The entry into force of EU Directive 2023/970 does not merely amount to a regulatory adjustment on gender equality. It introduces a radical shift in the balance of power between employer and employee. The pillar on which the entire structure of the Directive rests is a disruptive legal principle: the reversal of the burden of proof.
In potential litigation concerning pay discrimination, the employee will no longer bear the burden of proving that they were subject to unequal or unjustified treatment. On the contrary, once the employee has provided indications of a disparity, it will be the company’s responsibility to prove, through objective data and pre-existing documentation, that its pay policies are based on neutral criteria and are free from any direct or indirect bias.
The Technical Concept of “Work of Equal Value”
The core technical challenge for HR professionals and legal advisers lies in the definition of “work of equal value.” The Directive requires a comparison not only between employees performing the same job, but also between different roles which, in terms of skills, responsibilities, effort and working conditions, bring equivalent value to the organization.
Without a scientific and analytical job evaluation system, the company is left exposed. If a Project Manager and an Operations Manager receive different levels of remuneration, the company must be able to justify that gap through a role-weighting process capable of withstanding legal scrutiny. If the assessment criteria are not set out in writing and communicated in advance, any difference exceeding 5% becomes indefensible.
The Three Main Lines of Technical Intervention
To mitigate risk and build robust compliance, action must move along three parallel tracks:
Statistical Audit and Data Granularity: Compliance begins with a neutral snapshot of the current situation. The company must map not only gross annual remuneration, but every single component of the compensation package: bonuses, performance incentives, benefits, expense reimbursements and variable elements. The analysis must identify clusters of comparable employees and calculate the average gap. Exceeding the 5% threshold without an objective justification, such as performance differences tracked through MBO systems or certified technical skills, requires the company to implement an immediate corrective plan and to carry out a joint assessment with employee representatives.
The New Right to Information: Every employee acquires the right to request information on the average pay levels of colleagues performing the same work or work of equal value. This means that the company must establish data governance capable of providing timely and accurate responses. An incomplete or delayed reply is not merely an administrative shortcoming. It becomes evidence in the employee’s favor in judicial proceedings.
The Review of Recruiting Processes: The Directive also affects the talent acquisition stage. Employers are prohibited from investigating a candidate’s pay history in order to formulate an offer. From a technical standpoint, this requires companies to define predetermined salary bands for each position. The offer must be based on the value of the role and on the candidate’s skills, not on their previous bargaining power. This requires an immediate update of talent acquisition processes in order to avoid importing pre-existing pay gaps into the company.
Conclusions: from Risk to Legal Certainty
Addressing Directive 2023/970 through a merely bureaucratic approach exposes the company to significant financial and reputational risks. True compliance arises from the ability to transform “emotional” pay practices, or practices based on individual negotiation, into systems that are certain, documented and defensible.
In this context, preventive documentation is not a burden. It is the only effective shield. Structuring evaluation processes and information flows today means protecting the company for the next decade, while at the same time ensuring fairer, more transparent and ultimately more efficient human resources management.
Would you like to know more?
The integrated team of Bacciardi Partners and Macrelli e Bartolini Associati supports companies throughout this transition by combining organizational design, employment consultancy and legal oversight, thereby turning a regulatory obligation into stronger and more sustainable governance. Contact us today to assess the compliance path together.
By Antonella Lanzani – Head of Organization & People – Bacciardi Partners