EU pay transparency directive: current state and next steps

The EU pay transparency directive is set to fundamentally change how organizations approach reward, pay equity, and people governance. It introduces far‑reaching obligations for employers around pay disclosure, gender pay gap reporting, and the use of clear, objective, and gender‑neutral pay‑setting and progression criteria. At the same time, it significantly strengthens the rights of employees and candidates to access pay information. Together, these measures are intended to make pay practices more transparent, reduce unexplained pay gaps, and support a more equitable labor market across the EU.

The directive must be transposed into national law by 7 June 2026. With less than 100 days to go until that deadline, organizations across Europe, and in Belgium, are entering a period of significant change and, for many, considerable uncertainty.

Some Member States have already published draft legislation or shared concrete implementation plans, while others have indicated they will not meet the deadline. In Belgium, existing rules on the gender pay gap offer a solid starting point, but the full contours of how the directive will be implemented in practice are still taking shape.

This is therefore an appropriate moment to take stock. In what follows, we outline where things currently stand, what is still to come from a regulatory and practical perspective, and how employers can already start preparing, not only to comply with new rules, but also to strengthen pay governance, transparency, and culture.

Belgium presents a particularly nuanced picture. Foundational legislation addressing the gender pay gap has been in place for more than a decade, notably the law of 22 April 2012^[i]. This framework already embeds the principles of equal pay and non‑discrimination, but the directive will require further steps, particularly on transparency and enforcement.

In February 2025, the BE‑MAGIC project was launched to support social partners in sector‑level negotiations on pay structures. A key conclusion of the second work package of the project is that, despite an already dense legal framework on equal pay, the directive will still require adjustments to transparency, enforcement, and the design and monitoring of sectoral systems, while safeguarding the autonomy of social partners. The third work package has just started, focusing on mapping existing sectoral classification and evaluation systems, as well as other pay‑related benefits, from a gender‑neutral perspective.

On the public‑sector side, implementation is somewhat advanced. The Flemish Government approved, at the end of 2025, a draft decree that partially implements the directive for the Flemish public service, following the example of the Fédération Wallonie‑Bruxelles, which has already adopted similar measures.

At federal level, a proposal for a resolution on the implementation of the directive was introduced recently by one of the political fractions. The key messages are: implement the directive without gold‑plating, build on existing Belgian legislation, and avoid creating unnecessary administrative burden for employers.

However, Belgium’s legislative framework is not yet fully aligned with the new EU requirements, such as pay transparency both internal and external and a clear sanction framework in case of non-compliance. This leaves employers with a number of open questions about what will be expected of them and by when. And importantly, broad support for the “no gold‑plating” approach does not mean that no changes will be required.

In recent days, conflicting signals have emerged about the future of the EU pay transparency directive.

Some interpret the conclusions of the European Council of 19 March 2026 as a clear call to simplify EU regulations, seeing this as an opportunity to revisit the pay transparency directive as well.

Others argue that the Council did not touch the directive at all, no pause, no dilution. In their view, the directive remains fully in force.

Meanwhile, employers are left with uncertainty. Nobody is eager to take on additional reporting merely for the sake of reporting, yet the overall objective of the directive continues to receive broad support.

What is clear is that organizations investing today in transparent and structured reward practices will be the best prepared, regardless of how the political discussion evolves. The trend has started, and we have passed the point of no return.

Many organizations have moved beyond basic awareness and have started to prepare for the directive. Typical activities include conducting gender pay gap analyses, developing or refining job architecture, and reviewing internal processes. Nevertheless, only a limited number can be considered fully ready. Most are positioned somewhere between minimum compliance and more structured preparation, with only a minority of early adopters actively pursuing advanced transparency and proactive communication strategies.

A recurring observation is that many employers already hold the necessary HR and pay data, but lack the structure, analytical insight, and clear roadmap needed to move from raw information to operational readiness. This gap is likely to become more visible as key obligations start to bite.

While formal reporting obligations will only begin in June 2027 (based on 2026 data), the right to pay information, both prior to and during employment, will take effect as early as June 2026. This compressed timeline reinforces the need for timely preparation if organizations are to ensure compliance and maintain trust with employees and candidates.

KPMG supports employers holistically on their pay transparency journey, covering everything from data analytics and function classification to communication, training, and operational readiness.

Wherever you are on the maturity spectrum, we’re here to guide you.