In our ongoing advisory work on Pay Transparency Directive compliance across multiple EU jurisdictions, we see this request as highlighting both the unprecedented administrative complexity that the new legislation brings, and the significant systemic and cultural shifts it demands from Member States.

BusinessEurope’s extension request

On 27 February, Business Europe, Europe’s largest business organisation, sent a letter addressed to Commission President Ursula von der Leyen, requesting the two-year pause. In the letter, BusinessEurope expressed “unwavering support for the principle of equal pay for equal work” while raising serious concerns about “unworkable administrative complexity”. The business organisation argues that the majority of Member States haven't made sufficient progress to meet the deadline – not through lack of will, but because of “the unprecedented complexity of the Pay Transparency Directive and the significant cultural and systemic shifts it demands”.

BusinessEurope is seeking the two-year pause to achieve three objectives: simplify requirements so they're proportionate for SMEs and large enterprises alike; respect national industrial relations and allow better integration with existing systems; and empower social partners to lead implementation in a way that reflects labour market realities.

The proposed simplification measures and implications

Alongside its request for an extension, BusinessEurope has also proposed a targeted set of amendments to the Pay Transparency Directive. These fall into two categories:

Collective bargaining – presumption of compliance

This proposal would establish a “presumption of compliance” for companies adhering to collective agreements that contain gender-neutral job classification systems. Under this approach, companies bound by such agreements would be deemed compliant with key obligations under Articles 4, 6, 7, 9 and 10 of the Pay Transparency Directive, unless proven otherwise. The rationale is that in many Member States, collective agreements already apply objective, gender-neutral criteria to guarantee fairness in pay determination.

BusinessEurope argues this would deliver a “massive administrative burden reduction” while also incentivising collective bargaining and increasing coverage across Europe. It would also mean the burden of proof wouldn't automatically shift to employers where collective agreements apply. Instead, employees should first establish a case suggesting non-compliance.

Other simplification priorities

BusinessEurope says its remaining proposals are intended to make the Pay Transparency Directive operational for all companies, including those that do not adhere to collective agreements.

The proposals include:

• Single source removal: Perhaps most controversially, BusinessEurope wants to delete the “single source” requirement for equal pay comparisons – which comes directly from EU treaties, not the Pay Transparency Directive – limiting assessments to only workers within the same organisation under the employer’s direct control.
• Reporting thresholds: BusinessEurope wants to raise the threshold for reporting obligations to align with the Corporate Sustainability Reporting Directive (1,000 employees), removing smaller companies from scope.
• Equal work and work of equal value: This proposal seeks to make the listed criteria (skills, effort, responsibility and working conditions) optional rather than mandatory and to clarify the wording so the provision is applied in line with national law and practice, without creating new co decision duties for workers’ representatives.
• Pay progression: BusinessEurope argues that employers with fewer than 50 employees should be automatically exempt from the pay progression obligation, rather than leaving this exemption to the discretion of Member States. It maintains that making the exemption optional could lead to inconsistent implementation across the EU and impose unnecessary burdens on small enterprises.
• Right to information request limits: This proposal would restrict employees to one pay information request per twelve-month period, addressing concerns about disproportionate use of the right to information.
• Data protection: Under the proposal, a minimum number of comparative employees would be required before pay data could be disclosed, preventing identification of individual workers and workers representatives would be removed from having access to such pay data or being able to advise workers about a possible claim under the Pay Transparency Directive.
• Compensation limits: BusinessEurope proposes removing liability for “lost opportunities” linked to pension entitlements arising after employment ends, arguing this goes beyond employer responsibility.

Legal and political feasibility: our assessment

Realistically, it’s unlikely that the timetable will pause. The Pay Transparency Directive has already reached legal finality under EU legislative procedures and the European Commission reiterated in December 2025 that it expects all Member States to meet the transposition deadline. Introducing a formal pause would require an amendment process, which is highly improbable within the current political cycle.

The Pay Transparency Directive was also finalised in 2023 after several years of negotiation, and reopening the process now would require significant political will, which appears absent. There is also, in our view, no political support for raising the reporting thresholds to 1,000 employees. During negotiations, the EU expressly lowered thresholds to 100 employees during negotiation and reversing that decision would face fierce opposition from stakeholder groups.

Instead, we expect staggered, imperfect national transposition rather than a formal pause.

That said, some proposals are more viable than others.

• The collective bargaining presumption is the most plausible. In countries with strong sectoral bargaining, the proposal reduces bureaucratic duplication while maintaining employees' rights to challenge pay inequality. As a national implementation approach, it's credible – though whether collective bargaining categorisation truly addresses "equal value" remains legally uncertain.
• Some incremental simplifications are sensible. Limiting how often employees can request pay information, introducing minimum comparison group sizes and allowing references to collective agreements rather than duplicating information are amendments that national authorities could implement without reopening the Pay Transparency Directive. With most EU member states still to produce a draft, it’s possible that legislators might draw some inspiration from these suggestions.

The "single source" objection highlights real structural tensions. As mentioned above, this requirement derives from EU treaty rights and can't simply be negotiated away. We expect this to become a major litigation battleground once the rules are operational, further complexifying equal pay claims that are already complicated enough.

What do BusinessEurope’s proposals mean for employers?

As the Pay Transparency Directive moves from the page to the workplace, its true impact is becoming clear. It’s a far reaching and disruptive measure designed to tackle an equally substantial challenge - closing the pay gap. Given the Pay Transparency Directive’s far-reaching legal implications, resistance from business associations was predictable and reflects the ongoing challenges employers across sectors are facing.

A two-year pause is, in our view, extremely unlikely. What is more likely is delayed, staggered, unclear and imperfect implementation across Member States.

Our view is that employers should continue preparing for the 7 June 2026 deadline while monitoring national transposition closely – and building flexibility into their compliance programmes to adapt as the picture becomes clearer.

We're tracking developments across the EU and will keep you updated as the situation evolves.

BusinessEurope’s proposals are available here.