At a Glance

• Italy has approved a draft legislative decree to transpose the EU Pay Transparency Directive into national law.
• The decree clarifies the criteria for identifying "equal work" or "work of equal value," sets forth rules for making pay disclosures at the recruitment stage and during employment, and addresses pay reporting obligations, among other steps.
• While the draft decree is at the preliminary stage and may undergo revisions, employers in Italy should begin evaluating their current pay practices and classification systems in light of new requirements.

On February 5, 2026, Italy’s Council of Ministers approved a draft Legislative Decree implementing Directive (EU) 2023/970 on pay transparency. Following its preliminary approval, the measure now enters a review and consultation phase—an important step in ensuring that Italy meets the June 7, 2026 deadline to transpose the Directive into national law.

The draft decree reshapes corporate practices in compensation management. Pay equality will no longer be left to the discretion of voluntary corporate best practices but must be grounded in a comprehensive system of rules based on transparency and information. The core objective of the Directive, and by extension, Italy’s draft decree, is to reduce the gender pay gap by tackling pay discrimination between men and women through the application of the principle of equal pay for "equal work" and for "work of equal value."

Below are the key features of the draft...

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