EU Pay Transparency Directive: Ireland joins the frontrunners

On 15 January 2025, the Irish Government published a General Scheme of the Equality (Miscellaneous Provisions) Bill 2024 which includes two provisions aimed at enhancing transparency prior to employment and transposing Article 5 of the EU Pay Transparency Directive. 

In this article, we take a look at the measures proposed in the draft Bill that relate to pay transparency and what employers with operations in Ireland need to be doing now to prepare for the implementation of the Pay Transparency Directive.  

The first measure proposed in the draft Bill relates to transparency at the job recruitment stage and in relation to the advertising of roles. It requires employers to provide information about salary levels or ranges in job advertisements. This goes slightly further than the Directive, which does not state that this information must be published in the job advert, but it is something that an applicant is entitled to ask for at any stage during recruitment. That said, for administrative reasons, employers were always likely to choose to publish pay ranges in the advert rather than respond reactively to individual requests. 

It is still not clear exactly how detailed the information on pay ranges will need to be, but we expect as this draft Bill progresses, it will ensure that employers cannot circumvent this new requirement by, for example, publishing very broad salary ranges.  

The second measure proposed in the draft Bill aimed at enhancing pay transparency is that employers are prohibited from asking job applicants about their own pay history or their current rate of pay, in line with Article 5 of the Directive. 

This is aimed at preventing employers from entrenching pay discrimination which may have started elsewhere. Currently, employers might ask about an applicant’s current salary and make an offer based on that. But if this applicant is a woman who was experiencing pay discrimination in her previous role, such an approach would only carry it over to the new position. This new measure aims to prevent this. 

The newly formed Irish government has only recently published its updated legislation programme which confirms the status of the Bill as being ‘in preparation’. It therefore remains uncertain whether this draft Bill will progress in its current form to become a formal Bill and eventually law.  

There are also other important individual employee rights to pay information set out in the Directive which are not addressed in the draft Bill. For example, measures in relation to the transparency of pay setting and pay progression policies, banning pay secrecy clauses and the right to information for “categories of workers performing the same work as them or work of equal value to theirs”.  

It is, therefore, possible that we may see further initiatives, or variations of the draft Bill aimed at implementing the Directive and we will continue to monitor this.  

In the meantime, and in anticipation of the new measures, employers need to: 

• Think more carefully about salary ranges that will need to be included in job advertisements.  

• If not already doing so, refrain from the practice of asking applicants about their current or previous salaries.  

• Consider how they will deal with pay information requests. This information must be provided within two months of the employee (or representative/body) making the request. Employers must remind employees of their right to this information on an annual basis, making sure the right to access pay information will remain top of mind for employees. Employers will need to set up efficient systems for dealing with these requests. 

• For the purpose of responding to pay information requests, employers will need to consider how they will identify which roles are “like work”, but also which are “of equal value”. In the latter, this could refer to two jobs which might be quite different but which, when properly analysed using job evaluation methodologies, can be determined to require the same level of skill, effort and decision making. Examples might be an IT Manager and a Finance Manager. 

• Remove any restrictions on employees concerning pay discussions, if such policies or rules exist. 

• Ultimately, employers need to start identifying and investigating pay gaps and areas where they could be exposed to allegations of bias or discrimination before this information is opened up to greater scrutiny.