From June 2026, pay transparency regulations for companies in Germany will be significantly tightened. The reason is the EU Pay Transparency Directive, whose implementation deadline will then expire.
For companies, this means:
- More pay transparency
- More statutory obligations
- More pressure to act in HR
At the same time, expectations from applicants and employees are rising.
What is the Pay Transparency Act?
The Pay Transparency Act (EntgTranspG) is designed to ensure: Equal pay for equal or equivalent work.
To achieve this, it relies on three core elements:
Transparent pay structures
Rights of employees to information
Reporting obligations for companies
With the EU Directive, the Act will be significantly tightened and made more binding from 2026.
Pay Transparency Act 2026: Who does it apply to?
The new regulations primarily affect:
- Companies with 100 or more employees
- Companies with 250 or more employees (with extended reporting obligations)
- Employers in Germany in an EU context
Important for SMEs: Smaller companies are also indirectly affected – through rising expectations in the labour market.
The most important changes in the Pay Transparency Act
Pay transparency in the recruitment process
Salary or salary range becomes a mandatory part of job advertisements – alternatively, disclosure must take place before the first interview. Applicants can make more informed decisions and negotiate more effectively.
Extended right to information for employees
Access to average salaries of comparable colleagues as well as transparency on remuneration criteria – with no minimum size for comparison groups.
Ban on pay secrecy
Employees are allowed to openly discuss their salary – pay differences become visible, both internally and externally.
Mandatory pay analyses and reports
Systematic analysis of pay differences and regular reporting become mandatory – particularly relevant for large companies and organisations following mergers or reorganisations.
Higher risks for unequal treatment
Companies must actively address inequalities. The burden of proof shifts partly in favour of employees – legal risks increase significantly.
Impact of the Pay Transparency Act on HR and companies
The new requirements affect not only HR processes, but the entire organisation:
HR & Processes
Recruiting
Salary becomes a fixed part of communications
Remuneration
Clear, comprehensible criteria are mandatory
Controlling
Salary data must be analysable
Compliance
Documentation becomes critical
Leadership & corporate culture
- Transparency must be actively embraced
- Managers must be able to communicate pay logic
- Dialogue becomes a key factor
Important: A lack of communication can quickly lead to dissatisfaction or loss of trust.
Benefits for employees
The new Pay Transparency Act significantly strengthens workers:
- Greater insight into pay structures
- Better negotiating position
- More protection against discrimination
Result: More fairness and clarity within the company.
Conclusion: Pay transparency becomes an obligation
Pay transparency is no longer a nice-to-have, but a legal obligation. Companies that act early:
- minimise legal risks
- strengthen their employer brand
- improve employee retention and trust
Implementing pay transparency: Why HR software is crucial
The new requirements are complex and data-driven. Modern HR software supports companies in:
Clear remuneration structures
Present pay structures transparently
Identify inequalities early
Implement reporting efficiently
Without structured systems, pay transparency will be virtually impossible to implement.
Webinar: Implementing the Pay Transparency Act in practice
How can you implement the requirements in your day-to-day HR operations? In our webinar, we will show you how to map the Pay Transparency Act in HELIX:
Start11:00
Duration60 minutes
Pay Transparency Act in HELIX – How to implement it procedurally!
What to expect:
- Understanding the Pay Transparency Act What does the law require and what obligations do you have as an employer?
- Implementation in HELIX How to map the procedural requirements in the system using various modules.
- Using automation How to automate processes and save yourself recurring effort.
