Pay transparency across borders: A multijurisdictional Q&A

[co-author: Muhammad Vurney]

Pay transparency has moved rapidly up the global employment law agenda, reshaping how organizations approach hiring, compensation, and workforce equity. From the EU's landmark Pay Transparency Directive to evolving national frameworks in Germany, France, Italy, the Netherlands, the U.S., Mexico City, Spain and the UK, employers are navigating a patchwork of disclosure rules, reporting obligations, and enforcement mechanisms.

In this Q&A article, we unpack how these requirements vary across jurisdictions, exploring what they mean in practice and providing guidance to help employers align with fast-changing expectations around equity, compliance, and workplace culture.

France

Declining the constitutional general principle of equal treatment between all employees, French case law has established the principle ‘equal pay for equal work’, requiring employers to ensure equal remuneration to all employees in the same situation (especially performing the same work or a work of equal value).

A pay gap between employees performing equal work may nevertheless be lawful if the employer justifies it by objective and relevant grounds unrelated to any discrimination (seniority, experience, qualifications, etc.). Where it results from a company bargaining agreement or a company-wide collective agreement, the pay gap may also be presumed to be justified.

More specifically, the French Labor Code (articles L. 3221-2 to L. 3221-6), require all employers to ensure equal pay between women and men for the same work or work of equal value. Reporting obligations are associated with this requirement (see question 3 below).

Germany

Currently, Germany has the Pay Transparency Act [Entgelttransparenzgesetz – EntgTranspG] in place, which aims to ensure equal pay. The Pay Transparency Act applies primarily to employees and trainees, but also to civil servants (e.g., judges). Job applicants are currently not covered under the legal provisions.

The obligations under the Pay Transparency Act include the following:

• Employers, collective bargaining parties and company interest representatives are required to contribute to achieving pay equality.
• Employers are obliged to take the “necessary measures” to protect employees from gender-based pay discrimination; this includes preventive actions.
• Dependent on the number of employees, employers must provide specific information upon valid requests from employees.
• Employers must grant the works council access to lists detailing employees’ gross wages, broken down by gender. This includes any above-tariff allowances or individually negotiated payments.
• Depending on the number of employees, specific reporting obligations apply for employers.

By 7 June 2026, all EU member states are required to implement the provisions of the EU Pay Transparency Directive into national law. The requirements of the Directive are more stringent than those currently established under the German Pay Transparency Act. The Directive introduces expanded rights to information, reporting obligations, and compensation claims in cases of gender-based pay discrimination.

Italy

Under Italian Law there are only general principles regulating equal pay, specifically:

• Article 37 of the Italian Constitution states that female workers have right to the same salary due to male workers performing the same job;
• The Code of Equal Opportunities between men and women (Legislative Decree no. 198 of 2006) prohibits any direct or indirect discrimination regarding any aspect of the remuneration for same/equivalent jobs.

Accordingly, employers are legally required to ensure equal pay and prevent any related discrimination. However, in practice, Italian law does not establish specific obligations or mandatory measures to enforce this equality.

Mexico City

Yes, in Mexico, it is established that men and women must receive the same salary for the same work, regardless of their gender. The Mexican Constitution (Article 123, Section A, ClauseVII) establishes the principle that equal work should correspond to equal pay, without considering sex, gender, or nationality. It also specifies that laws will establish mechanisms aimed at reducing and eradicating the gender pay gap. Similarly, the Federal Labor Law (LFT) in its Article 86 reiterates this principle and adds that, in compliance with the State's obligation to reduce the gender pay gap, actions will be promoted to eliminate unequal pay practices in accordance with the provisions of the General Law for Equality between Women and Men.

Likewise, Article 2 of the LFT incorporates the principle of substantive equality, which, it states, is achieved by eliminating discrimination against women that undermines or nullifies the recognition, enjoyment, or exercise of their human rights and fundamental freedoms in the workplace. It entails access to the same opportunities, taking into account the biological, social, and cultural differences between women and men.

Additionally, ILO Convention 100, ratified by Mexico since 1951, reinforces this obligation. This means that employers must define salaries based on objective criteria, such as experience, responsibility, and job complexity, avoiding any gender bias.

As for employer obligations, it is clear that they must respect these principles and ensure equal pay between men and women. Otherwise, they may be subject to fines both in the labor sphere and for discrimination. This implies establishing objective and transparent criteria for determining salaries and conducting regular pay audits.

The Mexican Official Standard NMX-R-025-SCFI-2015 aims to ensure that employers integrate, implement, and execute practices for workplace equality and non-discrimination within their management and human resources processes, promoting the comprehensive development of workers. If an employer meets the requirements outlined in the standard, they may receive a certificate confirming that their practices are non-discriminatory. This standard is voluntary and not mandatory.

Spain

Yes, Spain has laws governing pay equality. The Spanish Constitution (Article 14) guarantees the right to equality and non-discrimination, which includes equal pay. Additionally, the Organic Law 3/2007 on the effective equality of women and men mandates employers to ensure equal pay for equal work or work of equal value between men and women.

Furthermore, the Royal Decree 901/2020, which establishes the requirement for companies with over 50 employees to develop and implement equality plans, mandates that these plans include specific actions to ensure equal pay. Companies are required to carry out annual salary audits and publish these audits as part of their equality plans.

In the coming years, Spain will also need to align with the European Union’s Pay Transparency Directive (2023/970), which must be transposed into national law by June 7, 2026. This Directive will impose stricter obligations regarding salary transparency and equal pay for equal work.

The Netherlands

In May 2023, the EU Pay Transparency Directive (the Directive) was adopted, introducing substantial measures aimed at addressing and reducing the gender pay gap across Europe. In response to this European legislation, a draft bill has been submitted in the Netherlands to implement the Directive (Wet implementatie richtlijn loontransparantie mannen en vrouwen). The implementation of this bill must be completed by no later than 7 June 2026.

The Dutch legislator has opted for a so-called “pure implementation” approach, meaning the bill adheres closely to the literal provisions of the Directive and includes only what is strictly necessary to meet the implementation requirements.

The draft bill will incorporate new rules in several existing Dutch laws, the Equal Treatment (Men and Women) Act, the Works Council Act and the Placement of Personnel by Intermediaries Act. These rules will impose significant obligations on employers, focusing on four key areas:

1. Employers must establish wage structures based on objective and gender-neutral criteria (skills, effort, responsibility and working conditions) to ensure fair and transparent pay practices;
2. Employers will be required to provide greater transparency in pay practices, including disclosing salary ranges and providing employees with information on pay levels and progression criteria;
3. Employers will face extensive reporting obligations, particularly larger employers; and
4. In wage-related disputes, the burden of proof will shift to the employer, meaning that the employer must demonstrate that the difference is based on objective criteria and not on gender or other discriminatory factors.

UK

Yes, under the Equality Act 2010 (the Equality Act). The provisions on equal pay within the Equality Act are very complicated and so are not set out in detail. At a high-level, however, the Equality Act gives men and women the right to receive equal treatment in relation to pay and other contractual terms and conditions of employment when they are employed on the same or broadly similar work, or on work which, although different, is of equal value. The Equality Act achieves this by implying a ‘sex equality clause’ into an employee’s contract of employment, which enables an employee to bring a Tribunal claim if they are treated less favorably than a comparable employee of the opposite sex in relation to a contractual term. An employer may be able to justify pay differences, if it can show that the difference in pay is due to a ‘material factor’, reliance on which does not involve direct or unjustified indirect discrimination.

Equal pay is a challenging area of UK law and one where there are likely to be changes in the coming years. Specifically:

• Under the Employment Rights Bill 2024, the UK government is proposing a wide range of comprehensive employment reforms. As part of this, employers with 250 or more employees will be required to:
  • Develop and publish equality action plans showing the steps they are taking in relation to prescribed matters relating to gender equality, which will include the measures they are taking to address their gender pay gap; and
  • Publish gender pay gap information about the service providers they contract with for outsourced services.

The government anticipates that these changes will come into force in 2027. Exact details and timings are not yet clear, however.

• Additionally, the forthcoming Equality (Race and Disability) Bill (which is currently still in consultation phase) is expected to be published later. Although details and timings are not yet confirmed, it is anticipated that this may implement the following measures relating to equal pay (amongst others):
  • Mandatory ethnicity and disability pay reporting for employers with 250 or more employees;
  • Establishment of a new Equal Pay Regulation and Enforcement Unit; and
  • Measures to address race and disability pay discrimination, which could include extending the equal pay regime to cover race and disability.

U.S.

Yes. U.S. federal law prohibits pay discrimination based on protected characteristics. For example, the Equal Pay Act requires men and women to be given equal pay for equal work. Title VII of the Civil Rights Act prohibits discrimination in compensation based on race, color, religion, sex, age, disability, and national origin. In addition, states and localities have their own laws that forbid discrimination in compensation. Some of these state laws impose additional protections around compensation discrimination, including forbidding employers from requesting wage or salary history from employees, or forbidding retaliation against employees for discussing their pay.

France

Not to date, French employers are not required to disclose information regarding pay treatment in job postings, offers or to employees upon request outside of any litigation, apart from the information published in the equality index and in the social report (bilan social) mentioned in question 3 below.

This obligation, however, is set forth by European Directive 2023/970 which France shall implement by 7 June 2026.

Specifically, pursuant to such Directive, employers will be required to:

1. Provide information regarding the initial remuneration (or salary range) for the position offered in job postings/during the hiring phase;
2. Upon employees’ or unions’ requests, provide information on individual pay scales and average pay scales, disaggregated by gender, categories of workers performing the same work or work of equal value.
3. Every year (or every three years, depending on the company's workforce), provide the relevant national authorities with information on pay gaps (applicable only to companies with more than 100 employees).

Germany

Under the Pay Transparency Act, there are no obligations towards job applicants as it does not apply to them.

The Employer is obliged to provide information upon a valid request from an individual employee if:

• There are regularly more than 200 employees under the same employer in the operation and;
• The employee first identifies an equivalent or comparable role.
• If these requirements are met, employees may request information on the median average monthly gross remuneration for that role and up to two individual pay components.
• However, the employer is only obliged to provide information if at least six employees of the opposite gender performing comparable roles are identified.

Obligations toward applicants (regardless of a specific number of employees):

• No prior request from the applicant is necessary; the employer must disclose the information on its own initiative.
• Information on initial pay or pay range and, if applicable, relevant collective agreement
• Point in time: “such as in a published job vacancy notice, prior to the job interview or otherwise".

General obligation towards employees (regardless of the number of employees):

• Information on criteria for determining:
  • Pay
  • Pay levels
  • Pay progression
• Information in an “easily accessible way”.
• Option for Member States to exclude companies with less than 50 employees.

Individual right of information:

• Employer’s obligation to provide certain information applies regardless of the number of employees.
• Modified content of the right to information: Individual pay level and Average pay levels of groups performing the same work or work of equal value, broken down by gender:
  • No more restrictions on the number of pay components.
  • Average remuneration instead of median remuneration must be disclosed.
  • No obligation for employees to name a comparable activity.
• Employer’s response in text form within three months.
• Annual information on the right to information.

Italy

No, currently in Italy employers are not mandated to disclose information regarding pay treatment. This obligation, however, is set forth by European Directive 2023/970 which Italy shall implement by 7 June 2026.

Specifically, pursuant to such Directive, employers will be required to:

• Provide information regarding the initial remuneration (or salary range) for the position offered in job postings/during the hiring phase;
• Upon employees’ or unions’ requests, provide information disaggregate for gender regarding average remuneration levels (for same jobs) and criteria used to define career and salary progression;
• Annually disclose to competent national authorities information on pay gaps (applicable only to companies employing more than 250 employees).

Mexico City

Mexican law does not require employers to disclose salary ranges. However, it is common practice for employers to inform candidates of the proposed salary at the beginning of the hiring process. In some cases, job offers include the salary amount.

Spain

Yes, under the Royal Decree-Law 6/2019, employers are required to disclose salary ranges in job postings and prior to interviews, as part of the effort to increase pay transparency. Additionally, employers must provide employees with information about salary scales and pay differences upon request.

Looking ahead, Spain will need to implement the European Union’s Pay Transparency Directive (2023/970), which will require employers to provide information on salary ranges or initial pay during the hiring phase and disclose this information to employees or unions upon request. The Directive will also require companies to report pay gaps to the relevant authorities starting in 2026.

The Netherlands

While there is currently no obligation to disclose salary ranges, the draft bill introduces a requirement to provide specific details on salary ranges. The scope and timing of these disclosures will vary.

During the hiring process:

• Job applicants must be informed of the initial salary or salary range prior to the interview.
• Contrary to the Directive, the Dutch draft legislation does not require this to be published in the job posting.

During employment:

• Employees must be informed of the criteria used to determine salary levels and progression.
• Notably, employers with fewer than 50 employees are exempt from the obligation to publish salary progression criteria.

Additionally, employees have the right to request written information about their own salary details, as well as the average salaries by gender for employees performing the same or similar work. Employers must respond to such requests within two months. Moreover, employers are required to inform all employees annually of their right to request this information.

UK

No. However, it appears there may be developments on this in the future.

For example, the UK government is considering various measures in relation to pay transparency, which would require employers to:

• Provide the specific salary or salary ranges of a job on the job advert or prior to interview;
• Not ask candidates their salary history;
• Publish or providing employees with information on pay, pay structures and criteria for progression;
• Provide employees with information on their pay level and how their pay compares to those doing the same role or work of equal value; and
• Identify actions that they need to take to avoid equal pay breaches occurring or continuing.

While exact details and timing of such requirements (if any) is not clear, this is an area to watch for future developments.

U.S.

There is no U.S. federal law requiring disclosure, but a number of U.S. states and Washington, D.C. have passed some form of a pay transparency law.

The laws vary by jurisdiction in their requirements, but generally, require the employer to provide salary or hourly pay ranges either in a job posting, when requested by an applicant or employee, or some form of both. These laws generally apply to external job postings but sometimes extend to internal promotion opportunities as well. Exactly what must be disclosed differs from jurisdiction to jurisdiction, and the disclosure requirements sometimes include not only information regarding pay but also benefits.

Some of these state and local laws are written such that they purport to require employers to adhere to their requirements when the employer posts a “remote” position that could be hired within the boundaries of the state or locality, even if the individual ultimately hired lives and works elsewhere.

France

Yes, but when reaching a specific threshold, pursuant to the French Labor Code (Articles L. 1142-7 et seq.), companies hiring at least 50 employees must publish in March of each year indicators relating to gender pay gaps and the measures taken to eliminate them. These indicators are compiled in an equality index and used to calculate a score out of 100.

If the score obtained by the company is less than 75 out of 100, the employer has three years to adjust it by negotiating corrective measures with the unions or by taking unilateral measures after consultation of the Works council. Employers may incur financial penalties if, at the end of the three-year period, the minimum score has still not been achieved.

If the 85-point score is not achieved, the employer must negotiate with the unions to set targets for improvement for each indicator, these negotiated targets being forwarded to the labor administration.

Employers of at least 300 employees must also establish a social report (bilan social) summarizing the key figures used to assess the company's social situation, record its achievements, and measure the changes that have taken place over the past year and the two previous years. This report must contain information regarding remuneration (average remuneration, remuneration scales, calculation method for remuneration, employee benefits, employer social security charges, amounts received by employees as profit sharing, etc.). This report is made available to the labor administration, employees who request it, and shareholders in certain companies. The information contained in this report is also entered into a database that can be consulted by the Works council.

Germany

Employers with more than 500 employees are required to report on gender equality and pay equity. The report must include:

• Measures taken to promote gender equality and their impact.
• Measures implemented to ensure equal pay for women and men.
• If no such measures have been taken, the employer must provide a justification in the report.
• The Pay Transparency Act does not provide for any immediate sanctions for violations of the reporting obligation.

In addition, private employers with more than 500 employees are “asked” to perform internal audits of their remuneration policies and the various remuneration components paid in order to verify compliance with the principle of equal pay.

The Wage Transparency Act does not provide for any sanctions if the internal audit is not conducted.

Under the new EU Pay Transparency Directive (EU/2023/970) requirements include periodic reporting obligation starting from 2027 depending on company size.

• 250 employees and more: annually (for the first time by 7 June 2027)
• 150–249 employees: every three years (for the first time by 7 June 2027)
• 100–149 employees: every three years (for the first time by 7 June 2031)
• Less than 100 employees: on a voluntary basis (Member States may introduce reporting obligations for employers with less than 100 employees)

Reports must contain the following information:

• The gender pay gap.
• The gender pay gap in complementary or variable components.
• The median gender pay gap.
• The median gender pay gap in complementary or variable components.
• The proportion of female and male workers receiving complementary or variable components.
• The proportion of female and male workers in each quartile pay band and;
• The gender pay gap between workers by categories of workers broken down by ordinary basic wage or salary and complementary or variable components.
• Confirmation of the report by the employer’s management after consulting workers’ representative.

In addition, the directive provides for an obligation to carry out joint pay assessments in cooperation with the employee representatives, if:

• The pay reporting demonstrates a difference in the average pay level between female and male workers of at least 5 % in any category of workers.
• The employer cannot justify such a difference in the average pay level on the basis of objective criteria and;
• The employer has not corrected the unjustified difference within six months.

Italy

Yes, pursuant to the Code of Equal Opportunities between men and women (Legislative Decree no. 198 of 2006) employers with more than 50 employees are required to submit a report every two years (to the Ministry of Labor and works councils) regarding the situation of male and female employees. Specifically, the report shall contain information regarding each job position and in relation to, among others: recruitment, training, promotions, levels, furlough programs, dismissals, retirements, remunerations, etc.

Companies employing less than 50 employees can submit the report on a voluntary basis to obtain the relevant benefits (e.g. rewards mechanisms in public tenders).

Mexico City

It is not mandatory for all companies, but it is highly recommended.

However, if a workplace wishes to obtain a compliance certificate in Workplace Equality and Non-Discrimination as referenced in the Mexican Official Standard NMX-R-025-SCFI-2015, an audit must be conducted to confirm the level of compliance. Once the certificate is obtained, an audit must be conducted every two years to maintain its validity.

Additionally, Article 994, Section VI of the Federal Labor Law (LFT) imposes fines on employers who engage in discriminatory acts. Therefore, conducting audits is advisable to avoid engaging in discriminatory practices.

Furthermore, ILO Conventions 111 and 100 promote gender pay equity and non-discrimination, obligating countries to implement measures to guarantee and enforce these rights. Conducting audits and reports helps identify unjustified pay disparities and strengthens workers' trust.

Spain

Yes, in Spain, employers with more than 50 employees are required to conduct pay audits as part of their gender equality plans. Under Royal Decree 901/2020, companies must assess and publish a report on gender pay gaps as part of their annual equality plan. This report should include a comprehensive analysis of the salary differences between men and women, including base pay and any additional compensations.

Spain will also need to comply with the European Union’s Pay Transparency Directive by 2026, which will impose additional requirements on companies to conduct regular pay audits and disclose pay gaps. This includes disclosing information on the gender pay gap, both in basic salaries and in additional or variable pay, broken down by categories of employees performing equal work or work of equal value.

The Netherlands

Yes, under the Dutch draft bill certain employers will be required to conduct pay equity analysis and report the potential gender pay gap within the organization. However, the extent of these obligations will depend on the size of the employer.

Employers with 100 or more employees will be subject to mandatory reporting obligations. These employers must report to a central monitoring body, which is yet to be established. The report must include data on the average wage differences between men and women within the organization, covering both the basic wage and any additional or variable remuneration. The data will be published on a national public website. However, the exact format and specific details of the public disclosure will need to be established through subordinate legislation.

Additionally, the report must be confirmed by management in consultation with the works council and shared internally with the employees.

The frequency of reporting depends on the size of the employer:

• Employers with 100 to 249 employees must report every three years;
• Employers with 250 or more employees must report annually.

UK

Employers with 250 or more employees must report annually on their overall gender pay and bonus gender pay gap, the proportion of men and women across pay quartiles, and the proportion of men and women who receive a bonus. The information must be reported to the government and published on the employer’s website.

Employers with fewer than 250 employees may voluntarily report their gender pay gap data, but they are not legally required to do so. The government also encourages employers to provide similar information about their ethnicity pay gap, but this is not yet mandatory.

There are various developments anticipated in this area, however, which mean that more comprehensive mandatory pay gap reporting is likely to be introduced in the near future in the UK – please see our question [1] above for more detail.

U.S.

There is no general requirement to conduct a pay equity audit or analysis. Typically, a pay equity audit is done under privilege as directed by counsel as a proactive measure, or potentially in response to employee complaints of unfair or unequal pay.

Some states, including California and Illinois, require covered employers to periodically report data regarding their pay and associated demographic data.

France

No, French law does not include specific anti-retaliation or confidentiality rules focused exclusively on pay transparency.

However, employees can report any unlawful conduct through the whistleblowing channel and/or to their HR/supervisors, which guarantees employees the possibility of complaining about any violation constituting a crime or offense, such as discrimination, including those related to remuneration. Any kind of retaliation (such as dismissal, demotion, or other negative consequences) is prohibited.

If the employee is covered by the whistleblower status, any retaliation measures may entail the nullity of the sanction and/or the dismissal.

Germany

Under the Wage Transparency Act, protection of personal data of both the requesting employees and the employees affected by the request must be ensured when responding to any such request for information.

The requested information regarding the median remuneration and individual pay components does not need to be disclosed if fewer than six employees of the opposite gender perform the comparable role.

When disclosing information, it has to be ensured that only those persons responsible for the request is granted access to the necessary data.

Requirements under the new EU Pay Transparency Directive include prohibition of confidentiality clauses.

Italy

No, Italian law does not include specific anti-retaliation or confidentiality rules focused exclusively on pay transparency.

However, employees can report any unlawful conduct through the whistleblowing system, which guarantees employees the possibility of complaining about any type of violation, including those related to remuneration. In case of claims under the whistleblowing system any kind of retaliation (such as dismissal, demotion, or other negative consequences) is prohibited, and, in addition, the identity of the whistleblower is protected and cannot be disclosed without his/her consent.

The adoption of a whistleblowing system is, however, mandatory only for companies which employ over 50 employees or, regardless of the number of employees, implemented the so called 231 Model and/or operate in certain sectors (e.g. financial services, transport security, environment security).

Mexico City

Since the Federal Labor Law (LFT) itself does not impose an obligation on employers to make salary range information transparent or disclose it, it is possible that, by doing so, the employer could face sanctions for violating workers' information. Therefore, before revealing such information, the act must be analyzed to avoid violating personal data protection regulations.

Furthermore, the Federal Law to Prevent and Eliminate Discrimination, in its Article 9, Section XVIII, considers restricting access to information as a discriminatory act. This could include the possibility of a female worker requesting information about another worker's salary to confirm whether she is receiving the same pay for equal work. Therefore, under the protection of this article, it is possible to request information to confirm whether the assigned salary is fair and equitable.

In another aspect, in line with the spirit of the Mexican Constitution, the LFT, the Federal Law to Prevent and Eliminate Discrimination, and international instruments ratified by Mexico, employers are prohibited from retaliating against those who report gender pay inequality or participate in legal processes. Although some companies may include salary confidentiality clauses, these cannot prevent employees from exercising their rights to report inequalities or participate in collective bargaining. Such clauses may be declared null by authorities for restricting and violating rights and could even be considered as undermining actions to prevent discrimination and reduce gender pay gaps.

Spain

Yes, Spain has anti-retaliation protection for employees who report unequal pay or discrimination. Organic Law 3/2007 and Royal Decree 901/2020 protect employees from retaliation for engaging in actions to ensure equality or for reporting pay discrimination. Employers are prohibited from dismissing or otherwise retaliating against employees for raising concerns about pay inequality.

Additionally, data protection laws, particularly the Organic Law 3/2018 on Personal Data Protection and the General Data Protection Regulation (GDPR), govern how personal data, including salary information, must be handled in Spain. Employers must ensure that data related to salaries and employee compensation is managed in a way that complies with data privacy laws.

The Netherlands

No, Dutch law does not include specific anti-retaliation or confidentiality rules focused exclusively on pay transparency. However, based on the responses to the draft bill following from the internet consultation, this remains a key area of focus as the implementation of the Directive in the Netherlands is still pending.

In the meantime, employers must comply with the general anti-retaliation and confidentiality rules under Dutch law, including those outlined in the Dutch Equal Treatment (Men and Women) Act, the Dutch Whistleblower Protection Act and the GDPR. Additionally, employers are required to observe the principle of good employment practices (goed werkgeverschap), which obliges them to act reasonably and fairly towards their employees.

UK

In relation to gender pay gap reporting, there are no specific anti-retaliation or confidentiality rules that affect how employers can manage transparency.

As outlined under question [3] above, affected employers in the private and voluntary sector are required to publish their gender pay gap report (along with a written statement of accuracy) within 12 months and thereafter they must produce and publish an annual report on their website which must be kept available for three years (and the information must also be uploaded to a government website). This obligation can be inferred as employers being protected from retaliation for disclosing pay information, though, as mentioned above, there are no explicit anti-retaliation measures.

Employers should, however, be mindful of data protection law when gathering data for gender pay gap reporting as this activity will likely include the processing of personal data for which there must be a lawful basis for processing (the relevant lawful basis in this context would be complying with a legal obligation).

U.S.

The Equal Pay Act, Title VII, and equivalent state and local laws have anti-retaliation provisions making it unlawful for an employer to retaliate against an employee or applicant who opposes discriminatory compensation practices.

Many state and local pay transparency laws have anti-retaliation provisions making it unlawful for employers to prohibit or retaliate against employees for other reasons, such as when employees seek to discuss their wages with other employees.

France

Currently under French law there are no obligations regarding pay transparency (see question 2). Accordingly, there are no penalties for employers in this respect. In any case, in case of discriminations or unequal treatment regarding the remuneration (see question 1) employees may seek damages compensation and the Labor Courts may order employers to cease the discriminatory conduct.

It is worth noting though that the gender equality index is made public and therefore anyone may verify the score. Companies tend to communicate on this to promote their inclusion/diversity/equity programs, if any.

Germany

Employees who experience discrimination are entitled to compensation and, if applicable, damages in accordance with the German General Equal Treatment Act [Allgemeines Gleichbehandlungsgesetz – AGG].

No further sanctions are imposed; however, in the case of reporting obligations for certain companies, violations or non-compliance may negatively impact the company's reputation if those become public.

Entitlement to compensation in case of noncompliance:

• Entitlement to compensation which should cover full repayment of all lost wages, bonuses, and benefits in kind.
• Compensation should also include lost opportunities and non-material (intangible) damages.
• Prohibition of an upper limit for the amount of compensation.

Sanctions for employers in case of noncompliance:

• Obligation of EU member States to establish effective, proportionate, and dissuasive sanctions for violations of the regulations.
• Any sanctions, which may include fines, should ensure a genuinely deterrent effect against breaches of rights and obligations related to the principle of equal pay.
• Specific wording and implementation of these sanctions are at discretion of the EU Member States.

Italy

Currently under Italian law there are no obligations regarding pay transparency (see question 2). Accordingly, there are no penalties for employers in this respect. In any case, in case of discriminations regarding the remuneration treatment (see question 1) employees may seek damages compensation and the labor courts may order employers to cease the discriminatory conduct. Besides legal consequences, employers also face potential reputational risks from such violations.

Mexico City

Although not explicitly mentioned in the LFT, some legislators have proposed fines of up to $540,000 pesos for companies that engage in gender pay gaps, though this has not been approved. However, failing to comply with gender pay equality can be considered a discriminatory act, leading to economic sanctions ranging from 250 to 5,000 UMA (Article 994, Section VI of the LFT); individual or collective lawsuits filed with labor authorities by female workers demanding salary adjustments; reputational damage that undermines employee trust; and international liability if ratified treaties are violated, should the Mexican State allow such conduct and fail to impose necessary disciplinary measures. Additionally, labor courts may order retroactive payment of salary differences and compensation to female workers who file claims.

In the criminal sphere, Article 149 Ter, Section II of the Penal Code establishes penalties of one to three years in prison or 150 to 300 days of community service, and up to 200 days of fines for individuals who deny or restrict labor rights, particularly on the grounds of gender or pregnancy. This provision can also be interpreted and applied in cases of violations of the right to equal pay, provided it is deemed an act of discrimination.

Moreover, employers who have received the compliance certificate mentioned in point 3 but fail to meet any measure or do not conduct the required audit every two years as per the Official Standard—or if the audit results are unfavorable—will have their certificate revoked and will no longer be able to claim compliance.

Spain

In Spain, noncompliance with pay transparency and gender equality obligations can result in administrative fines imposed by the Labor Inspectorate. Employers may also face reputational risks, as failure to comply with gender equality or pay transparency regulations can lead to negative publicity, particularly if the issue is publicly disclosed or discovered through inspections.

Furthermore, employees can file complaints with labor courts in cases of pay discrimination, which can lead to compensatory damages and possible corrective actions for employers.

As Spain will be required to transpose the European Union’s Pay Transparency Directive by 2026, additional penalties and enforcement mechanisms may be introduced in the future, particularly for employers who fail to comply with salary transparency and audit obligations.

The Netherlands

Non-compliance with the Dutch draft bill on pay transparency can lead to both legal and administrative consequences, as well as reputational risks for employers. The enforcement mechanisms include individual claims, administrative oversight, and public disclosure or violations.

Individual wage claims

Employees, or their representatives (such as a trade unions), can file individual wage claims to recover lost wages, bonuses, or other benefits resulting from pay discrimination. In such cases, a legal presumption of wage discrimination arises, which means the employer must demonstrate that no discrimination occurred and that the pay differences are based on objective, lawful and non-discriminatory criteria.

Only if the employer can demonstrate that the violation was minor and unintentional, the burden of proof remains with the employee.

Administrative enforcement

The Dutch Labor Inspectorate (Arbeidsinspectie) is responsible for supervising compliance with pay transparency obligations. Employers who fail to meet these obligations may face administrative fines of up to EUR 10,300 per violation (2024 level). Moreover, the Dutch Labor Inspectorate is required to publish information about official warning or fines issued to employers. This public disclosure can expose non-compliant employers to significant reputational risks, potentially affecting their standing with employees, customers and business partners.

UK

In the context of gender pay gap reporting, there is no specific civil enforcement mechanism.

The UK Government runs periodic checks for non-compliance and it can “name and shame” employers on the Equality and Human Rights Commission’s (the EHRC) website, which would create reputational issues for employers. The EHRC can carry out investigations where there is an “unlawful act”, but there is doubt as to whether this extends to a failure to comply with gender pay gap reporting. However, previously the EHRC has sent warning notices to employers who failed to comply. If a warning notice does not result in an employer complying with gender pay gap reporting, the EHRC can carry out a formal investigation and issue an unlawful act notice which requires employers to prepare a draft action plan to remedy the issue – a failure to comply with the action plan could result in the EHRC pursuing a court order to seek compliance. The EHRC publishes on its websites the details of the employers it investigates.

To prevent the risk of non-compliance with gender pay gap reporting, an employer can carry out an equal pay audit. This is good practice and gives an employer comfort that it is complying with its legal obligations. The EHRC’s website provides guidance on carrying out equal pay audits.

It is possible for an employee to pursue an employment tribunal claim for equal pay where they are paid less than a colleague of the opposite gender who is carrying out “equal work”. If a claim is successful, the employment contract is treated as if it had always contained the same pay / equal pay, and compensation can be claimed for a period dating back 6 years from when the claim was issued. If an employer is found by an employment tribunal to be in breach of equal pay law, in certain circumstances the employment tribunal may be required to order the employer to carry out an equal pay audit (which, amongst other things, involves the publication of gender pay gap information). A failure to comply with such order could result in the tribunal imposing a financial penalty of up to £5,000 (which penalty can be repeated until the order is complied with).

As mentioned above, the UK Government is considering introducing pay transparency measures, which are similar to the EU Pay Transparency Directive which contains enforcement mechanisms (including penalties for non-compliance). It is expected that any such future measures will include specific penalties for employers who fail to comply. The UK Government is considering establishing an Equal Pay Regulatory and Enforcement Unit (with the involvement of trade unions) to improve the enforcement of equal pay rights.

U.S.

In addition to administrative charges and lawsuits, state and local laws provide for fines, penalties, damages, or even attorneys’ fees against employers that violate their pay transparency laws. Colorado publishes a list of those employers that have received citations for violating pay transparency laws, so noncompliance with at least one state’s law carries with it reputational risk.