With Legislative Decree No. 96/2026, Italy has implemented EU Directive 2023/970 on pay transparency, introducing new provisions that are expected to significantly affect companies’ salary management policies and practices.

However, an initial review of the decree raises important questions regarding its actual consistency with the objectives pursued by the European legislator.

The Directive was adopted with the aim of making compliance with the principle of equal pay genuinely verifiable, addressing the difficulties employees often face in identifying and proving instances of pay discrimination. From this perspective, transparency is not an end in itself, but rather a tool designed to ensure the effective enforcement of anti-discrimination protections.

Certain provisions of the Italian decree, however, appear to limit the scope of disclosure obligations by placing greater emphasis on collective bargaining arrangements and on information already required under existing employment law. As a result, employees may still lack sufficient information to understand the reasons behind pay differences arising from individual salary supplements, discretionary bonuses, performance-related incentives, or other variable components of remuneration.

Particularly noteworthy is the provision that attributes significance to the application of collective bargaining agreements signed by the comparatively most representative trade unions. This may have important implications for assessing compliance with equal pay principles. It remains to be seen whether such an approach is fully consistent with the rationale of the Directive, which focuses on the ability to verify the specific criteria actually used by employers in determining individual remuneration.

For businesses, the risk is not merely one of legal interpretation.

Should national and European courts adopt a substantive interpretation of the new rules, transparency obligations may ultimately be assessed in light of the Directive’s objectives rather than the literal wording of the implementing decree. In such a scenario, it becomes essential for employers to establish remuneration systems based on objective, documented criteria aligned with employees’ responsibilities, skills, qualifications, and performance.

The new framework therefore requires companies to undertake a broader reflection that goes beyond mere formal compliance. The ability to demonstrate the neutrality and transparency of pay-related decisions will increasingly become a key factor in managing legal risk and preventing litigation concerning pay discrimination.

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