Overview
- The government announced on Wednesday that it will not meet the EU deadline of 7 June 2026 to convert the 2023 pay‑transparency directive into German law and plans a phased, lower‑bureaucracy implementation beginning in early 2027.
- The EU directive requires workers to request gender‑disaggregated pay information, forces companies with 100 or more employees to report regularly if pay gaps exceed 5 percent, requires employers to publish starting salaries or salary ranges in job ads, and bans asking applicants about prior pay.
- Germany’s current 2018 Entgelttransparenzgesetz gives inquiry rights only in firms with more than 200 employees and has had limited effect on the measured gender pay gap, which stands at about 16 percent unadjusted and roughly 6 percent after adjustment for comparable work.
- SPD politicians and unions called the missed deadline a political failure and demanded legal certainty, while CDU figures and employer groups backed the ministry’s pause and urged measures to reduce administrative burdens, including presumptions that collective‑bargained pay is adequate.
- Delaying transposition could ease short‑term compliance pressure for firms but risks prolonging uncertainty for workers seeking pay information and shifts the debate toward pairing transparency rules with structural reforms such as addressing part‑time work and tax incentives that entrench pay differences.