Preparing for the EU Pay Transparency Directive doesn't have to be overwhelming. This step-by-step checklist breaks down everything an SME needs to do to achieve compliance — from initial data audit to ongoing monitoring.
Phase 1: Assessment (Start Now)
Determine your reporting obligations
Based on your employee count, determine your reporting frequency and first reporting deadline.
Audit your current pay data
Identify all compensation components: base salary, bonuses, benefits in kind, variable pay, and allowances.
Map job roles and categories
Classify employees into categories of "same work" or "work of equal value" using objective criteria.
Identify existing pay gaps
Calculate the gender pay gap across each worker category. Flag any categories with a gap exceeding 5%.
Phase 2: Remediation (6–12 Months Before Deadline)
Develop an action plan for pay gaps above 5%
For each category exceeding the 5% threshold, document justifications or plan remedial adjustments.
Update recruitment processes
Include pay ranges in job postings. Remove pay history questions from interviews. Train hiring managers.
Establish pay information request procedures
Create a process for employees to request pay information. Ensure you can respond within the two-month deadline.
Train HR and management
Ensure HR teams and managers understand their obligations under the directive, including confidentiality requirements.
Phase 3: Reporting Infrastructure (3–6 Months Before)
Implement reporting tools
Set up software for automated pay gap calculations and report generation. Connect to your HRIS/payroll systems.
Generate and review test reports
Run initial reports to verify data accuracy and identify any data quality issues before the official reporting period.
Document your methodology
Record how you classify workers, calculate pay gaps, and determine "work of equal value" for audit purposes.
Phase 4: Ongoing Compliance
Submit reports on schedule
File your gender pay gap reports according to your reporting frequency (annually or every three years).
Monitor regulatory changes
Track how your member state's national law evolves. Requirements may tighten over time.
Review and improve continuously
Use each reporting cycle as an opportunity to identify and close remaining pay gaps. Document all remedial actions taken.
Automate your compliance checklist
GenderGov walks you through every step of this checklist with automated workflows, guided data imports, and real-time compliance tracking. Purpose-built for SMEs.
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