Pay transparency: a new law for fairness in Italy coming down the road

An important new transparency requirement touching employee salaries is about to be introduced into the Italian legal system.

Following the introduction of more stringent transparency rules on working conditions in 2022 – on the basis of EU Directive 2019/1152 (transformed into Italian law with Legislative Decree no. 104/2022) – a new issue is now on the line with a deadline of June 7th, 2026: the obligation to implement into Law another important EU Directive – EU Directive 2023/970 - on pay transparency.

This represents another significant step in the EU's strategy to improve working conditions through the introduction of more stringent transparency rules on employment conditions, which directly affects the information to be disclosed during the hiring process and throughout the employment relationship.

The 2019 Directive had emphasized the obligation of reporting more precisely than in the past the elements that make up a worker's salary - including contributions in cash or in kind, overtime payments, bonuses, and other compensation, received directly or indirectly as a result of the employment relationship - without prejudice to the employer's freedom to provide for additional remuneration components, such as one-off payments.

With the new 2023 Directive the theme of pay transparency increasingly comes into play as a strategi...