The draft makes national collective bargaining agreements the primary reference point for determining “work of equal value” - an approach that may broaden comparator pools, increase equal pay exposure, and shift judicial focus away from methodology towards the pay gaps themselves. The draft was first published on 3 February and then updated on 5 February, with several important changes. While further changes may still be made before it is finalised, employers should be considering the implications now.
Who does the draft apply to?
The draft applies to all employment contracts, whether fixed-term or indefinite, including part-time and managerial positions. Apprenticeship contracts, domestic work contracts, and intermittent work contracts are excluded. Notably, temporary employees, who were included in the original draft, were removed from the amended version published on 5 February.
How is pay defined?
Pay is defined broadly as basic salary or wage and all sums and values paid by the employer, directly or indirectly, including in kind, as well as supplementary or variable components. Pay level means gross annual pay and the corresponding gross hourly pay, excluding non-structural individual remuneration elements, such as pay components granted on a personal, discretionary or temporary basis.
How is work of “equal value” defined?
The draft confirms that national collective bargaining agreements and legislation require pay-setting systems to use objective, gender-neutral criteria to ensure equal pay for the same or equivalent work. Crucially, using a national collective labour agreement agreed by the most representative trade unions creates an assumption that pay equality and transparency rules are being met - though this does not prevent individual claims of pay discrimination.
“Same work” means roles with identical duties, or roles falling within the same pay level and legal category under the relevant national collective agreement. “Work of equal value” means different roles with comparable duties, assessed by reference to the pay classification levels in the applicable national collective agreement, using common, objective and gender-neutral criteria including skills, responsibility and working conditions.
Job classification systems set by law or national collective agreements will be the main reference point for comparing roles. Employers may use their own job classification systems for pay purposes, provided these are objective, gender-neutral and supplement the collective agreement framework. Comparisons can be made across different employers or group companies where pay is governed by the same law, collective agreement or centrally applied group framework. The Ministry of Labour may issue further implementation guidance on this by 31 December 2026.
What are the pre-hire pay transparency requirements?
Candidates must be informed of the initial salary or applicable pay range for the position, based on objective, gender-neutral criteria and the relevant provisions of the applicable collective agreement. This information must be provided in job notices and announcements through which employment opportunities are made known - which marginally gold-plates the Pay Transparency Directive (this does not require the information to be in the advert itself, only that job applicants can get access to it before interview).
The draft implements the pay history ban. Employers may not ask candidates about current or past pay, nor obtain such information through other means, including indirectly through recruiters.
What ongoing pay transparency obligations apply?
Employers must make the criteria for pay, pay levels and pay progression easily accessible. These obligations are normally met through the information provided at the start of employment, particularly where pay and classification are determined by an applicable collective agreement. Employers with fewer than 50 employees are exempt only from the progression criteria transparency requirement - they must still make the criteria for pay and pay levels easily available.
Employees have the right to request information about their individual pay level and average pay levels by gender for categories of employees performing the same work or work of equal value. Employers must respond within two months (this is a looser timeline than the Pay Transparency Directive which says “within a reasonable period of time but…within two months”) and employees or their representatives may seek clarifications. Employers are required to remind employees of this right annually.
Employers may fulfil this obligation by publishing, on their intranet or a restricted area of their website, information on average pay by gender for workers doing the same job or work of equal value.
What are the rules on pay secrecy?
Employees have the right to disclose their own pay to enforce equal treatment, and contractual provisions restricting this are void. Employers may require that information obtained on average pay by gender be used solely for asserting the right to equal pay.
What are the gender pay gap reporting requirements?
Employers with at least 100 employees will be subject to data reporting to a monitoring body for publication. The Minister for Employment and Social Policy is expected to issue decrees setting out how the Ministry collects and processes worker data, which data employers must provide and the technical support or training available to help employers comply.
Employers may publish the required information, for example, on their website, though the draft frames this as optional rather than a hard obligation. Category data must be made available to workers and their representatives and, upon request, to the Labour Inspectorate and equality bodies. Upon request, up to four years' prior information must be provided where available - potentially including everything dating back to 2022, as there is no clause limiting it to the implementation date.
Employers must give reasoned responses to requests for clarifications about reported data, within a reasonable time (not currently defined), and must correct unjustified discrimination.
Larger employers (250+) submit reports annually, while those with 150–249 employees submit every three years (interestingly this was a change from the first draft which required employers with 150+ employees to report annually). From 2031, the threshold will be reduced to employers with 100 or more employees. This is a significant change to Italy’s current gender pay reporting regime, which requires employers with more than 50 employees to produce a report at least once every two years.
Is there flexibility for multinational groups?
Where an employer adopts a group salary policy, the draft allows aggregation of reporting data at national level if this provides a more reliable representation and facilitates centralised compliance management - an important facilitation for multinational groups operating in Italy.
However, this could come at a cost: employers who aggregate data in this way might demonstrate that a single source determines pay, potentially opening the door to group-wide equal pay actions.
When is remedial action required?
Employers subject to reporting must conduct a joint pay assessment with worker representatives if: (i) a difference of at least 5% in average pay in any category is revealed; (ii) the difference is not justified on objective, gender-neutral grounds; and (iii) it is not corrected within six months.
Employers must make results available to workers and their representatives, communicate them to the monitoring body and, upon request, to the Inspectorate and equality body. Necessary measures must then be implemented in collaboration with worker representatives within a reasonable time, including analysing or establishing gender-neutral assessment and classification systems.
What are the enforcement mechanisms?
Workers can bring legal action under the Equal Opportunities Code procedures, which can also be activated by worker representatives, unions and certain associations. Protection against retaliation applies where workers or their representatives exercise equal-pay rights or support others in doing so. Administrative sanctions under existing law apply where discrimination in breach of the decree is established.
Are there any criminal sanctions?
No. The current draft does not impose any criminal sanctions.
What should employers be doing now?
The focus on national collective bargaining agreements as the primary reference point for equal value assessments is significant. This approach may require closer alignment with national structures and could limit reliance on global grading models. It may also make cross-entity comparisons easier where pay is governed by the same collective framework.
While the draft could still change before finalisation, employers should be reviewing their current pay structures, classification systems and data capabilities to assess their readiness for compliance. We will continue to monitor the draft law and any implementing measures adopted and provide updates as developments arise.
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