Pay transparency in hiring: what’s changing for employers and candidates

EU Directive 2023/970 is reshaping hiring rules. Here's what companies need to know.

Pay transparency is becoming one of the central topics for the HR world. For years, many companies have treated compensation as information to share only in the final stages of hiring. The new European regulatory framework is changing this, and fast.

EU Directive 2023/970 is pushing organisations to adopt more transparent processes in compensation management and talent acquisition. This shift goes beyond regulatory compliance. It directly affects recruiting, employer branding and candidate experience.

In this article you will discover:

What is pay transparency and why it matters.
The EU Pay Transparency Directive 2023/970.
Why pay transparency matters in recruiting.
How to prepare for the shift.

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What is pay transparency?

Pay transparency is an approach to compensation management that makes the criteria used to determine salaries, career progressions and pay raises clearer and more accessible.

The goal is to ensure that these decisions are based on objective and verifiable criteria such as skills, responsibilities and experience. In recent years, the topic has become increasingly relevant because lack of transparency has been identified as one of the main drivers of the gender pay gap.

This is why the European Union has introduced measures to strengthen the principle of equal pay for equal work or work of equal value.

EU Directive 2023/970: an overview

Published in 2023 and transposed in Italy through Legislative Decree no. 96/2026, EU Directive 2023/970 was introduced to strengthen the principle of equal pay between men and women.

The regulation introduces measures to:

increase pay transparency
reduce the gender pay gap
guarantee access to salary information
strengthen protection against discrimination

This is a change that affects all organisations, with progressive obligations related to transparency and reporting.

Why pay transparency matters in recruiting

Compensation is playing an increasingly central role from the very first stages of the hiring process.

For companies, this means a direct impact on:

attractiveness of job openings
quality of applications
management of the candidate experience

Ignoring this shift means risking the loss of top candidates before the hiring process has even begun.

How to prepare for the shift

The main changes affect the hiring process directly:

job postings will need to include a salary or an indicative pay range
the principle of transparency in hiring processes is being strengthened
the weight of information on a candidate’s salary history is progressively reduced

In this context, it becomes essential for companies to rethink their HR processes coherently, from job postings to compensation policies, through to the management of internal information.

Frequently asked questions

When does pay transparency apply in Italy?: With the transposition of EU Directive 2023/970 through Legislative Decree no. 96/2026, Italian companies are required to progressively comply with the new transparency obligations in compensation management and hiring processes.
Will job postings always need to include a salary?: Yes, one of the main changes requires job postings to include a salary or an indicative pay range, progressively reducing the weight of a candidate’s salary history in the hiring process.
How can a company prepare for the change?: By reviewing HR processes coherently, from job postings to compensation policies, and relying on tools like nCore HR that help standardise information and centralise data and workflows with transparency in mind.

Coming soon — the pay transparency operational guide: how nCore HR supports the shift in HR processes

Pay transparency represents a structural transformation for the HR world. On one hand, it introduces new regulatory obligations for companies; on the other, it is redefining how recruiting and compensation policies are managed, with increasingly transparent and structured processes.

Addressing this change requires not only regulatory compliance, but also an operational evolution of HR processes. In this sense, digital tools like nCore HR can support companies in managing the transition on a daily basis, making compliance an integral part of their workflows.

In particular, nCore HR enables companies to:

standardise and maintain consistent compensation information across job postings;
improve the quality and clarity of job descriptions through AI;
centralise HR data and processes through structured workflows and audit logs;
monitor recruiting KPIs and relevant information also in terms of reporting and transparency.

These elements make it possible to turn a regulatory obligation into a process that is more manageable, integrated and measurable within the HR function.

Coming soon — the pay transparency operational guide, with practical tools, concrete examples and operational guidance to support the implementation of EU Directive 2023/970 and address the shift in HR processes in a structured way.