The European Union’s Pay Transparency Directive, which member states were supposed to implement by June 2026, remains unenacted in Germany — and a national law is not expected before the first quarter of 2027. Yet the core obligations are already clear, and businesses will need to prepare for sweeping changes taking effect in 2028.
Among the most consequential shifts: employers will no longer be allowed to ask job candidates about their previous salary during interviews. The prohibition is designed to prevent low prior earnings from permanently dragging down an applicant’s negotiating position. Non-disclosure clauses that bar employees from discussing their own compensation will also become unenforceable.
Workers will gain a new right to access the median pay for comparable positions within their organisation. Larger companies, in addition, will face regular reporting duties on their overall pay structures.
Court rulings add momentum while legislation lags
Germany missed the transposition deadline — interpreted as either early or late June 2026 — without a single piece of implementing legislation. The German Gender-Pay-Gap stood at 16 percent in 2025, underpinning the EU initiative.
However, case law has not waited for the legislature. Germany’s Federal Labour Court (BAG) ruled on 19 February 2026 (case reference 8 AZR 83/25) that the current right to information about pay remains limited to the individual employer and to the preceding calendar year. That differs from the EU directive, which permits cross-company comparisons when there is a single source of pay data.
National courts are obliged to interpret existing domestic rules in line with the directive — a principle that may lead them to set aside conflicting provisions in individual cases. In one example, the Bochum Regional Court granted an equal-pay claim to a managing director based on a paired comparison. The right to pay information was also strengthened for employee-like persons.
Parallel changes arrive in July 2026
While the pay-transparency law is still pending, other labour and social reforms will take effect on schedule this July.
- Care-sector minimum wages rise: unskilled care workers will earn €16.52 per hour, skilled caregivers €21.03.
- Pensions increase by 4.24 percent, bringing the new pension value to €42.52.
- Workplace digitalisation advances: Microsoft is rolling out a Teams feature that automatically detects the employee’s location via company Wi-Fi.
On the tax side, the deadline for filing the 2025 income-tax return remains relevant: individuals filing themselves must submit by 31 July 2026; those using a tax adviser have until 2 March 2027.
