Wages under pressure from transparency: a legislative change that will test corporate culture

Many companies today perceive equal pay as one of many topics for human resources departments. However, we must not forget that most fundamental changes in companies come inconspicuously, and management only realises their true impact when it is too late. This is exactly what may happen in the area of equal pay and the planned transparency rules.

The upcoming legislation on equal pay may, within a few years, reveal what many companies have been hiding under the surface their entire lives – unclear rules, historical differences, personal exceptions and unnamed compromises. And all this in an environment where employees will have significantly stronger rights to ask questions, compare and demand explanations.

What is actually changing – and why should you care?

The European Directive on Transparency of Remuneration (EU 2023/970), which the Czech Republic must implement by mid-2026 at the latest, changes the view of wages and remuneration in several fundamental ways:

• employees will have stronger rights to information about their own remuneration and that of comparable colleagues
• companies will have to be able to demonstrate why some people earn more and others less, based on objective criteria (e.g. skills, responsibility)
• companies with more than 100 employees will be required to report differences in remuneration between women and men
• Transparency will already be reflected in recruitment – candidates should be clear in advance about the salary or salary range for a given position

And there is another fundamental change: the Unified Monthly Employer Report (JMHZ), which will significantly transform the administrative and data infrastructure in the area of employee administration from 2026.

In other words, companies will have more obligations, and the state administration will receive complete and detailed data through the JMHZ. Companies will lose room for "improvisation," and state authorities will gain clear indicators for their inspections.

Why is this not just a legal and HR issue, but a strategic issue for company management?

You may be thinking, "We have a payroll system, we have rules for remuneration and defined roles. HR will deal with the new legislation...". If you already have a system in place today, that is certainly a good foundation, but equal pay is not just about tables and guidelines. It is an intervention in the very DNA of your organisation:

• how you signal to your employees
• what your culture is like
• how candidates perceive you
• and how much people trust you

In an environment where there is a shortage of employees, where the younger generation pays much more attention to corporate values, and where information circulates faster than ever before, non-transparent and unsystematic remuneration can significantly weaken your employer brand. What's more, if you yourself are unable to explain why one person has a higher salary than another in a similar position, sooner or later you will have a problem.

What every company will need to master

If the new requirements could be summarised in one sentence, it would be:

Every salary and reward must be justifiable – with numbers, criteria and logic.

In practice, this means that a company must have:

• Clearly described roles and their value to the company: The job title and description of the work performed are not enough. A point scale must be used to define what constitutes "work of equal value" in terms of responsibility, complexity, knowledge, impact and difficulty.
• Objective criteria for determining wages: Typically, these are experience, level of education and qualifications, performance, responsibility, complexity of the agenda, managerial role, and impact on the business. Personal sympathies, "that's how it's always been done", pressure from employees or market conditions unrelated to internal logic do not apply.
• Transparent salary and remuneration system: Not necessarily public salaries, but a system that is internally understandable, auditable and sustainable in the long term.
• Data and the ability to explain it: In the future, it will no longer be enough just to pay. Employers will have to be able to explain differences in remuneration, document objective criteria and report structured data. The burden of proof lies on their side – they must demonstrate transparency and fair remuneration settings. This means not only preparing internal processes, but also being able to defend decisions before employees and supervisory authorities.

How to prepare for the new legislation?

If a company is to manage equal and transparent remuneration without chaos, emotions and reputational damage, cosmetic changes to the pay scale are not enough. In fact, it is a systematic transformation project with clear steps:

1. Analysis of existing documentation and practices

• Review the current pay scale, work guidelines and remuneration policy.
• Assess whether the rules are actually used in practice or only exist "on paper".
• Identify where the wording is vague, ambiguous or overly dependent on individual decision-making.

The goal is not only to check compliance with the law, but to understand how remuneration is actually determined in your company today.

2. Create an evaluation table and point system

This is a key step that many companies have not implemented, yet without it, equal pay is practically impossible to achieve.

• It is necessary to create an evaluation table for the point-based assessment of work, which will be based on objective factors such as the difficulty and complexity of the work, the level of responsibility, the impact on the business, the required competencies and qualifications, independence and decision-making powers, workload, stress and liability for damages.
• Based on this table, you can then categorise all positions in the company, assign them points, and create a logical structure of pay levels.

This will give you a rational and defensible basis on which to build.

3. Cross-company comparison

Once the positions have been scored, it is necessary to:

• compare the actual wages of employees with these categories,
• analyse the differences between men and women,
• look not only horizontally (same specialisation) but also vertically (across the entire company).

The aim is to identify where remuneration corresponds to the system and where it is the result of historical compromises.

4. Identifying and resolving anomalies

Almost every company encounters various "anomalies" where:

• someone has a significantly higher salary without a clear systemic reason,
• there are differences between branches, teams or individuals,
• historical exceptions have lost their justification.

These situations cannot simply be "smoothed out with a table". They must either be rectified by adjusting salaries, described transparently and systematically, and then justified (e.g. specific role, key expert, etc.). It is important that no deviation remains "unexplained".

5. Preparation of a rectification plan

Not everything can be resolved immediately, and the state is aware of this.

Therefore, it is essential to:

• prepare a realistic and gradual plan to rectify wage discrepancies,
• set priorities (critical differences, risky positions, key roles),
• prepare a timetable for implementing individual changes.

This plan should be linked to budget planning and HR strategy.

6. Internal communication – the key to success

This step will determine whether the change will strengthen or disrupt the corporate culture.

Employees will need to be given a clear and open explanation of the changes.

• explained clearly and openly,
• communicate that the goal is not just to comply with the law, but to ensure long-term fairness,
• prepare them for the fact that some positions will change, while others may not change immediately,
• work sensitively with emotions – because remuneration is always a personal issue.

Well-managed communication can transform the entire process from a crisis project into a confidence-building exercise.

7. Ensuring long-term sustainability

This is not just a one-off audit, but a systemic change and a process that will evolve.

The company must therefore set up:

• regular reviews of the system,
• links to the career and performance system,
• ongoing updates to the evaluation table based on role and market developments,
• training for managers so that they know how to work with it.

Only then will it become a living, functioning organism rather than just another directive gathering dust in a drawer.

The biggest mistake you can make today is to put it off, saying, "It's still not clear how exactly it will work." This rarely happens with strategic changes. Those of you who start addressing equal pay in time will have peace of mind and the following advantage in the labour market.

Many companies tend to deal with these issues on their own. However, experience shows that having an independent partner on hand for such a sensitive change, who looks at the issue without internal emotions and knows its legislative, HR and strategic context, can significantly calm and speed up the whole process.