According to a recent analysis by Deloitte (https://www2.deloitte.com/cz/cs/pages/human-capital/solutions/pay-transparency-directive.html), most Czech companies are not yet ready to comply with new European rules on pay transparency, which will come into force in mid-2026. The rules, introduced by European Directive 970/2023, aim to reduce the gender pay gap by requiring the publication of average salaries for men and women in the same positions.
The analysis revealed that six out of ten employers in the Czech Republic do not know the true extent of the pay gap within their organization. Only 22% of companies have started preparing to comply with the new regulations, and a quarter of companies admit that they do not yet know how to deal with the transition.
The current situation in the Czech Republic
In the Czech Republic, the gender pay gap is 17.9%, well above the EU average of 12.7%. These differences not only penalize women in terms of payroll, but also have long-term consequences, such as the pension gap, which is around 30% in the EU.
The EIGE (European Institute for Gender Equality) Gender Equality Index is a useful tool to better understand these inequalities. This index assigns a score from 1 to 100, with 100 representing full gender equality, and allows comparison between European countries and a detailed view of their performance. In 2023, the Czech Republic ranks 25th in Europe with a score of 57.9 out of 100, which is 12.3 points below the European average.
The Index allows for deeper analysis by breaking down the data into six domains: work, money, knowledge, time, power and health. In the work domain, which assesses equality in access to employment and working conditions, the Czech Republic has improved by 1.8 points since 2020, although it remains below the EU average.
However, when looking at the sub-domain of labour force participation, the country ranks above the EU average, while showing lower results in terms of career prospects, highlighting that women continue to face greater obstacles in reaching high or well-paid positions.
This scenario highlights not only the need for targeted policies to reduce the pay gap, but also the importance of addressing inequalities in career opportunities and working conditions, which contribute to the Czech Republic falling behind European standards of gender equality.
The new Directive 970/2023
EU Directive 970/2023, adopted on 10th May 2023, is a breakthrough in the fight against gender pay inequality. It aims to ensure greater pay transparency, which is considered essential to prevent discrimination and promote equal treatment in the workplace. The legislation introduces a number of innovative measures requiring companies to make pay information more accessible and clear. Key obligations include:
- Right to information: Employees can access data on average pay levels for equivalent roles, broken down by gender.
- Pay transparency: companies with more than 100 employees must publish data on the pay gap, and those with a gap of more than 5% must carry out detailed analysis and take corrective action.
- No pay secrecy: companies must state salaries or salary ranges in job advertisements and may not ask about applicants’ previous salaries.
- Objective assessment criteria: salaries must be based on gender-neutral parameters such as skills and experience.
These measures are not only a step towards greater fairness, but also an opportunity for companies to improve transparency and trust in their employees.
Conclusions: Towards a more inclusive labour market
EU Directive 970/2023 provides an unprecedented opportunity to address gender inequalities in the European labour market. For the Czech Republic, however, the road to compliance will be challenging. Companies will need to invest not only in analytical tools and transparency, but also in a cultural change that promotes inclusion and values women’s skills.
If implemented correctly, this legislation can reduce structural inequalities, improve working conditions for women and strengthen companies’ competitiveness. A fairer labour market is not only a matter of social justice, but also a key factor in the economic and cultural progress of society as a whole.
https://www.consilium.europa.eu/it/policies/pay-transparency
https://eige.europa.eu/gender-equality-index/2023/CZ https://www2.deloitte.com/cz/cs/pages/human-capital/solutions/pay-transparency-directive.html
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