Gender Pay Directive: new rules for equal pay by 2027
- Economy
From 1 January 2027, the European Gender Pay Directive (GPD) will come into effect. This legislation requires companies to be transparent about pay differences between men and women. In the Netherlands, the directive will be implemented under the Equal Pay Transparency Act. Large organisations with more than 250 employees must report their Equal Pay Gap (EPG) annually, while medium-sized organisations with over 100 employees will need to report every three years. If a pay gap exceeds 5%, companies must take action to close the gap.
Gerarda Westerhuis, sector economist at ABN AMRO, analysed the impact of this legislation on the Dutch ‘Business Economy’ sector. Her findings show that over 2,000 companies with 250 or more employees will fall under the new rules, affecting around 1.4 million workers directly. A CBS study reveals that 61.6% of large companies in the Netherlands currently have a pay gap where women earn at least 5% less per hour than men. In 5.4% of these companies, men earn 5% less per hour than women. These statistics highlight the urgency for organisations to prepare for compliance with the new regulations.
While most companies are optimistic about meeting these requirements, research shows that many organisations still lack insight into their pay differences. ABN AMRO advises businesses to act now by conducting a baseline measurement, adjusting job evaluation systems, and training HR teams. These steps are crucial to meet legal standards and ensure equal pay.
Equal pay has been a priority for ABN AMRO for years. Since 2022, the bank has conducted annual research into pay differences, focusing specifically on higher management positions. The bank also offers training on unconscious bias and has established mentoring programmes to foster inclusion. On 24 November, ABN AMRO will share its progress and continue to work towards equal opportunities and fair pay.