Salary transparency law: key points, obligations and deadlines

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La Salary transparency has gone from being a taboo subject It will become a legal obligation that all companies will have to take very seriously. The future pay transparency law, stemming from European Directive 2023/970, will require changes in how salaries are set, how job offers are published, and how internal promotions and raises are managed.

This regulatory change implies a before and after for equal pay between women and menCompanies will have to thoroughly review their compensation structure, document objective criteria, make salary information available to their staff, and justify any significant differences between workers performing functions of equal value.

What is the salary transparency law and what is it based on?

The call The salary transparency law is the transposition into Spanish law of Directive (EU) 2023/970 of the European Parliament and of the Council, adopted on 10 May 2023. Its main purpose is to strengthen the principle of “equal pay for equal work or work of equal value” between women and men in all Member States.

This European regulation It is not created from scratch, neither in Spain nor in the European UnionThis initiative has been developing for years as a response to a gender pay gap that is barely narrowing. In the EU, the average difference is around 13%, while in Spain, the latest data from the Annual Wage Structure Survey indicates that women earn an average of about 5.212 euros less per year, representing a gap of approximately 18,36%.

In our country, the directive It is linked to existing regulations such as Royal Decree-Law 6/2019 on equal treatment, Royal Decree 902/2020 on equal pay, and Organic Law 3/2007 for effective equality between women and men. It also relies on Article 28 of the Workers' Statute, which establishes the obligation to pay the same for work of equal value.

The new thing is that they are now established much more demanding transparency mechanisms, detailed information obligations, reinforced rights for employees and a reporting and sanctions system that puts the focus on the company: it will be the company that must prove that there is no wage discrimination.

Key objectives: what is the real aim of pay transparency?

The ultimate purpose of the directive is closing the gender pay gapBut to reach that point, it sets a series of more concrete objectives that companies must keep in mind when adapting.

First, the regulations seek guarantee equal payso that two people who perform work of equal value - even if they do not have exactly the same position - receive equivalent remuneration, including base salary, supplements and extra-salary payments.

Furthermore, it is intended to promote a genuine culture of salary transparency within organizations. This means that relevant information about salaries, pay scales, progression criteria, and bonuses will no longer be reserved exclusively for management or Human Resources and will be accessible to staff and their representatives.

Another pillar is the empowerment of workersAccess to clear data on pay levels and what is taken into account to earn more or be promoted strengthens their negotiating power and their defense against possible discrimination.

Finally, the law seeks to prosecute create fairer, more competitive and bias-free work environmentswhere key decisions such as hiring, salary increases or promotions are based on objective criteria related to the position, performance or responsibility, and not on factors such as gender, age or "unlimited" availability.

Context: situation in Spain and implementation schedule

At the European level, the directive states that Member States must transpose it into their national law by 7 June 2026From that moment on, a staggered schedule will begin to be implemented, depending on the size of the company, to apply the reporting and compensation evaluation obligations.

In Spain there is already a significant regulatory framework regarding equality, but The new regulation requires going much further.The mandatory pay register since 2021, salary audits linked to equality plans and other existing instruments will form the basis on which the new system will be built.

According to the planned schedule, The effective entry into force of the heavier obligations will be gradual.Companies will have to adapt according to their workforce, with ample timeframes for medium and small organizations, although all must comply with certain measures from the outset, such as transparency in job offers and the right to access salary information.

Experts recommend that companies, and especially HR and compensation departments, Don't wait until the last minute to review your compensation systemAdaptation requires changes in policies, processes, information systems, internal communication and, above all, in corporate culture.

Who is affected by the salary transparency law?

The European directive and its future transposition in Spain They reach practically the entire productive fabricIt affects public and private entities, large corporations, SMEs, micro-enterprises and also the public administration, although the degree of obligation varies according to size.

Overall, all companies operating in Spanish territory They must respect the principles of equal pay and transparency, apply objective and neutral criteria in salary matters and allow the exercise of new information rights.

Furthermore, the standard is aimed at all working people and also to those who participate in selection processesCandidates, employees, legal representatives of the workforce, and labor authorities will be impacted by the new way of understanding remuneration.

In the public sector, the law reinforces the principle of publicity and transparency of remunerationPromoting clear and comparable salaries in the administration, and ensuring that differences are justified by objective factors such as level of responsibility, corps or professional scale.

It is worth noting that, although smaller companies will be exempt from some periodic reporting obligations, They are not exempt from transparency in job offers nor the individual right of access to remuneration information by its staff.

Key dates and adaptation deadlines by company size

One of the issues that most concerns companies is when they need to have everything readyThe directive establishes a scheme for progressive implementation which, in the Spanish case, is structured in several time milestones starting from June 7, 2026.

From that date, The rule will begin to take effectHowever, full compliance with reporting obligations on the gender pay gap will have different timeframes depending on the size of the workforce. Organizations with more than 250 employees will have one year to adapt; those with between 150 and 249 employees, two years; and those with between 100 and 149 employees, a longer period extending until 2031.

Companies with fewer than 100 employees They will not be required to submit periodic reports on the gender pay gap to the competent authority, unless the Spanish legislator decides to broaden the scope, something that the directive allows each Member State to determine.

However, even in these smaller organizations, Key obligations will remain in force such as the inclusion of salary bands in offers, the prohibition of asking about salary history, the elimination of remuneration confidentiality clauses and the right of access to salary information averaged by sex and category.

In summary, the schedule allows for a gradual adaptation, but the reality is that All companies should start reviewing their compensation policies as soon as possible. if they don't want to be overwhelmed when the law is fully operational.

General obligations for companies: transparency and access to information

The backbone of the new regulations is the demands for remuneration transparencywhich translate into both external information obligations (job offers) and internal obligations (employees and representatives).

First, companies will need to display the salary or salary range in job postings Or at least inform them of it before formalizing the contract. The practice of publishing vacancies without any mention of salary or waiting until the end of the process to discuss money is over.

During the selection processes, the following is also established: prohibition on collecting data on salary history of the candidates. It will not be possible to ask how much they earned in previous positions or to condition the offer on them providing that information, thus avoiding perpetuating previous inequalities.

On the other hand, working people will have right to request information on average pay levels of those who perform the same job or one of equal value, broken down by sex. This information will include base salary, bonuses, extra-salary payments and other remuneration items.

The company must also provide, upon request, the objective criteria used to determine salaries and their evolutionas well as for the allocation of bonuses and career progression. These criteria must be gender-neutral, documented, and consistent with actual practice.

The information must be submitted in writing, at no cost to the employee and within a reasonable timeFurthermore, reprisals or any unfavorable treatment towards anyone who exercises these rights or reports possible inequalities are expressly prohibited.

The end of salary confidentiality clauses

One of the most striking changes brought about by the directive is that Companies will no longer be able to shield salary information. through confidentiality clauses in employment contracts or internal regulations.

These types of clauses, which have been very common until now, They prevented colleagues from openly discussing salaries. and made it very difficult to detect irregularities. The new regulation considers that the imposed silence on remuneration fosters discrimination, especially against women.

Once the law is fully implemented, the staff must be able to share information about their salaries, bonuses and economic conditions without fear of disciplinary sanctions or negative consequences in their professional career within the company.

This does not mean that the organization has to publish the individual salary of each person with their full names publicly available, but it does mean that It will not be able to prevent communication between workers nor to take refuge in confidentiality to deny aggregated and disaggregated data by sex and professional category.

Eliminating these enforced silences aligns with the idea that Only with real transparency can pay gaps be identified and corrected. which go unnoticed today precisely because nobody knows what the person next door earns.

Gender pay gap reports and joint pay assessments

Beyond internal and external transparency, the directive introduces a system for periodically reporting the gender pay gap for medium and large companies, in order to monitor and correct pay differences between women and men.

Organizations with more than 250 employees will need to prepare and submit annual reports on their remuneration situation, breaking down the average salary difference between both sexes, by categories or groups of positions of equal value, and providing sufficient information to detect possible imbalances.

Companies with between 100 and 249 employees will have to to submit these reports every three yearsMaintaining the same level of detail, but less frequently to alleviate the administrative burden.

The standard establishes a very clear threshold: if the pay gap exceeds 5% between women and men who perform work of equal value and the company cannot justify it by objective and neutral criteria (for example, seniority, measured performance, additional responsibilities), the obligation to carry out a joint remuneration evaluation will be activated.

That evaluation will be done in coordination with the legal representatives of the workersIt must thoroughly analyze the professional classification systems, the salary allocation criteria and the reality of the positions, and must be completed within a maximum period of six months from the submission of the report where the gap was detected.

If the unjustified differences are not corrected after that process, the company may face corrective measures imposed by the labor authority and economic sanctions relevant, in addition to individual claims from the affected workers.

Pay register, equality plans and other mandatory tools

The upcoming salary transparency law doesn't come alone: It strengthens and expands instruments that are already mandatory. for many companies, especially in Spain.

The first is remuneration recordThis document, mandatory since 2021 for all companies regardless of the number of employees, must include all salaries, bonuses, and extra-salary payments for the workforce, broken down by gender and professional groups, categories, or positions of equal value.

With the new regulations, registration ceases to be a mere formality and becomes a key piece for detecting inequalities and justify objective differences, as well as feed into future pay gap reports required by the directive.

The second instrument is the equality plansThese plans are mandatory in Spain for companies with more than 50 employees. They must include a diagnosis of the company's situation, specific measures to correct imbalances, and, very importantly, a pay audit that closely analyzes salary policy from a gender perspective.

The salary transparency directive It is integrated with these equality plans, reinforcing existing obligations and adding layers of control, monitoring and accountability, so that equal pay ceases to be a mere commitment of good intentions and becomes a verifiable practice.

To meet all these requirements, many companies are already turning to Specialized technological solutions for payroll and HR managementwhich allow for automated registration, cross-referencing of data, detection of gaps, simulation of corrective scenarios, and generation of reports for authorities and internal committees.

Sanctioning regime: economic and legal consequences of non-compliance

One of the aspects that most worries organizations is the sanctions regime associated with salary transparencyAnd with good reason: the fines can be substantial and have additional effects beyond the immediate economic impact.

In the Spanish context, failure to comply with obligations regarding equal pay and transparency can lead to fines ranging from 626 euros to 225.018 eurosDepending on the severity, recurrence, and size of the company, very serious infractions, especially those involving systematic wage discrimination, will be placed at the higher end of the scale.

In addition to administrative penalties, companies may be forced to to compensate workers who have suffered discrimination, paying back wages, regularizing supplements or benefits in kind and compensating for other economic damages resulting from inequality.

It should not be forgotten that non-compliance can also have reputational and contractual consequencesSanctioned companies may lose access to subsidies, public aid and bonuses, and may even be temporarily excluded from contracting with the administration.

A key point of the directive is the reversal of the burden of proofWhen a worker alleges wage discrimination, they will no longer have to prove it themselves, but rather the company will have to prove that the difference is based on objective, measurable and gender-neutral criteria.

New rights for workers regarding remuneration

The regulatory change not only increases business obligations, but also It significantly strengthens individual and collective rights. of those who work in the organization.

Any employee will have the right to to know their individual compensation level with complete clarity, including all items that are part of your compensation, from base salary to bonuses, variables and extra-salary benefits.

In addition, you can request information on average salary levels of those who perform the same work or work of equivalent value, broken down by gender. This will allow us to detect, for example, if women are systematically paid less than men for the same type of position.

The right to access the criteria used to set wagesThe requirements for obtaining bonuses or allowances and the conditions for career advancement must be clear, accessible, and written in understandable language, without ambiguity.

Those who are expressly protected are also protected. They exercise these rights or denounce situations of inequalityAny retaliation, such as unfavorable treatment, blocking promotion, or disguised dismissal for requesting salary information, may be considered discriminatory and void.

Taken together, these rights aim to ensure that the workforce no longer operates blindly regarding salaries and can Compare objective data with the reality of your payrollThis will increase the pressure to correct injustices that previously went unnoticed.

Changes in selection processes and employer branding

The directive also has a direct impact on the the way in which offers are designed and selection processes are managedforcing companies to provide more information and avoid certain traditional practices.

From the point of view of the content of the offers, it will be mandatory Include the starting salary or, at least, the salary range. applicable to the position. This information may appear in the advertisement itself or be provided by other means before the hiring is formalized, but it can no longer be left up in the air until the last moment.

Similarly, asking questions about the candidates' compensation historyThis applies to interviews, forms, and selection tests. The offer should be based on the value of the position and the candidate's qualifications for that role, not on their previous salary.

Another relevant aspect is that job descriptions and vacancy texts must use gender-neutral languageavoiding terms, expressions or requirements that may be exclusionary or generate indirect biases against women or other groups.

All of this will have an impact on the employer branding strategiesCompanies that commit to salary transparency from the outset, publishing clear ranges and progression criteria, will have a competitive advantage when it comes to attracting talent compared to those that resist opening up their compensation policies.

Furthermore, this transparency will contribute to much more balanced wage negotiations, both in the selection process and in internal reviews, avoiding the unjustified differences that arise when only one party has all the information.

Advantages for companies and employees of getting ahead of the standard

Although at first glance the new regulation may look like one more administrative burdenThe truth is that it also offers very interesting opportunities for those who decide to get ahead.

For the staff, transparency translates into greater motivation, sense of fairness and confidence within the organization. Knowing that there are clear and objective criteria for earning more, getting promoted, or accessing certain bonuses reduces rumors, mistrust, and the feeling of arbitrariness.

From a business perspective, anticipating the law allows to detect and correct potential salary imbalances in a timely mannerThis avoids internal conflicts, lawsuits, or future sanctions. It is simpler and less costly to act proactively than to react to inspections or complaints.

Well-managed pay transparency can also Improve corporate reputation and the ability to attract and retain talentMore and more professionals value fairness, diversity, and honest pay, and do not hesitate to rule out companies that are opaque or have a bad reputation in this area.

Finally, a clear and consistent compensation system is usually accompanied by more organized internal processes and better documented decisionsThis facilitates performance management, career planning, and alignment between people strategy and business objectives.

How to prepare: compensation audit and HR process review

To adapt successfully, companies need a structured and planned approachthat it not be limited to "filling out paperwork", but that it review the salary policy from its roots.

The first step is to make a comprehensive audit of the current compensation systemThis involves analyzing the salary register, reviewing all the items that make up the compensation package, checking how salaries have been set, and studying whether there are patterns of gaps between women and men in comparable positions.

That audit should also review professional classification systems, job descriptions, the factors taken into account to assess the position (responsibility, complexity, impact, working conditions, etc.) and how they are applied in practice to avoid indirect gender bias.

Next, it is advisable define or update salary policiesThis includes establishing salary bands by levels and categories, as well as objective and measurable criteria for setting salaries, granting bonuses, internal promotions, and raises. All of this must be properly documented and aligned with equality regulations.

The company must also To train managers, middle managers and Human Resources teams in the new regulations, in transparency management and in bias prevention, since they will be the ones who apply the remuneration criteria on a daily basis and who have to explain to the staff how they work.

Finally, it is key to review and adapt the selection processes, performance evaluation and promotionRedefining offer templates, interview protocols, and decision-making processes so that salary transparency becomes a natural part of the employee's journey from application to career development.

The role of technology and payroll and HR software

Given the volume of data and the complexity of the analyses required, Technology becomes an indispensable ally to comply with the new salary transparency regulations without going crazy.

Current payroll and HR management solutions allow centralize all pay information and payroll management, keep it updated in real time, generate salary records, automatically detect possible gaps and prepare customized reports for internal committees or authorities.

Many of these tools incorporate modules for HR Analytics or compensation dashboards that make it easier to visualize salary differences by sex, age, category, workplace or any other criterion, which helps to quickly identify critical points and design corrective measures.

In the market there is a wide offer of specialized software for payroll and human capital It adapts to different sizes and sectors: from very robust solutions for large corporations to simpler and modular tools for SMEs, with functionalities such as time registration, document management, absence control, employee portals or integration with ERP and CRM.

Selecting the right solution not only allows automate processes and minimize errorsbut it also helps to demonstrate to inspections or audits that the company has a solid, transparent system aligned with legal requirements, which reduces risks and conveys confidence.

The arrival of the salary transparency law will force companies to confront their compensation practices head-on. put order where there was previously opacity. Turning this obligation into an opportunity to build clearer, fairer, and more competitive salary systems can make the difference between experiencing the new regulations as a problem or leveraging them as a tool for improvement and enhanced reputation in the labor market.