Pay Transparency and People Strategy: beyond compliance, a new culture of pay

According to the most recent European data, in 2024 women in the European Union still earn, on average, hourly wages 11.1% lower than men. In Italy, the gap stands at 5.3%, one of the lowest figures in the EU, but this figure must be considered alongside another critical issue: the lower participation of women in the labour market and the limited presence of women in senior and higher-paid roles. It is precisely to make pay policies more transparent and reduce these inequalities that the European Union introduced the Pay Transparency Directive, transposed into Italian law through Legislative Decree 96/2026.

The Legislative Decree of 7 June places pay transparency at the heart of corporate policies: not only as a compliance requirement, but as a tool for equity, attractiveness and reputation.

For HR, this is not a technical requirement, but a change in approach: it affects job advertisements, interviews, pay bands and career paths. It means moving from implicit management to an explicit culture of consistency and equity.

Five Pillars, One Impact

The Decree is based on five pillars. Equal pay for equal work strengthens equal pay for work of equal value. Transparency in pay pathways requires clear criteria for salaries and career progression and prohibits asking candidates about their previous pay.

The right to information makes it possible to know pay bands and progression criteria. Pay reporting introduces the obligation to monitor the gender pay gap. Finally, in the event of unjustified gaps exceeding 5%, a joint assessment is triggered, with the burden of proof resting on the employer.

A Differentiated System, One Common Principle

Reporting obligations vary according to company size: annually for companies with more than 250 employees from 2027, every three years for those with between 150 and 249 employees, and for companies in the 100–149 employee range from 2031. Companies with fewer than 100 employees are not subject to periodic reporting, but remain covered by transparency obligations.

However, one cross-cutting principle remains: transparency in recruitment processes and the right to information. Job advertisements will have to indicate the pay range, it will not be possible to ask candidates about their previous pay, and recruitment processes will have to be based on non-discriminatory criteria. Employees will also be able to request information on their own pay level and on the criteria for progression.

Why Act Now

The new framework strengthens the central role of pay governance. Sanctions refer to the Equal Opportunities Code and, in the most serious cases, may extend as far as exclusion from public procurement.

A key element is the reversal of the burden of proof: it will be up to the company to demonstrate that any pay differences are based on objective and neutral criteria.

Delaying action exposes companies to a twofold risk: an operational risk, because without structured processes it becomes more complex to respond to requests and checks; and a reputational risk, because transparency is now central to how candidates and employees perceive an organisation.

From Obligation to Organisational Lever

Managing Pay Transparency requires integrated expertise: employment law, job architecture, pay analysis, data management and internal communication. The Red Public approach is built on these foundations: a three-stage process — Assessment, Design, Implement — across three dimensions: Transparency, Reporting and Information.

The Assessment builds a picture of the pay system through audits, job family mapping and gap analysis. Design translates the data into a structure: pay bands, reporting tools and information tools. Implement makes the model operational through training, digital tools and continuous monitoring.

The value lies not only in compliance, but in building stable pay governance capable of anticipating critical issues and strengthening internal and external trust.

Pay Transparency is no longer a future prospect, but a change already under way that is redefining the way organisations manage their pay policies. Those who start today build solid foundations and manage the change; those who delay risk being driven by it.

The true competitive lever is not declared transparency, but transparency put into practice. Kotter reminds us that change only has value when it becomes embedded in everyday behaviours.