The Pay Transparency Directive (Directive (EU) 2023/970 of the European Parliament and of the Council of 10 May 2023 to strengthen the application of the principle of equal pay for men and women for equal work or work of equal value through pay transparency and enforcement mechanisms) is currently being transposed into the Austrian legal system. Austria has until 7 June 2026, to complete this implementation. While the general content of the draft law is already known, it is not yet in its final form.

Despite the pending final legislation, employers can already begin preparing and take initial steps.

Establishment of Directive-Compliant Structures

The objective of the legislation is for companies to establish pay structures that ensure no pay differences between workers performing equal work or work of equal value occur that are not justified by objective, gender-neutral criteria. These pay structures must enable a comparison of the value of different tasks within the same organizational structure.

To achieve this, employers are required to define categories of workers. Workers performing equal or equivalent work must be classified into specific groups in a non-arbitrary manner based on non-discriminatory, objective, and gender-neutral criteria. In accordance with the Directive, these criteria should encompass the four factors of skills, effort, responsibility, and working conditions, as well as any other factors relevant to the specific workplace or position, provided they remain gender-neutral.

To facilitate the allocation of workers to individual categories, companies can create a list of all workers and an organizational chart, subsequently defining the categories based on the established criteria and assigning the workers accordingly. In this process, job descriptions (including task characteristics, scope, and requirement profiles) should be reviewed, at minimum, regarding the four aforementioned criteria.

Preparation of Information Disclosure

Furthermore, processes for the implementation of the workers right to information and, where applicable, the reporting obligations of employers should be established. The information provided to workers must include general criteria for determining pay levels and career progression. It also includes individual pay levels and - broken down by gender - the average pay level for the specific group to which the worker belongs. To support these processes, employers must ensure the availability and quality of the necessary data in advance.

Review of the Application Process

Employers should also ensure that job vacancy and job titles are kept gender-neutral. Additionally, recruitment processes must be led in a non-discriminatory manner to ensure the right to equal pay is not undermined

Comparison with the Actual State

Based on the steps outlined, companies should be conducted by analysing existing pay structures (including variable components of pay and all other remuneration received directly or indirectly, whether in cash or in kind, by reason of the employment relationship). This analysis serves to identify pay differences between female and male workers and to determine their underlying causes.

Summary

The final content of the legal transposition of the Pay Transparency Directive remains pending. Nevertheless, employers may already initiate preparatory measures to ensure that a portion of the necessary processes is established upon the entry into force of the statutory regulations in the Austrian legal order, subsequently requiring only potential adjustments