Pay transparency is a set of new obligations that Directive (EU) 2023/970 on equal pay for women and men brings into Czech law. Under the government bill amending the Labour Code, from 1 January 2027 employers will have to tell applicants the minimum pay, will not be allowed to ask about their previous pay, and will need a written pay system and benefits system. From 2028, employees will gain the right to information on the average pay of women and men, employers will report gender pay gaps, and a pay assessment will be mandatory where an unjustified gap of at least 5% is found. In this article, we provide an overview of the changes with practical examples.
The EU is introducing pay transparency because the principle of equal pay for women and men has applied for decades but is hard to enforce in practice: employees do not know what colleagues doing comparable work earn, so they cannot detect or prove inequality. Directive (EU) 2023/970 therefore does not create a new ban on discrimination; instead, it gives employees access to information and imposes on employers rules on how they must set up and explain pay.
The explanatory memorandum to the Czech bill cites several figures showing why the change matters for the Czech Republic as well:
Status in the Czech Republic: The government approved the bill at the turn of August and September 2026, i.e. only after the transposition deadline had passed. The overview below is based on the government bill and its explanatory memorandum; it is a draft act whose wording may still change in Parliament. The same amending act also contains related changes concerning platform work and a new definition of dependent work.
For the purposes of pay transparency, pay means wages, salary or remuneration under an agreement, and all other cash and in-kind benefits that the employer provides in connection with employment (Article 3 of the Directive). The Czech bill therefore refers in all new obligations to “remuneration for work and other cash benefits and benefits in kind”.
Pay also includes bonuses, overtime compensation, travel allowances, housing and food allowances, compensation for attending training, severance pay, statutory sick pay, mandatory compensation and occupational pensions.
Work of equal value is assessed using objective, gender-neutral criteria. The Directive names skills, effort, responsibility and working conditions; the Czech bill keeps the criteria in Section 110 of the Labour Code – the complexity, responsibility and difficulty of the work, and where relevant the difficulty of the working conditions. Key points:
From 1 January 2027, employers will have two new obligations in recruitment: to tell applicants the minimum pay and benefits and not to ask about their current or previous pay (Section 30 of the Labour Code, Article 5 of the Directive). Both rules also apply to agreements to perform work outside an employment relationship (DPP and DPČ).
Practical example: A company is looking for an accountant. Its job advertisement states “salary from CZK 42,000 per month, meal allowance, 5 weeks of holiday”. It has fulfilled its information obligation towards everyone who responds to the advertisement. If, however, a recruiter approaches a candidate directly via LinkedIn, the recruiter must provide the same information to her in a verifiable way, ideally in the first message.
The employer may not request information about the wage, salary or benefits from the applicant's current or previous employment. The aim is to prevent past pay inequalities from being carried over into the new job.
Asking about previous pay can lead to a fine of up to CZK 200,000, as can failing to meet the information obligation towards the applicant.
From 1 January 2027, every employer will need a written pay system that divides jobs into groups according to their value and, if it provides benefits, also a benefits system with objective criteria. The system is agreed in a collective agreement; otherwise the employer sets it out in an internal regulation. The bill contains no exemption for small employers.
If an employer already has such a system and it meets the new requirements, it does not need to change it. The Ministry of Labour and Social Affairs will prepare a voluntary tool for job evaluation. The pay system must be discussed with the trade union, if one operates at the employer. For public-sector employers, the role of job groups is played by salary grades under the implementing regulations.
The system must contain objective and non-discriminatory criteria under which benefits are provided. It does not have to cover benefits whose amount is set directly by law where the employer does not depart from it.
Practical examples from the explanatory memorandum:
Pay agreed in a contract other than the employment contract or a collective agreement will have to be agreed in writing. Failure to observe the form is a breach of the law, but the agreed pay remains valid – once performance has begun, invalidity cannot be invoked.
Failing to set up a pay system can lead to a fine of up to CZK 1,000,000; a missing benefits system to a fine of up to CZK 400,000.
From 1 January 2028, employees will have the right to request in writing information on their own pay and on the average pay of women and men in their job group for the previous calendar year. The employer must reply in writing within 2 months (Section 306b of the Labour Code, Article 7 of the Directive).
Practical examples from the explanatory memorandum:
If a reply would reveal the pay of a specific colleague, the employer does not give that part to the employee and passes it only to a trade union designated by the employee. The union assesses the data and recommends a course of action to the employee. If no trade union operates at the employer, the employee will not receive the complete information. The explanatory memorandum lists typical situations where disclosure is a risk:
No fixed threshold for the number of employees is set; the assessment is the employer's responsibility.
The ban on pay confidentiality clauses has already applied since 1 June 2025. The bill extends it to benefits as well. The employer may only restrict in writing the use of data on average pay obtained on request to the purpose of equal pay; employees are free to deal with information about their own pay as they wish.
Gender pay gap reports will apply to employers with 150 or more employees from 2028 and with 100 or more employees from 2031. The system has two parts: the ministry prepares a general report from data it already holds, and the employer itself prepares a more detailed report by job group (new Sections 37e to 37j of the Labour Inspection Act, Article 9 of the Directive).
| Employer size | Frequency | First report |
|---|---|---|
| 250 or more employees | every year | 2028 (for 2027) |
| 150–249 employees | every 3 years | 2028 (for 2027) |
| 100–149 employees | every 3 years | 2031 |
| fewer than 150 (until 2030) or 100 employees | voluntarily, on request by 10 March | – |
The ministry does not publish the job-group report. Temporary agency workers will only be counted towards the user undertaking's headcount from 2031. Compared with the Directive's timetable, which envisages the first reports by 7 June 2027, the Czech rules thus postpone the first reporting by a year.
An employer must carry out a pay assessment if its report shows, in any job group, a gap of at least 5% in the average hourly pay of women and men that it does not justify by objective criteria and does not remedy within 6 months. It then has 2 months to complete the assessment (new Sections 287a to 287e of the Labour Code, Article 10 of the Directive). The obligation applies only to employers that prepare the job-group report and is to apply from 2028.
What can justify a gap: mainly working conditions, work performance and results (Section 110 of the Labour Code), for benefits the criteria in the system under Section 306a; in the public sector, the rules of the salary regulations.
Practical example: The report for 2027, made available on 30 April 2028, shows a 7% gap to the detriment of women in the “logistics specialist” group. Performance can explain only part of the gap. If the employer does not close the rest by 30 October 2028, it must carry out a pay assessment by 30 December 2028 at the latest.
During their assignment, temporary agency workers will be covered by the user undertaking's pay system (new Section 309b of the Labour Code). Before agreeing pay, the employment agency must obtain the user's consent to its amount and structure, and the user must provide the agency with information on the relevant job group and any changes to it. From 2028, the user must also cooperate with the agency in answering employees' requests; the agency is bound by confidentiality, including after the assignment ends. The agency will in principle set up its own pay system only for its permanent staff.
Public sector: the transparency rules also apply to employers paying salaries. The same bill also abolishes the minimum levels of guaranteed salary; the lowest salary tariff will have to be at least equal to the minimum wage, and adjacent salary grades will have to differ by at least 4%.
Employers face fines from the labour inspectorate of up to CZK 1,000,000, and in disputes the employee's position will be significantly strengthened.
| Breach | Fine up to |
|---|---|
| failure to set up a pay system, breach of pay assessment obligations, failure to meet job-group report obligations | CZK 1,000,000 |
| missing benefits system, failure to make the report available to employees or representatives, failure to cooperate with the agency, restricting employees in dealing with information on their pay | CZK 400,000 |
| failure to provide information to an employee, asking an applicant about previous pay, failure to meet the information obligation towards an applicant | CZK 200,000 |
| Date | What takes effect and when certain obligations are expected to start |
|---|---|
| 1 June 2025 | ban on pay confidentiality clauses (the “flexi-amendment”) |
| 7 June 2026 | end of the Directive's transposition deadline |
| 1 January 2027 | pay information for applicants, ban on asking about previous pay, pay system and benefits system, pay agreed in writing, extended ban on pay secrecy, rules for temporary agency workers, shift of the burden of proof, compensation for non-pecuniary harm |
| 1 January 2028 | gender pay gap reports (150+ employees), employees' right to information on average pay, making the report available to employees, pay assessment |
| 2031 | reporting also for employers with 100–149 employees, temporary agency workers counted |
The dates are based on the government bill and may shift during the legislative process.
The Pay Transparency Directive does not change the rule that equal work or work of equal value deserves equal pay – it changes how that principle is proved. Employers will need to have their pay described in a system, be able to explain it to applicants and employees, and – in larger companies – regularly measure and remedy gaps between women and men. Most of the work lies in preparing the pay system and benefits system, which are to apply as early as 1 January 2027.
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Answers to the questions our clients ask us most often.
No, the bill does not introduce an obligation to state pay directly in the job advertisement. However, the employer must inform the applicant in a verifiable way of the minimum wage or salary and of benefits, no later than before concluding the employment contract or agreement (Section 30(3) of the Labour Code). The advertisement is the simplest way to meet this obligation; the information can also be given by e-mail or in another verifiable way, typically at the first contact or before the interview. A breach can lead to a fine of up to CZK 200,000.
No. Under the proposed Section 30(2) of the Labour Code, the employer may not request information about the wage, salary or benefits from the applicant's current or previous employment. The ban also applies to agreements to perform work outside an employment relationship; the fine is up to CZK 200,000. It remains permissible to ask about salary expectations, to use market pay benchmarks and to take note of information the applicant volunteers on their own initiative.
Yes. The bill sets no exemption based on headcount for the obligation to set up a pay system (Section 109a of the Labour Code) – so it also applies to small companies, in both the private and public sectors. The system must be agreed in a collective agreement or set out in an internal regulation and must divide jobs into groups according to their value (complexity, responsibility, difficulty). If the employer provides benefits, it must also have a benefits system (Section 306a). The obligation is to apply from 1 January 2027; failing to set up a pay system can lead to a fine of up to CZK 1,000,000.
Not necessarily. According to the explanatory memorandum to the bill, if an employer already has an internal pay system in place, including job evaluation and division of jobs into groups, and the system meets the requirements of the new rules, it does not need to be changed. It is, however, necessary to check that the value of jobs is derived only from permissible criteria (complexity, responsibility, difficulty and, where relevant, working conditions) and that the system also covers benefits. The Ministry of Labour and Social Affairs is to prepare a voluntary job evaluation tool.
Once per calendar year. An employee may request in writing information on their own pay and on the average pay of women and men in their job group for the previous calendar year; the employer replies in writing within 2 months (Section 306b of the Labour Code). The request can also be made through a trade union, a works council or the Public Defender of Rights (Ombudsman). If the reply would reveal the pay of a specific colleague, that part is given only to a trade union designated by the employee. Under the bill, the right is to apply from 1 January 2028.
Under the bill amending the Labour Inspection Act, the reports apply to employers with 250 or more employees every year and employers with 150 to 249 employees every 3 years, for the first time in 2028 for the year 2027. From 2031, the lower threshold drops to 100 employees. The ministry prepares the basic report from the employer's single monthly report; the employer itself prepares a pay gap report by job group, discusses it with the trade union, sends it to the ministry by 30 April and makes it available to employees.
If the job-group pay gap report shows, in any group, a gap of at least 5% in the average hourly pay of women and men, and the employer does not justify it by objective criteria and does not remedy it within 6 months, it must carry out a pay assessment within 2 months (Sections 287a to 287e of the Labour Code). The assessment contains an analysis of the causes and corrective measures with deadlines; it is discussed with employee representatives and made available to employees and the ministry. The obligation is to apply from 2028, and a breach can lead to a fine of up to CZK 1,000,000.
No. The ban on pay confidentiality clauses has applied in the Labour Code since 1 June 2025 (Section 346a). The bill extends it to information on benefits and other payments the employee receives from the employer. Only the use of data on average pay that the employee obtains on request can be restricted – the employer may specify in writing that it may be used only to exercise the right to equal pay. Employees are free to deal with information about their own pay as they wish.
Under the bill amending the Labour Inspection Act, a fine of up to CZK 1,000,000 can be imposed for failing to set up a pay system, failing to carry out a pay assessment or failing to meet the obligations relating to the job-group pay gap report. Fines of up to CZK 400,000 apply, for example, to a missing benefits system or failure to make the report available to employees, and up to CZK 200,000 to failure to provide information to an employee, asking an applicant about previous pay or failing to meet the information obligation towards an applicant. In addition to fines, in court proceedings the burden of proof may shift to the employer and compensation for non-pecuniary harm may be awarded.
