Italy Implements the EU Pay Transparency Directive

Salary Transparency in Recruitment

One of the most visible changes concerns hiring practices. Employers must provide the starting salary or pay range in job advertisements, together with the relevant provisions of the applicable collective bargaining agreement.

Employers are also prohibited from asking candidates about their current or previous pay. This applies both directly and indirectly, including through recruiters or other third parties.

For employers, this means recruitment templates, job ads and hiring processes should be reviewed to ensure they meet the new transparency requirements.

Clear Pay Criteria and Pay Progression

The new law requires employers to make the criteria used to determine pay and pay levels accessible to employees. These criteria must be objective and gender neutral.

Employers with 50 or more employees must also make pay progression criteria available. This includes how employees can move between pay levels and how pay develops over time.

In Italy, collective bargaining agreements play an important role in defining pay and role classifications. Employers should therefore review how their internal job architecture, pay structures and classification systems align with the applicable collective bargaining framework.

Stronger Employee Rights to Pay Information

Employees now have the right to request information about average pay levels for workers performing the same work or work of equal value, broken down by gender.

Employers must provide this information within two months of the request. The right can generally be exercised once per year, and employees must be reminded annually that they have this right.

For organisations, this creates a need for reliable pay data, clear employee categories and the ability to explain pay differences using objective and gender neutral criteria.

Gender Pay Gap Reporting Requirements

The new law introduces gender pay gap reporting obligations for employers with at least 100 employees.

The reporting timeline is phased:

• Employers with 250 or more employees must report by 7 June 2027 and then annually.
• Employers with 150 to 249 employees must report by 7 June 2027 and then every three years.
• Employers with 100 to 149 employees must report by 7 June 2031 and then every three years.

These new reporting requirements will apply alongside Italy’s existing gender equality reporting obligations for employers with 50 or more employees.

When a Joint Pay Assessment May Be Required

Employers may be required to conduct a joint pay assessment if reporting identifies an unexplained gender pay gap of at least 5 percent in any category of workers performing the same work or work of equal value.

This applies where the gap cannot be justified by objective and gender neutral criteria and has not been corrected within six months.

This means employers need to move beyond reporting alone. They must also be able to analyse pay gaps, understand the reasons behind them and take action where needed.

What This Means for Employers in Italy

Italy is now one of the first EU countries to formally implement the EU Pay Transparency Directive.

Employers operating in Italy should review their recruitment processes, pay structures, job evaluation frameworks, pay data and employee communication. The ability to explain how pay is set, how roles are compared and how pay differences are addressed will be central to compliance.

For HR and Rewards teams, the priority is now practical preparation. Pay transparency is already in force in Italy, and employers need to ensure their processes, documentation and systems are ready.