The EU Directive 2023/970 on pay transparency is now a reality: the transposition deadline for Member States expired on June 7, 2026, and, for companies with at least 150 employees, the countdown to the first mandatory reporting in 2027 has begun.
Even from the first working drafts, an awareness emerges that overturns the usual priorities: before even addressing how to calculate pay and pay levels, you need to understand how to build the basis for comparability — that is, work of equal value. Without an operational definition of which roles are comparable to one another, any pay calculation in fact rests on unstable ground.
THE CASE STUDY
To better illustrate this shift in paradigm, let’s look at the example of a manufacturing group with more than 800 people.
The starting point was a fairly common situation: years of steady growth had produced a proliferation of job titles, similar roles called by different names (and vice versa), naming conventions layered over time, and a non-systematic correspondence between role, level and pay, the result of adjustments, acquisitions and non-linear career paths.
It therefore became necessary to restructure the role system with a view to simplification, greater internal consistency and solidity. An initial analysis revealed two critical issues that, in different forms, are found in almost every company going through this process.
- The impossibility of relying on the national labor contract (CCNL) alone. This is the most obvious shortcut: using the contractual classification to identify “work of equal value”. The problem is that within the same level there coexist roles with very different content, responsibilities and pay markets, and the directive requires comparing pay specifically between jobs of equal value, not generically between identical contractual classifications. The practical consequence was clear: it was necessary to build homogeneous bands within the same CCNL level.
- Same role, multiple classifications. Analysis of the distribution of roles revealed extreme cases: the same type of role (for example “Manager”) was classified at multiple different contractual levels. When this happens, the level stops reflecting the value of the work, and instead represents the outcome of individual histories, negotiations and customary practice. Every pay discrepancy then becomes costly to explain and defend.
THE METHODOLOGY: 3 PHASES, FROM DATA TO ALIGNMENT WITH THE BUSINESS
The path toward greater consistency was organized into three phases, with the aim of arriving at a usable minimum viable product faithful to the organization’s reality.
Phase 1 — Review of the role system. The starting point is existing materials: HR databases, org charts, job families, pre-existing models. The key methodological step in this phase is identifying role types: homogeneous groupings of roles similar in macro-content or expertise (for example, AFC Specialist), useful for working on clusters rather than individual roles (Accounting Specialist, Tax Specialist, etc.) and for identifying job levels and pay with a sharper perimeter. Cases are then identified in which, due to misalignments in duties, classification or pay, a different role type must be assigned (for example, from AFC Specialist to AFC Expert), taking care to avoid the risk of demotion (where necessary, this is addressed during the exception-handling phase).
Phase 2 — Stakeholder listening. The role types are tested through workshops dedicated to function heads, to identify issues, make necessary adjustments, and verify internal consistency through three steps: an overview of the distribution of role types by level within the job family; the identification of any clusters of work of equal value that cannot be grouped into a single role type (for illustrative purposes only, Finance Specialist and Administration Specialist); and a “light” weighting of the role types according to criteria that are shared, objective and gender-neutral.
Phase 3 — Alignment for Pay Transparency. With the system in order, it is possible, if necessary, to carry out calibration across departments and then proceed with the analysis: pay positioning for comparable groups, identification of outliers, and any inconsistencies between pay and level. To complete the design, guidelines for managing exceptions and setting up governance of roles and role types: the system must remain alive and consistent, to avoid the risk of it degrading over subsequent hiring cycles, salary reviews, and so on.
Lessons learned
Three main lessons emerge clearly from this process. The first: compliance with directive 2023/970 is not a reporting exercise, it is an exercise in organizational architecture. The second: the CCNL level is the starting point, not the destination; work of equal value must be built within contractual levels, using objective, gender-neutral criteria. The third: involving the various functions is not a courtesy step, it is what makes the model consistent and accepted.
Key benefits
The main benefits of adopting this methodology, beyond achieving compliance with Pay Transparency regulations, are:
- enabling the analysis and classification of roles even in the absence of a grading system or a structured job architecture model;
- ensuring greater consistency between job titles and the work people actually perform;
- minimizing the impact on the classification system and on pay, intervening only where strictly necessary;
- ensuring compliance through a pragmatic, lightweight approach that is easy for the organization to manage;
- meeting regulatory requirements without building overly complex or oversized HR structures and processes.
A FIRST STEP, NOT A DESTINATION
What we have described corresponds, in effect, to the first steps of a broader journey: once the foundations have been laid (Foundations) and legal requirements secured (Compliance), including in terms of information processes toward employees, it is possible to move on to Adoption & Integration, that is, reinforcing the model and its internal adoption, with tools, communication and managerial capability that ensure its effectiveness and continuity over time. Finally, Positioning, where the process stops being a compliance exercise and becomes a reputational lever, strengthening the organization’s positioning on transparency, fairness and inclusion.
The good news is that you don’t need to decide everything at once: each step creates value in its own right, and every company can stop or start again from whichever level best meets its own goals.
Want to understand how to best manage this change in your company?