Pay transparency software: what it does for the EU directive and US salary range laws

What the EU Pay Transparency Directive requires, and by when

The directive was adopted in May 2023 and entered into force the following month, with a transposition deadline of June 7, 2026. Before hiring, employers must tell applicants the starting pay or its range, in the vacancy notice or before the interview, and may no longer ask about pay history. Employees can request their own pay level and the average pay, by sex, of colleagues doing the same work or work of equal value, and employers must answer within 2 months.

Employers must also make the criteria behind pay levels and pay progression accessible, although member states may exempt employers with fewer than 50 workers from the progression part. Pay structures must rest on gender-neutral job evaluation and classification, and contract terms that stop workers from disclosing their pay are banned.

Reporting starts with the largest employers. Those with 250 or more workers report by June 7, 2027, and every year after; those with 150 to 249 report by the same date and then every 3 years; those with 100 to 149 report by June 7, 2031, and then every 3 years. Each report covers the previous calendar year, including the mean and median gender pay gap, the gap in variable pay such as bonuses and the share of women and men in each pay quartile.

If a report shows a gap of at least 5 percent in average pay in any category of workers, and the employer can neither justify it with objective, gender-neutral criteria nor close it within 6 months, a joint pay assessment with workers' representatives follows. Workers who suffered pay discrimination can claim compensation, and an employer that ignored the transparency duties must prove there was no discrimination. The Commission put the EU gender pay gap at 11.1 percent in June 2026.

Sources: [1][2][3][4][5][6]

EU transposition in September 2026: 5 countries done, most still drafting

Only 4 member states met the June 7, 2026, deadline with full transposition: Slovakia, Italy, Lithuania and Malta. Greece followed with Law 5316/2026, in force since July 6, 2026, with its main obligations applying from November 1, 2026. Poland and Estonia have adopted parts, chiefly pay information for applicants and the ban on pay history questions, in force since December 24, 2025, in Poland and July 13, 2026, in Estonia.

The rest were at the draft stage or earlier in late September. Spain published a draft Royal Decree on August 3, Portugal a government bill on August 5 and Bulgaria sent a bill to parliament on September 11, while in Germany a cabinet decision was only rumored for October. Where no national law exists yet, private employers are generally not bound by the directive's specific duties, although courts may read existing equal pay law in its light.

For software buyers, national detail matters more than the headline. Malta gives employers 8 days to answer a pay information request instead of the directive's 2 months, and in Lithuania the state social insurance fund, SoDRA, calculates the gap indicators from employer payroll data, with reporting from January 1, 2027. A tool that implements only the directive's defaults will be wrong in some countries.

Sources: [7][8][9][10][11][12][13][14]

US salary range laws: which states require pay in job postings

Colorado's Equal Pay for Equal Work Act has required employers since January 1, 2021, to announce job openings with their pay range. California and Washington followed on January 1, 2023, for employers with 15 or more employees. California defines the posted pay scale as a good faith estimate of the range the employer reasonably expects to pay, with civil penalties of $100 to $10,000 per violation, and Washington also requires a general description of benefits.

New York State's law has applied since September 17, 2023, to employers with 4 or more employees and covers jobs, promotions and transfers performed at least partly in the state, including remote roles that report to a New York supervisor or office. Illinois followed on January 1, 2025: employers with 15 or more employees must list pay and benefits in internal and external postings.

Reporting goes further in 2 states. California requires private employers with 100 or more employees to file annual pay data reports, most recently due May 13, 2026, and Illinois requires businesses with 100 or more employees in the state to hold an Equal Pay Registration Certificate, renewed every 2 years.

Similar rules exist elsewhere. Since January 1, 2026, Ontario has required employers with 25 or more employees to post an expected pay range no wider than C$50,000, plus a statement on whether AI screens applicants, and UK employers with 250 or more employees report their gender pay gap every year.

Sources: [15][16][17][18][19][20][21][22][23][24][25]

What pay transparency software does: 4 jobs in one tool

Most tools in this category do 4 jobs: they build a job architecture, analyze pay equity, produce the legal reports and publish pay ranges. Job architecture comes first, because every later step compares pay within groups of equal work.

European tools often lead with job evaluation. The German tool gradar matches its job families to external salary benchmark catalogs with a custom-trained AI model, and Paygaps.de has its AI rate each role against the directive's 4 evaluation criteria and calculates the gap per comparison group only after HR approves the ratings.

The equity analysis compares pay inside those groups and separates the raw gap from the gap left after legitimate factors such as experience or part-time status. In beqom, the Pay Gap Analyzer walks users through that regression, and Figures flags every raw gap above 5 percent by worker category.

The last 2 jobs face outward. Reporting modules calculate the directive's indicators and assemble the annual report, while range modules turn market data into salary bands: Trusaic's Salary Range Finder guides salary decisions to prevent new gaps, and Pave prices jobs against real-time benchmarks from more than 9,000 participating companies. Figures also drafts documentation explaining individual pay decisions to employees and their representatives.

Sources: [4][16][26][27][28][29][30][31][32]

What AI adds to pay transparency tools, and where it stops

The AI in these tools mostly suggests, drafts and flags, and people decide. Syndio states that its Syndi AI does not make pay decisions, beqom describes humans in the loop for critical oversight, and Paygaps.de counts AI job ratings only after HR has approved them.

Matching is the most established use. Payscale uses large language models to suggest the 5 most relevant job matches from new salary surveys, and CompLens says its AI maps payroll imports with 92 to 98 percent accuracy depending on the field, a vendor figure, not an independent test.

The newer layer checks decisions as they happen. Syndio's Syndi AI, trained on more than 10 million pay records according to the vendor, reviews offers, promotions, merit increases and transfers against policy, internal equity and market data before approval and shows its reasoning. The Bias-Checker in beqom highlights differences in how raises were attributed, the Pave Agent builds job architectures and prices new jobs, and Compa keeps its Analyst and Partner agents in a separately priced tier.

Some advertised features are not live yet: Trusaic lists Trusaic AI as coming soon, and Syndio marks its Predict tier the same way. AI that shapes individual pay can also fall under the EU AI Act, whose Annex III lists AI systems used to make decisions affecting the terms of work-related relationships as high-risk. Under the Digital Omnibus agreement of May 2026, those duties apply to stand-alone systems from December 2, 2027, as our AI Act guide for HR explains.

Sources: [33][29][28][34][35][32][36][31][37][38]

The vendors: US data platforms and European directive specialists

Our directory lists 11 tools in its compensation and pay transparency category. The United States is the largest home base with 5; most of the others are headquartered in Switzerland, France and Germany, and the list includes 1 from India.

Among the US platforms, Payscale sells 3 packages without published prices, Compa lists annual tiers from $15,000 for research data and $35,000 for live market data, and Pave offers a free Market Data Lite tier with paid tiers on request. Compa hosts all its data on AWS in the United States.

The European tools start from the directive or from job evaluation, and more of them publish prices. CompLens charges €1,690 a year for up to 249 employees with a 14-day trial, Paygaps.de starts at €2,490 a year for up to 250 employees and gradar runs from €3,000 to €10,000 a year with a free trial, while Figures quotes by headcount and modules. All prices are as of September 2026.

Across the category, 5 tools can host data in the EU and 5 publish no prices at all. The compensation and pay transparency category shows each tool's strong markets, hosting and pricing model.

Sources: [39][40][36][41][32][35][42][43][44][45][46][47]

What to check before buying pay transparency software

Start with your own footprint. List the countries where you employ people and when each one's rules apply, then ask the vendor to show how it handles national differences such as Malta's 8-day answer period or Lithuania's reporting through SoDRA.

Next, test the method. The directive accepts only gaps justified by objective, gender-neutral criteria, so ask how the tool forms comparison groups, which factors may explain a gap and whether you can see the model behind an adjusted figure. Check who approves AI suggestions and whether approvals are logged, since the joint pay assessment happens together with workers' representatives.

Then follow the salary data. Compa hosts only in the US, and Paygaps.de keeps platform data in Frankfurt but says its AI model calls, mainly to Anthropic, may be processed outside the EU under standard contractual clauses. Finally, price the setup for your headcount: published European licenses start in the low thousands of euros a year, while Payscale and Figures quote individually.

Sources: [14][8][4][5][41][48][35][40][44]