Same job, same pay. New European rules will change wages in the Czech Republic

What the Transparent Remuneration Directive brings and why it was created

The European Pay Transparency Directive has an ambitious goal: to eliminate (or at least significantly reduce) inequalities in pay between women and men for equal work or work of equal value. Although equal pay has been enshrined in European and national legislation for decades, practice still lags behind. The problem is, among other things, that employees often do not have enough information to be able to detect and defend themselves against unequal treatment.

According to Eurostat data, the difference in average gross hourly wages between women and men in the EU is around 13%. The Czech Republic is even worse off – in the long term, it is one of the countries with the largest gap, which is around 16%. For some occupations or age groups, the gap is even more pronounced.

The Directive therefore provides concrete tools to detect and eliminate inequalities. It emphasises greater transparency in recruitment, allows employees to request information on pay levels and forces companies to regularly analyse and report on pay gaps. It also introduces an important change in the burden of proof – if an employee believes they have been discriminated against, the company must prove otherwise.

When the changes will affect Czech employers and who will have to comply with the rules

EU Member States have until 7 June 2026 to implement the new Transparent Remuneration Directive into their legal system. By then, the Czech Republic must also adopt the necessary changes to the Labour Code and other regulations. However, it is already clear that medium and large companies will feel the biggest impact.

Employers with more than 250 employees will be the first to be affected by the new rules, starting in mid-2027. But the European Directive also encourages Member States to include smaller employers on a voluntary basis.

Larger companies will be obliged under the rule to report regularly on the gender pay gap and to carry out a pay audit if there is a significant difference (more than 5%). This is to identify the causes of the differences and propose corrective measures. If they fail to do so, they face penalties to be determined by each country. The inspection powers of labour inspectorates will also be tightened.

For employers, this means not only a new administrative burden, but also the need to revise payroll systems and internal procedures. But good preparation can help companies avoid problems – and gain an advantage in the labour market.

More administration and risk of sanctions. But also an opportunity to improve company culture

In addition to the obligations already mentioned, it will be essential for employers to introduce objective and transparent pay criteria that clearly define what merits a raise and who deserves a promotion. This will add to the administrative burden for companies. From the employees’ point of view, however, there will be an opportunity for greater order and fairness in remuneration.

At the same time, it is a chance to strengthen employee confidence, reduce turnover and improve company culture. A transparent approach to pay can make a company an attractive employer – and not just on paper.

Plus, there are also penalties – companies that break the rules or try to circumvent them can face fines, lawsuits and reputational damage.

What the new rules mean for employees

The new rules on transparent remuneration give employees greater visibility of how their work is being rewarded – and more importantly, the ability to defend themselves against unfair treatment. Already at the recruitment stage, candidates will have the right to know the salary or wage range for a given position, even before the interview itself.

Employers will not be able to use the “you name it, you get it” tactic that often disadvantages women or less confident candidates.

Employees will also have the right to ask their employer for information about their pay and how colleagues of the opposite sex who do the same or comparable work are paid. This will give them a better chance of uncovering any differences that have remained hidden until now.

The reversal of the burden of proof is also a major change. If an employee brings a claim for unequal pay, they will not have to prove that they have been discriminated against. On the contrary – the company will have to prove that it acted fairly and objectively.

Overall, the directive thus empowers employees and puts tools in their hands that can actually lead to fairer wages – regardless of gender.

Wage equalization or just cosmetic adjustments? Is there a risk of circumventing the rules?

Although the EU Transparent Remuneration Directive promises a more level playing field, there are critical voices. Some experts warn that there is a risk of circumvention of the rules – for example, through variable pay components such as bonuses, premiums or benefits. Companies may thus maintain equality on paper, but the real pay gap remains hidden. This is why the Directive requires that not only base salaries but also total remuneration should be reported.

The next question is how employers themselves will approach the new rules. While in some Western European countries equal pay has been a long-standing issue and companies are actively pursuing it, in the Czech Republic there is rather reticence. There is often concern about the administrative burden or distrust of mandatory disclosure of sensitive data.

Trade unions and labour inspectorates have a key role to play. They should help employees to assert their rights and at the same time ensure that companies actually comply with the rules – not just formally. If the directive can be put into practice properly, it can make a real contribution to equalising wages. If not, the changes risk becoming cosmetic – and confidence in the whole system will suffer.

Summary

In conclusion, the European Transparent Pay Directive is not just a formality, but a major step towards a fairer working environment. It introduces tools that can really help to eliminate pay inequalities – if well and fairly applied. For employees, this means greater certainty and the ability to claim fairness; for companies, it means a challenge but also an opportunity to improve company culture and workplace relations. The result could be an environment where ‘equal work, equal pay’ is no longer just a phrase.