What happens if there is a pay difference of more than 5 percent?

At five percent, investigation follows, not automatic sanction

A pay gap of five percent or more between men and women in the same job category triggers an obligation to conduct a joint pay evaluation with worker representatives — but not immediately, and not for every employer. The obligation applies only if the difference cannot be objectively justified on the basis of gender-neutral criteria such as skills, effort, responsibility and working conditions, and if the employer has not remedied the difference within six months. Only then does the joint evaluation follow.

This obligation is linked to the reporting requirement: only employers with a hundred or more employees report on pay gaps, and so it is only in this group that a difference of five percent becomes visible and can lead to this follow-up step. Smaller employers fall outside this scope, unless an employee brings a difference to light earlier through an individual information request. For Dutch employers, this does not yet apply as a legal obligation: the bill transposing these rules is with the Second Chamber of Parliament and must still be passed by both Chambers. For the public and semi-public sector, the directive, now that the transposition deadline has passed, can already play a role through directive-compliant interpretation; for private employers, the directive does not have direct effect.

Article 10 of the directive, and the status in the Netherlands

The obligation to conduct a joint pay evaluation in the event of a difference of at least five percent is set out in Article 10(1) of Directive (EU) 2023/970, and is linked to the reporting obligation in Article 9 which applies only to employers with a hundred or more employees. In the Netherlands, this obligation must still be transposed into the Act implementing the directive on pay transparency between men and women, which is currently under consideration by the Second Chamber of Parliament and has not yet been adopted.