The Czech law to transpose the EU Pay Transparency Directive is set to take effect on 1 January 2027. Most new obligations, however, will take effect from 1 January 2028, meaning Czechia is expected to implement some elements of the Directive significantly later than required.

While the draft may be refined before finalisation, it already signals a broader regulatory shift. Czechia is not merely implementing the Directive but reinterpreting it as a framework for organisational pay governance. In this sense, it goes beyond just being a reporting regime. Employers operating in Czechia will need to prepare for several requirements that are more onerous than the Directive baseline. These include a universal mandatory remuneration system, a separate documented benefits system and an expanded enforcement role for the Ombudsman.

In this article, we first explore a quick summary of the key provisions in the draft legislation, before examining them in more detail.

The draft legislation: At a glance

Before delving into the detail, here is an overview of what employers operating in Czechia need to know regarding the new draft legislation to transpose the Directive:

• Employers must not underestimate the obligations implemented from 1 January 2027. In particular, employers are required under the draft to create a formal remuneration system. This goes beyond the Directive’s requirements and presents a significant additional compliance burden, especially for SMEs. The right to pre-employment transparency and restrictions on salary history questions will also be implemented with effect from 1 January 2027.
• Most provisions will take effect from 1 January 2028. This includes, for example, the joint pay assessment mechanism, pay gap reporting for employers with 150+ employees and shifting of the burden of proof. These provisions are therefore set to be implemented significantly later than the Directive requires. Nevertheless, other key obligations will be implemented earlier than this that employers need to take note of.
• Employers providing non-pay monetary benefits must create a separate documented system. The system should use objective, non-discriminatory criteria. This is an entirely new obligation not found in the Directive and will be implemented with effect from 1 January 2027. This obligation is separate from the requirement that employers establish a remuneration system.
• Pre-employment pay disclosure is narrower than the Directive requires. Employers need only disclose the "minimum" wage or salary, not the full initial pay level or range.
• The Ombudsman (Public Defender of Rights) will have an expanded enforcement role. This includes the power to represent employees in court proceedings.
• Joint pay assessments (known as “remuneration assessments”) involve a complex new process. This includes a 30-day waiting period for workers to organise representation if none exists. The joint pay assessment mechanism will apply from 1 January 2028.
• Fines for major breaches are capped at CZK 1,000,000 (approximately EUR 41,000 or GBP 35,000).

Transposition timeline: a late but phased approach

Czechia will miss the 7 June 2026 transposition deadline. The draft adopts a phased implementation approach, under which the bulk of new provisions take effect from 1 January 2028, and some measures apply from 1 January 2027.

The larger pay gap reporting threshold (capturing employers with 150+ employees) will not come into force until 1 January 2028 (with first reports due by 30 April that year). This is later than the Directive's 7 June 2027 timetable.

The lower pay gap reporting threshold (capturing employers with 100-149 employees) will not come into force until 1 January 2031 (with first reports due by 30 April that year). This is slightly earlier than the Directive's 7 June 2031 timetable.

Employers with 250+ employees will be required to report annually and employers with 100-249 employees will be required to report every three years. These reporting intervals are in line with the Directive.

This late transposition and delayed implementation of obligations follow a pattern seen in several other EU Member States, such as France, Ireland and the Netherlands.

Pre‑employment obligations: a narrower approach to pay disclosure?

The Directive requires employers to inform job applicants of the “initial pay level or its range,” determined using objective, gender‑neutral criteria. The Czech draft adopts a narrower formulation, obliging employers to disclose only the minimum wage or salary and all other monetary benefits and benefits of monetary value. This falls short of the initial pay level or pay range envisaged by the Directive. At the same time, it goes further than the Directive by also requiring employers to provide information about other monetary benefits before employment contract negotiations begin.

This approach may amount to under‑implementation. By requiring disclosure only of a floor figure rather than a range, the draft gives employers greater flexibility. However, it also introduces infringement risk if the European Commission considers the measure insufficient to meet the Directive’s transparency obligations.

The draft also transposes the Directive’s salary‑history ban, prohibiting employers from relying on an applicant’s current or previous remuneration.

Mandatory remuneration systems: a major new compliance requirement

One of the most significant aspects of the Czech draft is the requirement for all employers to establish a formal, documented remuneration system, set out in an internal regulation or collective agreement. This system must include a classification of roles into groups based on the value of work. This goes well beyond the Directive, which requires pay criteria to be accessible but does not mandate a formal documented system for every employer.

The Czech job evaluation criteria also differ from the Directive. The Directive specifies skills, effort, responsibility and working conditions. By contrast, the Czech draft uses complexity, responsibility and strenuousness. This reflects existing Czech labour law tradition but potentially creates alignment issues.

In addition, employers who provide non-pay monetary benefits must create a separate documented system for those benefits, with objective and non-discriminatory criteria. This has no equivalent in the Directive and creates an additional compliance layer. However, this reflects the Czech legislature’s attempt to address the very broad definition of the term “pay” used in the Directive, compared to how this term has traditionally been understood in Czech labour law.

Individual pay information rights: some Czech additions

Workers may request information on their own pay and the average pay in their work group, broken down by gender. The Czech draft adds procedural detail that goes beyond the Directive: workers must submit requests in writing.

The employer may restrict the use of this information to equal pay purposes, but only if it makes a written determination to that effect. This procedural requirement is not found in the Directive.

Where disclosure would reveal an individual employee's pay, the Czech draft channels the request through the Ombudsman rather than through workers' representatives or the labour inspectorate.

Joint pay assessments: a more elaborate process

Where the employer identifies a pay gap of 5% or more and cannot justify it by objective, gender-neutral criteria, or fails to rectify it within six months, employers must carry out a "remuneration assessment". The Czech draft imposes a more elaborate process than the Directive envisages.

Employers must discuss the assessment with trade unions and works councils. If no employee representatives exist, the employer must publish the information in a manner customary and accessible to all employees. They must allow a 30-day period for workers to organise. The employer may only proceed unilaterally if no trade union or works council is formed after this waiting period.

The assessment itself must be comprehensive, covering:

• the proportion of men and women in each work group;
• average pay levels;
• identified disparities and their causes;
• the proportion of parents who experience an increase in remuneration after maternity/paternity/parental leave;
• proposed remedial measures with timescales; and
• an evaluation of any previous measures.

Employers must publish the completed assessment in a manner accessible to all employees and provide it to trade unions, the works council, the Ministry, and (on request) the labour inspectorate and the Ombudsman.

The Directive itself imposes no deadline for completing the assessment. The Czech draft, however, requires completion within two months of the expiry of the six-month remedial period.

Enforcement: an empowered Ombudsman and modest penalties

The Czech draft assigns a significantly expanded role to the Ombudsman (Public Defender of Rights). Beyond collecting data and publishing reports, the Ombudsman will evaluate pay information, advise employees, issue opinions on employer remedial measures, and – most notably – represent employees in court proceedings. This means that employers may face a more active and potentially adversarial equality body.

The draft expands the reversed burden of proof beyond the Directive’s requirements. Under the draft, if an employer breaches its transparency obligations, it must prove that it has not violated the principle of equal treatment, unless it can show the breach was "manifestly unintentional or minor". Under the Directive, the exemption applies for breaches which are “manifestly unintentional and minor” (emphasis added).

On the sanctions side, fines are capped at:

• CZK 1,000,000 (approximately EUR 41,000 or GBP 35,000) for major breaches such as failure to create a remuneration system or violations of the joint assessment process; and
• Up to CZK 400,000 (approximately EUR 16,000 or GBP 14,000) for lesser breaches such as restricting pay information.

Whether these penalty levels are "effective, proportionate and dissuasive" – as the Directive requires – is open to question, particularly for larger employers. However, the amount of the fines falls within the existing range of fines for violations of labour law obligations.

The Czech draft also provides for financial compensation for non-pecuniary damage arising from pay discrimination.

Pay secrecy ban and other provisions

The draft includes a broad prohibition on employers restricting employees from sharing information about their pay, salary or other monetary benefits. This reflects a faithful transposition of Article 7(5) of the Directive.

One notable gap in the published draft is public procurement compliance. The Directive requires Member States to ensure that economic operators in public contracts comply with equal pay obligations and allows exclusion of operators with an unjustified 5% or greater pay gap. This does not appear to be addressed in the current Czech draft text.

Takeaway for employers

Even though many provisions will not apply until 1 January 2028, the requirement that employers implement a reward system by 1 January 2027 will be a significant undertaking. It will require considerable groundwork for employers that do not already have formal pay structures in place.

The breadth and depth of the Czech draft means that employers should begin preparation now, if they have not already. Employers should also begin to consider how they will collect, structure and report the data needed for the new pay gap reporting obligations. Furthermore, they should review their recruitment processes to ensure compliance with the pre-employment disclosure and salary history ban provisions. Employers should monitor updates, as the Ministry will determine by decree the content of the report on the pay gap and the method of calculating the gender pay gap.

Multinational employers should assess the Czech draft alongside their broader EU Pay Transparency Directive compliance strategies, noting the areas where the Czech approach is more onerous than the Directive baseline – particularly the universal remuneration system requirement, the benefits system obligation, and the expanded Ombudsman role. They should equally assess areas where it is potentially more favourable, such as the centralised pay gap reporting model and the narrower pre-employment pay disclosure requirement.

We will continue to monitor developments in the transposition of the Pay Transparency Directive across all Member States and provide updates as the Czech legislative process progresses.

This post is co-authored with Ius Laboris and is published here with their permission.