The EU Pay Transparency Directive, a legislation which aims to ensure equal pay for equal work and address the gender pay gap, will come into force this year. “This directive should not be seen as just a legal obligation but as a real opportunity for HR to be at the forefront of a meaningful cultural change in the workplace,” says JOANNE BONDIN, Director at misco.
The EU Pay Transparency Directive will come into force on the 24th of December 2025 and by the second half of 2027, the Directive mandates that employers with over 100 employees across the EU must also submit their first report on pay transparency.
According to Joanne Bondin, who leads misco’s HR operation, this Directive marks a pivotal moment across Europe for the sector.
“It reinforces the long-standing Maltese principle of equal pay for equal work, while also embedding the concept of equal pay for work of equal value, with particular emphasis on ‘value’ and aiming to narrow the gender pay gap.”
“I believe that all those who work in the field of HR should not regard this Directive as another compliance requirement, but as a real opportunity for meaningful change in how we reward, value, and engage our people,” adds Bondin.
One of the most notable changes is the requirement for greater openness in recruitment, where employers will be obliged to inform job candidates of the salary range for a vacancy, though the timing of this disclosure is left for employers to decide strategically.
Notably, asking about an applicant’s current or past remuneration will no longer be permitted.
“This shift has the potential to reset entrenched hiring dynamics by focusing discussions on the value of the role rather than the perceived worth of the individual based on previous earnings.”
Equally significant is the right for employees to request information on their own pay and how it compares with that of colleagues performing the same or similar work, broken down by gender.
“For some organisations, this may challenge long-standing taboos around salary discussions. However, for HR professionals, this underlines the role that transparency plays in building trust, clarity, and accountability,” adds Bondin.
The directive goes further still. Large organisations, initially those employing 250 or more people, and later those with as few as 100, will be required to submit reports on their gender pay gap – a decisive step toward embedding transparency and fairness into corporate structures, with HR playing a critical role in ensuring the process is both meaningful and constructive.
“What this directive demands is not a legal workaround but a cultural transformation,” notes Bondin.
“It challenges employers to re-examine the foundations of their pay and grading systems, asking whether they are truly gender-neutral and performance-driven, and places the responsibility for equitable structures firmly within the HR function, where it belongs.”
HR professionals should view this as an opportunity to strengthen their organisation’s offering and as a platform where transparency and openness form the basis of decisions, giving both employers and employees a clear framework for pay-related matters.
Bondin believes that HR teams should lead this transformation as a strategic initiative.
“Those in HR are the ones who truly understand the people and the culture of their organisations. Compliance could be a starting point, but ultimately, culture change is the destination.”
“The approach needs to be a proactive one. Every organisation should start with a thorough internal audit, not just to identify gender pay gaps, but to understand the mechanisms behind their pay decisions.”
“Often, disparities arise not from intentional bias but from outdated practices, inconsistent evaluation criteria, or natural organisational changes such as rapid growth or mergers. These disparities cannot be addressed only with data but through dialogue and reflection.”
“This is where HR adds real value. As HR practitioners, we are uniquely positioned to challenge assumptions, ask difficult questions, and design the frameworks needed to ensure fairness is embedded at every stage of the employee journey. From how we write job descriptions to how we determine how merit increases, HR strategy remains central to achieving pay equity.”
According to Bondin, pay transparency also strengthens employer branding, particularly with younger talent and while technology supports data tracking, it is HR’s human-centred approach that can ensure fairness, clarity, and trust in pay practices.
“There will inevitably be resistance. Change of this scale can cause discomfort, particularly in organisations unaccustomed to such openness. But the benefits far outweigh the challenges. A transparent pay culture reduces grievances, fosters a sense of value and respect among employees, and nurtures trust,” she added.
“I hope that many companies in Malta will not view transparency in remuneration as just a legal obligation but as a timely opportunity to close the gender pay gap.”
“This law will redefine what fairness in the workplace truly means.”
