Employers take note! pay transparency becomes mandatory

In recent years, women’s participation in the labour market has increased, and women are thankfully becoming more economically independent. Nevertheless, there is still no true equality between men and women in the labour market. Although the right to equal pay for work of equal value has been enshrined in law for decades, there remains in the Netherlands both an overall gender pay gap and a (smaller but persistent) pay gap for equivalent work (source: CBS).

One of the main reasons for the continuing gender pay gap is the lack of transparency within organisations. Many employers still fail to provide insight into pay differences between men and women. This makes it difficult, and in some cases even impossible, for female employees to determine whether they are paid the same as their male colleagues for equal or equivalent work.

The new transparency obligations carry significant administrative and financial consequences for employers. In cases of non-compliance, the Labour Authority can impose fines, and employees may claim compensation for unpaid remuneration. In this two-part series, Projective Group and QBiDD Advisory combine their expertise to give you an overview of the new legislation and its impact on your organisation. We will cover:

• what the obligations are;
• which parts of your organisation will be affected;
• what is required to become compliant; and
• how we can support you.

Today, Part 1: the new legislation, what this means for your organisation, and the role we can play.

New legislation as of 7 June 2026

From 7 June 2026, significant changes will come into effect for employers in the Netherlands. New legislation, based on a European directive ((EU) 2023/970), will require greater pay transparency in order to ensure equal pay between men and women. The law requires employers to make salary structures clearer and more objective. Employers – and in particular HR and Finance departments – appear to be insufficiently aware of both the urgency and the impact of this new legislation.

Does this apply to me?

The Pay Transparency Act applies to all employers, regardless of sector or company size. Temporary agency workers are also included within its scope. It makes no difference whether your employees work full-time or part-time, on permanent or temporary contracts, or what their job title is – the rules apply to everyone.

For organisations with 100 or more employees, additional reporting obligations will apply. These obligations will be introduced in phases. Other requirements (see below), such as transparency about pay criteria and the right of employees to request salary information, will apply from the date the law takes effect.

What are the obligations?

All employers will be required to be transparent about how salaries are determined. This necessitates a pay structure that assesses employees not by job titles or labels, but by the actual value of their work. Such a structure must be based on objective and gender-neutral criteria – such as skills, effort, responsibilities, and working conditions – ensuring that equivalent work is equally remunerated. Additional factors, such as education and experience, may only be taken into account if demonstrably relevant to the position concerned.

This process starts at recruitment: prior to employment, the starting salary or salary scale must be disclosed, and employers will no longer be permitted to ask applicants about their previous salary. Job titles must also be gender-neutral, and the recruitment process must be entirely free from discrimination. Salary negotiations remain possible, meaning that differences in pay for the same or equivalent roles may occur. However, any difference must be objectively justifiable, for example through differing levels of experience or proven performance.

Once employed, workers will have the right to receive written information about their own salary and the average salary of colleagues in comparable roles, broken down by gender. If the information is inaccurate or incomplete, the employer must provide clarification within no more than two months of the request.

Employers are also required to inform staff annually of this right and explain how it can be exercised. Employers with 50 or more employees must additionally disclose which objective and gender-neutral criteria are applied in pay setting and pay progression.

For larger organisations (with 100 or more employees), there is also a reporting obligation. These employers must periodically report on the gender pay gap within their organisation, publishing the information on a public website.

The report must also be shared with employees, broken down by employee categories. On request, the employer must clarify the report within a reasonable timeframe and explain any pay gaps. If the employer cannot justify gaps on the basis of objective and gender-neutral criteria, they must correct them within a reasonable period. This applies to any unjustified pay difference – no matter how small – and must be communicated transparently within the organisation.

If employers cannot explain pay differences of 5% or more with objective and gender-neutral criteria, and are also unable to remedy them within six months, they are obliged to carry out a pay evaluation with the works council or trade union. This evaluation must result in an action plan outlining causes and solutions for the pay gap, which must be shared with employees and the monitoring body.

The works council will play an explicit role in the reporting obligation: it must have prior insight into the evaluation methodology used and be consulted on the content of the report before submission to the monitoring authority. The works council’s right of consent is also expanded: employers will need its approval for decisions concerning the objective, gender-neutral criteria forming the basis of the organisation’s pay structure. Be aware that this process may be time-consuming, so employers should not wait too long to start.

It is important to note that these rules apply not only to base salary, but also separately to all supplementary and variable pay components. Employers may not use bonuses, allowances, or other benefits to distort the picture or to circumvent the effect of the pay transparency legislation.

What can we do for you?

The Pay Transparency Act is far more than a new compliance requirement. It represents a major milestone, aimed at actively reducing the gender pay gap, increasing pay transparency in the workplace, and strengthening fairness and trust within organisations.

By investing in pay transparency now, organisations not only reduce the risk of fines and compensation claims, but also build a future-proof working environment where equality and integrity are central. At the same time, the new rules bring substantial administrative and financial challenges. With stricter enforcement and the burden of proof shifting to employers, timely and accurate compliance is essential to avoid penalties and claims.

With limited time until the implementation deadline, this is the moment for companies to implement robust, automated processes that simplify compliance and promote transparency. Organisations that prepare in time will avoid last-minute pressure and operational risks, while also achieving internal efficiency gains and strengthening their external reputation as transparent and fair employers. Proactive preparation is therefore crucial. By acting now, you can position yourself as a leader in pay transparency and demonstrate that fair and transparent remuneration is a genuine priority.

Complying with the new legislation requires a careful, structured approach: from systematic analysis and strategic communication to the use of specialised tools. Most organisations do not have dedicated pay specialists who can simply take on such a project. Because pay structures must be based on objective and gender-neutral job evaluation, it is logical for external remuneration consultants to assist organisations in implementing the law.

There is also specialised software available to support both advisers and organisations in collecting and analysing pay data in a controlled environment. Some solutions go further, enabling pay data to be reported in accordance with the directive after analysis and any corrections. In addition, these systems can be configured to provide employees and managers with easy access to the information to which they are entitled under the directive.

By investing in pay transparency solutions and by engaging external expertise, HR and Finance teams can streamline compliance efforts through structured job evaluations, automated reporting, cost analysis, and transparent dashboards for both employees and managers. We are ready to help you develop and implement a future-proof approach. Whether it concerns strategic advice, job evaluation, software selection, or establishing transparent reporting structures – we are here to support you!

We closely monitor developmentsand will, of course, keep you informed as soon as new information becomes available. In the meantime, would you like to discuss the latest status or understand what this specifically means for your organisation? Please do not hesitate to contact us. We also keep you updated via our website and monthly newsletter. To stay informed, sign up for our newsletter: