Since 2010, Arago has been supporting European companies in transforming their HR and finance functions. As the 2026 deadline approaches, pay transparency is becoming a major priority for all organisations. The new European law introduces both obligations and opportunities: it is a chance to strengthen your compensation strategy, improve internal trust and enhance your employer brand.
This article summarises the key insights from our webinar with Xavier Le Mondement, compensation expert and specialist in pay transparency. It outlines the regulatory impacts and explains how to mobilise your stakeholders to successfully manage this cultural shift.
The European directive coming into effect in 2026 introduces a new framework around salary and transparency. Contrary to popular misconceptions, the law does not require organisations to publish all salaries or homogenise all compensation levels. Instead, it aims to improve fairness, reduce unjustified pay gaps and provide employees with clearer access to information.
Key obligations include:
Beyond compliance, this directive represents a real cultural transformation that impacts HR teams, managers, employee representatives, leadership and employees themselves.
Before taking action, organisations must understand their starting point. Arago uses a structured four-step approach:
This approach determines whether an organisation already has a solid foundation or needs to build its compensation transparency framework almost from scratch.
Success depends on more than technical compliance. Pay transparency requires a collective shift in mindset and involvement from all stakeholders:
One powerful method is to create internal personas to tailor communication and support. The concerns of a junior employee differ from those of a senior employee or a manager responsible for a large team.
With the law coming into force in mid-2026, organisations must build a sense of urgency. Otherwise, daily priorities may delay preparations and create risk. Arago helps structure a clear roadmap so each stakeholder understands what is expected and takes action early.
Communicating now is essential to avoid being overwhelmed when employee requests for salary information increase. Given the legal response times, delayed preparation could quickly become a bottleneck.
Pay transparency ultimately relies on the ability of people—not systems—to communicate clearly and confidently. Training is therefore critical.
HR departments must understand:
Managers need support to:
Recruitment teams must adapt to:
Implementing pay transparency often triggers concerns or resistance. These reactions are normal and closely linked to fear of losing control or the complexity of past decisions. Arago recommends several approaches:
Pay transparency is not a one-off project. It must become an ongoing practice integrated into recruitment, annual reviews, HR communication and compensation governance.
Rather than a constraint, the new transparency law can become a real driver of performance. It strengthens internal fairness, improves the employee experience and supports a more credible and attractive employer brand.
Organisations that begin preparing now will better manage risks, retain talent and differentiate themselves in the market.
Arago supports companies at every step of this transformation by aligning strategy, tools and change management to make pay transparency a long-term positive force.
Make an appointment with our experts to discuss your pay transparency policy, tailored to your specific context!
You can also check out the rest of our webserie on pay transparency.
Julien Craeynest is an HR consultant at Arago, specialising in HRIS and Comp & Ben issues. His technical and organisational expertise enables him to support companies in ensuring compliance and optimising their remuneration practices.
Xavier Meulemans is an independent consultant and former Director of Compensation & Benefits and HRIS at international groups. His in-depth knowledge of the strategic and operational challenges associated with salary transparency enables him to decipher its concrete impact on HR policies and social dialogue.
No, it applies to both the private and public sectors in the 27 countries of the European Union.
Yes, seniority is recognised as an objective criterion in the analysis of pay gaps.
Even in small organisations, it is possible to group together positions of equal value according to objective criteria such as level of qualification, expertise or responsibility, regardless of job titles.
No. The directive requires a company-specific analytical job evaluation system, in addition to the collective agreement.
Risks include individual or collective litigation, financial penalties, loss of employee confidence, and difficulties in recruiting or retaining talent.
Not necessarily. It requires transparency and justification for any discrepancies. Companies can choose between targeted or general increases based on their internal assessment.
Conducting an analysis of remuneration and pay gaps will be a necessary step. This is essential but not sufficient: the company will also have to comply with the other obligations inherent in the directive (duty to provide information, etc.).
Yes, seniority is an objective criterion.
This is where the value of a job weighting methodology lies: it allows us to look beyond job titles and focus on the impact of these positions on the organisation, using weighted objective criteria. It would be incorrect under the directive to consider two positions to be of equal value simply because they both have the title of director.
One possible solution is to address labour shortages in certain professions by using ad hoc pay scales (e.g. a specific scale for IT positions with a median salary 10% higher than the median salary on the general scale).
Very good point, unfortunately we will have to wait for transposition into national law and implementing decrees, as the directive is not specific on this point.