s change readiness and be co-designed. Evaluation factors can be anchored to the labor contract (competencies, responsibilities, commitment, working conditions) while also being translated into the company’s own language, whether it’s a tech company, a more plant-driven business, retail, or services.
The moment job grading stops being a compliance exercise and becomes a guide — for measuring performance, defining people’s development, and structuring reward and benefits — is the moment the work done acquires its full value.
Want to understand where your company stands?
Methodos and P4I Partners4Innovation have developed a Pay Transparency self-assessment that lets you quickly get a sense of your own level of readiness in about 10 minutes.
At the end, you can request a follow-up call to discuss the results and define operational priorities.