The EU Pay Transparency Directive: A Strategic Imperative for HR Transformation

Jun 05, 2025
Oracle | 2 min READ
    
As organizations across the EU prepare for the sweeping changes brought by the EU Pay Transparency Directive (PTD), HR and compliance leaders are facing both a challenge and an opportunity. This legislation, aimed at ensuring equal pay for equal work, introduces a new era of mandatory pay transparency, data-driven reporting, and employee rights, fundamentally reshaping how pay practices are governed and communicated.
As organizations across the EU prepare for the sweeping changes brought by the EU Pay Transparency Directive (PTD), HR and compliance leaders are facing both a challenge and an opportunity. This legislation, aimed at ensuring equal pay for equal work, introduces a new era of mandatory pay transparency, data-driven reporting, and employee rights, fundamentally reshaping how pay practices are governed and communicated.
Mir Ali
Mir Ali

Sr Director -

Oracle Enterprise Solutions

Birlasoft

 
What’s Changing?
The PTD introduces several pivotal reforms, including:
  • Pay transparency before hiring: Employers must disclose salary ranges upfront.
  • Ban on pay secrecy and history inquiries: Conversations about prior compensation are off the table.
  • Gender-neutral pay and progression policies: Pay-setting criteria must be standardized and accessible.
  • Mandatory gender pay gap (GPG) reporting: Deeply granular and broad, far beyond current UK reporting standards.
  • Joint Pay Assessments: Triggered when a 5%+ gender pay gap is found and not objectively justified.
The scope is extensive – pay is broadly defined, including salary, bonuses, allowances, pensions, and even compensation related to training and dismissal.
Birlasoft’s Perspective: Turning Regulation into a Transformation Catalyst
For many organizations, meeting the PTD’s obligations will require new systems, processes, and capabilities, especially in pay data aggregation, job classification, and audit readiness. The complexity is heightened for multinationals juggling different national implementations across the EU.
But this isn’t just a compliance mandate. It’s a strategic opportunity to modernize HR, strengthen employer branding, and enhance employee trust – if managed with the right technology and partners.
Stay Ahead
Visit our Oracle HCM Cloud page
At Birlasoft, we see the PTD as a regulatory hurdle and a catalyst for digital HR transformation. With deep domain expertise in Oracle HCM Cloud and cross-industry HR implementations, we help organizations:
  • Modernize Pay Structures: We leverage Oracle’s Compensation and Workforce Rewards modules to help clients design and implement gender-neutral pay policies, salary bands, and progression paths.
  • Enable Real-Time Compliance Reporting: Our HCM analytics and data services enable the automatic generation of GPG reports aligned with EU standards, including complex pay definitions covering bonuses and in-kind benefits.
  • Build Transparent Talent Processes: From pre-employment salary disclosure to structured, auditable performance and promotion reviews, we help clients configure Oracle HCM to ensure compliance, fairness, and defensibility.
  • Empower HR Teams and Managers: We provide strategic advisory, change management, and system training to ensure your HR and leadership teams are ready to engage transparently and confidently in the new pay landscape.
  • Global Consistency with Local Flexibility: We support multinational organizations with local configurations and multilingual capabilities that enable both EU compliance and global consistency in pay equity governance.
The Time to Act Is Now
With the directive’s enforcement deadlines fast approaching, organizations should begin by:
  • Auditing existing pay and performance practices.
  • Evaluating current job structures and classifications.
  • Assessing their HCM system’s readiness for PTD-driven reporting.
  • Considering a “dry run” of the gender pay gap report.
Early compliance readiness de-risks operations and also signals to candidates, employees, and stakeholders that your organization is serious about fairness, equity, and sustainability.
As a trusted Oracle partner and digital transformation leader, Birlasoft combines industry knowledge with technology expertise to drive tangible outcomes. Our HCM solutions are tailored, scalable, and compliant – ready to support your journey toward pay equity, transparency, and operational excellence. Get in touch with our HCM experts to start now!
 
 
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