Partner | Executive Search
Salary transparency is becoming a key topic in human resource management. With the upcoming implementation of the “Pay Transparency” Directive in 2026, companies will need to align their compensation policies with the new regulations. The Directive aims to strengthen the principle of equal pay for men and women by eliminating both direct and indirect pay discrimination.
While gender pay equity is a crucial aspect of the Directive, the real challenge for employers will be the obligation to disclose and streamline their compensation policies. How can organizations prepare for these upcoming changes? This question is addressed in this article by Anna Jabłońska-Trepka, a labor market expert, author of numerous Total Reward policies, and Partner at Neumann Executive Advisory, as well as Sylwia Fronc, Head of Neumann Executive Advisory and Partner at Neumann Executive.
Pay Gap vs. Transparency in Compensation Systems
In Poland, the gender pay gap is noticeable, but it is not the most challenging issue to address. The primary challenge lies in the lack of transparent salary systems and the internal consistency of base salaries – ensuring comparable pay for the same work or work of equal value. In practice, salary differences for the same position can reach 30-50%. Various factors contribute to these discrepancies, such as long tenure, labor market dynamics, mergers and acquisitions, and restructuring. The Directive will make these issues subject to public scrutiny rather than internal company matters.
As long as compensation policies and practices remain undisclosed, and employees do not have direct access to them, organizations can manage them at their discretion. However, once transparency regulations are implemented, this will no longer be possible.
How to Determine Job Value?
To manage compensation effectively, it is essential to accurately determine the value of a job. Since work is performed within specific roles, a critical step is defining a clear job hierarchy. The most reliable tool for structuring positions is job evaluation, which assesses the importance and significance of roles within the organizational structure. Contrary to common belief, this process is neither lengthy nor burdensome. On the contrary, it is an excellent tool for analyzing job models, structures, responsibilities, and decision-making authority.
During job evaluation, businesses and HR departments often identify opportunities to optimize organizational structure and responsibilities. The goal is to maximize business efficiency and increase the return on investment in salaries by strategically aligning roles and duties with key organizational priorities. The Directive provides suggested criteria for measuring job value but allows flexibility in defining individual company approaches. The outcome of job evaluation will be a structured job hierarchy, followed by a salary grading system.
Another critical aspect is salary bands, which often fluctuate within a range of +/- 15-20% for specific job categories. While this approach does not fully align with the Directive’s requirements, historical labor market dynamics and compensation system evolution explain its prevalence. Salary negotiation practices, labor cost management flexibility, and the need for competitive salaries have contributed to the persistence of this model in many organizations.
Performance Management – The Key to Effective Compensation
Anna Jabłońska-Trepka highlights that a crucial aspect of the Directive is the increased use of Performance Management tools by employers. Performance-based pay is a variable component tied to achieving specific employee performance outcomes. Based on her 25+ years of experience, Anna observes that Management by Objectives (MBO) systems and incentive programs are often underutilized. Proper optimization of these tools could significantly enhance return on investment, leading to better business results and higher employee engagement.
Defining Compensation Policies: A Strategic Approach
The fundamental question for organizations is: “What business results will fund employee salaries?” The upcoming regulatory changes compel companies to revisit key salary policy questions: What do we pay for, how much do we pay, and how do we structure salaries? What competitive advantage do we want to offer employees, and what performance results should compensation reflect?
Salary transparency should be viewed not just as regulatory compliance but as an opportunity to enhance organizational efficiency and attract top talent.
What Will the Directive Change for Businesses?
The new regulations will require employers to:
- Clearly define compensation principles,
- Disclose salary information at the recruitment stage,
- Provide employees with access to salary data,
- Monitor and report pay disparities.
Anna Jabłońska-Trepka emphasizes that the Directive is already prompting many companies to review and refine their compensation structures, clarify policies, and communicate them transparently. Discussions surrounding the Directive are widespread in social and professional media, meaning that employees will soon expect full compliance. Current labor market research indicates that candidates are increasingly reluctant to apply for job postings without disclosed salary ranges.
One potential benefit of transparency is a reduced pressure for salary increases. If companies are required to communicate pay structures openly, the availability of information will enable a more flexible approach to salary competitiveness. In the long term, this may contribute to labor market stabilization and greater predictability in salary policies.
The Business Perspective on Pay Transparency
According to Sylwia Fronc, Head of Advisory and Partner at Neumann Executive:
The implementation of the Directive will not resolve all compensation challenges, but it will certainly enforce greater order in salary structures. Companies that proactively establish robust compensation governance, rather than waiting for regulatory enforcement, will have a competitive advantage in attracting and retaining top talent.
The Bottom Line
The implementation of “Pay Transparency” principles is not just a legal requirement but also an opportunity to strengthen an organization’s market position and enhance its attractiveness as an employer. For companies that act now to improve salary transparency, this can become a crucial competitive edge in the future.
About the Authors
Sylwia Fronc is a Executive Search Consultant and Head of Advisory at Neumann Executive, bringing her extensive industry experience in the Private Equity, Venture Capital, Finance, Fintech, Green Energy and IT sectors. Sylwia has over 20 years of extensive business experience, with a focus on executive search, leadership assessment, talent management and career advisory, as well as designing and delivering personal development and outplacement programs.
Anna Jablońska-Trepka is a Partner at Neumann Executive Advisory. She specializes in salary adjustments and performance management, advising executives and boards. Anna has consulted for over 100 enterprises across industries like production, energy, FMCG, pharmacy, retail, and finance, including state-owned corporations. At Neumann Executive, she designs remuneration policies based on job evaluation and responsibility analysis, ensuring cost-efficient and effective pay structures.
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