Preparing to comply with the EU Pay Transparency Directive

Whilst the June 2026 deadline for meeting the requirements of the EU Pay Transparency Directive is well-established, the drive towards greater pay equity across organisations has been an objective for far longer. 

The organisations we work for today have grown in complexity with highly varied workforces – some of this is due to the growth evolution of those organisations, and in part, also due to the fast-changing nature of the markets they operate in. 

And with data now becoming more readily available on all aspects of our job roles, it has enabled the ability to analyse, compare and report on a wide array of information. 

Pay equity across gender, ethnicity, disability and other characteristics is becoming a wider legal requirement – “equal pay for equal work” is a long-standing principle dating back to 1890s America but has taken a significant amount of time to be enforced. 

However, in order to achieve pay equity and transparency, there is likely to be a significant amount of work. This includes: 

• A comprehensive analysis of your current job, grade and pay structures 
• Identification of unjustified gaps and required resolutions 
• Development of reporting to meet regulatory, organisational and employee transparency requirements 
• Development of longer-term people management strategies & policies including hiring, promotion, pay & compensation, employee & stakeholder communications   

Whilst the undertaking may be extensive for some organisations, the long-term benefits are expected to be extensive:

• Transparency and openness – First and foremost, employees should anticipate a growing trustful relationship with their employer 
• Greater confidence and credibility – From the beginning of the hiring process and throughout employment, colleagues can feel greater alignment with their employer 
• Fairness within the workplace – There may have been pay disparities that employers have previously been aware of. Through the analysis and preparation for pay transparency reporting, strategies and structures should have addressed any anomalies 
• Openly demonstrate reputational integrity – Through open and transparent policies, structures and processes, employers can demonstrate how they operate as an organisation, which is likely to encourage the retainment of talent 

But how can users of SAP’s Business Suite easily report pay transparency to both their employees and regulatory bodies? 

Well, the good news is that launching in 1H 2026, EU Pay Transparency Insights is a new capability within the People Intelligence package in SAP Business Data Cloud (SAP BDC), an intelligent, AI-powered application that can deliver ready-to-use, actionable insights to help leaders make more informed decisions. EU Pay Transparency Insights enables organisations to analyse compensation, identify outliers, and address pay gaps, helping them meet reporting requirements while unlocking the workforce and business performance benefits of achieving true pay equity. 

How does this new capability assist with meeting the reporting requirements of the EU Pay Transparency Directive? 

1. Gender Pay Gap Reporting 

With EU Pay Transparency Insights within People Intelligence in SAP BDC, organisations will be able to access rich workforce insights to analyse compensation and identify drivers behind pay gaps, giving them the information they need to generate actionable reports with a complete view of workforce equity in a single place. 

2. Employee Pay Transparency 

By leveraging the powerful document generation capabilities in SAP SuccessFactors HCM, employers can provide employees with a self-service experience to display individual pay transparency statements directly from the People Profile in SAP SuccessFactors Employee Central. These statements can give clear insight into the employee’s annual pay and the average pay of the same worker category broken down by gender. 

3. Candidate Pay Transparency 

SAP SuccessFactors solutions help enhance pay transparency by enabling employers to display pay ranges directly within job postings published through SAP’s recruiting solutions, including SAP SuccessFactors Recruiting and SmartRecruiters. 

So, where to go from here?… 

As with everything in life, early preparation will stand you in good stead. The minimum transparency and reporting requirements for employers with a workforce of 100 or more commence from June 7 2026.  

We offer walk-throughs and demos of document generation reporting capabilities within SAP SuccessFactors, please contact us to schedule a demo with one our SAP experts. 

With the release of the new EU Pay Transparency Insights within People Intelligence in SAP BDC, SAP are running a 1 hour webinar on Wednesday February 25th on “Ready on Day One: Confidently Navigate the EU Pay Transparency Directive” – find out more and register here.