In the current Polish labour market, disclosure of salaries by employers is standard only in certain industries, particularly in the IT sector. Many employers do not disclose salary information to protect company secrets. Hence, it appears, that the norm is not to disclose salary ranges in recruitment advertisements, use of salary secrecy provisions and for employers to increasingly rarely set pay grades, which translates into less disclosure of salaries in organisations.
At the same time, the lack of wage openness contributes to the perpetuation of the gender wage gap, which reaches 12.7% in the European Union, according to Eurostat data from 2021. In Poland, according to various sources, the wage gap ranges from 4.5% to almost 20%. Differences in estimates are due to the methodology adopted, in particular whether the so-called raw wage gap, which is the difference between the average wages of employees of both sexes, or the so-called adjusted wage gap, which is a measure of the difference in wages between men and women with similar characteristics (e.g. age, education level, length of service) or employed in similar positions, is studied.
The above problems are to be overcome by 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 equal work or work of equal value between men and women through pay transparency and enforcement mechanisms.
Although member states have until 7 June 2026 to implement the directive into their national legal orders, it is already worth looking at the extent to which the directive will oblige employers to disclose wages at the recruitment stage, and how the disclosure of wages during employment will evolve.
Transparency of salaries for job candidates
Salary transparency at the recruitment stage is considered an important element in eliminating wage discrimination. In practice, a kind of “side effect” of this transparency is the strengthening of job candidates’ bargaining position.
According to the directive, job seekers will be entitled to receive information from their prospective employer on, among other matters, the starting salary or respective salary range for the position. This concerns not only the basic salary, but also any other cash or in-kind benefits received by the employee directly or indirectly (e.g. bonuses, allowances, vouchers). As the directive indicates, this is not intended to limit in any way the bargaining power of the employer or employee in negotiating remuneration outside the indicated range. Instead, the provision of the above salary information is intended to overcome information asymmetry and to support the related job candidates’ bargaining positions.
This information should be provided in such a way as to ensure informed and transparent salary negotiations, for example in a published vacancy announcement, prior to an interview or otherwise. Thus, the directive does not imply an obligation to provide salary information in every recruitment advertisement, although certainly from the perspective of job candidates such a solution would be most desirable. Interpretation of the provision indicates that such information can also be made known to a job candidate in other ways, for example, individually in an invitation to an interview. It is important that the manner, including the timing of such information, ensures informed and transparent negotiations.
Equally interestingly, the directive expressly prohibits asking job seekers questions about their salary in their current or previous employment. Again, this rule is intended to level the bargaining playing field by creating circumstances for employees to obtain a stronger bargaining position concerning remuneration. However, it does not preclude a job candidate from providing such information on their own initiative, for example, when, in their judgment, this will speed up or facilitate salary negotiations. From the perspective of HR departments, it will therefore be necessary to review interview scenarios to ensure that no question about a job candidate’s current or previous salary is asked.
Transparency of salaries during employment
Regarding disclosure of salaries in the course of employment, the directive obliges employers to ensure that their employees have easy access to the criteria used to determine their remuneration, as well as the levels and progression of remuneration. Thus, for example, the implementation of this obligation can be done by including the above criteria in an appendix to the remuneration regulations or in the form of a summary on the employer’s intranet. Importantly, employers with fewer than 50 employees may be exempted from the progression obligation (understood as the process of moving an employee to a higher level of pay), provided that an appropriate provision is made in national law.
The directive also introduces an employee’s right to request and receive information on their individual pay level and average pay levels, broken down by gender, for categories of employees doing the same work or work of equal value. Employers will be required to provide the aforementioned information within a maximum of two months from the date of the request, with the understanding that if the information provided proves to be inaccurate or incomplete, the employee will be able to request additional clarification of any data provided. Moreover, employers will be required to inform employees once a year of the above rights and the steps to be taken to exercise them.
The above is, of course, intended to implement the principle of equal pay. In practice, however, it will probably often assist the employee’s preparation for negotiating a pay increase, without necessarily aiming to obtain the right to equal pay.
Confidentiality
Employers will be able to require employees who have obtained information about other than their own pay or pay levels not to use such information for any purpose other than exercising their right to equal pay. However, effective enforcement of this requirement will probably fall far short of employers’ expectations.
At the same time, it is clear from the directive that it will be unacceptable to prevent employees from disclosing their pay for the purpose of enforcing the principle of equal pay. As a general rule, it will be prohibited to introduce provisions, particularly in the employment contract, that prevent employees from disclosing information about their pay. At present, such a prohibition does not arise directly from Polish labour laws, but under certain conditions the prohibition of abuse by employers of so-called “confidentiality” or “secrecy” clauses on employee salaries is inferred by court rulings (e.g., Supreme Court ruling of 26 May 2011, II PK 304/10). The above does not mean, of course, that an employee will be completely free to convey information about his salary – for example, to the employer’s competitors in a way that violates his interests.
From the perspective of confidential information, Article 12 of the Directive is also noteworthy. According to this, no personal data processed in connection with an employee’s right to information regarding remuneration may be used for any purpose other than the application of the principle of equal pay. In addition, member states may stipulate that where the provision of information to an employee would lead to the disclosure, either directly or indirectly, of the salary of an identifiable co-worker, only employee representatives, the labour inspectorate or an official equalities organisation will have access to that information. These issues can be particularly challenging at small employers with a fairly simple organisational structure, as well as at employers with stand-alone, unique positions.
Summary
While the already existing positions on so-called “confidentiality” or “secrecy” of salaries will likely only be confirmed as a result of the directive’s implementation, the employer’s information obligations regarding salaries to employees and job candidates will be a significant novelty in Polish labour laws.
It appears that the mechanisms introduced will minimise asymmetry in salary negotiations both at the recruitment stage and during employment, and will strengthen employees’ bargaining position. In addition, they will certainly affect employee awareness, which may in turn increase the number of disputes over equal pay.
Natalia Gałązka, Joanna Dudek
