By Loi Tan
BLOG OVERVIEW: On February 26, 2026, Denmark's Ministry of Employment published a draft bill to transpose the EU Pay Transparency Directive (2023/970) into Danish law through amendments to the Equal Pay Act, with the law expected to take effect on January 1, 2027. The draft bill introduces pay range disclosure requirements at recruitment, a salary history ban, expanded gender pay gap reporting obligations using Denmark's DISCO-code wage-statistics system, and a new oversight body called the Danish Labour Market Institute for Equal Pay.
On February 26, 2026, Denmark’s Ministry of Employment formally published a draft bill for public consultation. This bill largely mirrors the Directive’s pay transparency requirements and enforcement of equal pay while adapting them to the Danish labor market model, which relies heavily on collective bargaining and its wage-statistics infrastructure. The proposed draft introduces comprehensive amendments to the Danish Equal Pay Act while maintaining existing wage reporting systems and the wage-setting model widely practiced in the country. The law is expected to go into effect on January 1, 2027, shortly after the Directive’s June 7, 2026 transposition deadline.
Key Proposals
Requiring Pay Transparency from Recruitment to Employment
At the recruitment stage, employers would be required to disclose starting pay or pay ranges to ensure transparent salary negotiations and are prohibited from asking salary history questions. Employees will be able to request detailed salary information about their individual salary and average salary levels by gender within their own worker category and gain access to the criteria used for determining their pay, pay levels, or pay increases.
Employers would also be mandated to inform employees, including those with disabilities, of their right to request pay information annually as well as how this information can be accessed . Employees would be able to request clarification on these reports and expect employer response within two months. It is important that these disclosures should go to employee representatives or the Danish Institute of Equal Pay, not directly to the requesting employee, if it would result in direct or indirect disclosure of an identifiable employee’s salary.
Expanding Pay Reports that Reflect the Same Work or Work of Equal Value
The bill would expand the existing Danish wage-statistics reporting system by requiring additional indicators to meet the obligations of the Directive. These include the mean and median gender pay gaps, where pay would include supplemental and variable pay, as well as the pay distributions by gender, and gender pay gaps calculated across categories of workers performing the same work or work of equal value. These worker categories, which will be determined by the employer, and where relevant, in cooperation with employee representatives, must be based on objective, gender-neutral criteria.
Gender-segregated wage statistics are currently generated for employers by Statistics Denmark or employers’ organizations[1] using payroll data reported by employers based on job classifications following the six-digit DISCO codes[2]. The bill preserves this system but would require employers to prepare their own wage statements where the official statistics do not reflect the new categories of employees within the employer.
Legislative comments on the bill note that the DISCO codes, which reflect job-function groupings, will often be insufficient to meet the requirements of the Directive for analyzing pay gaps among workers performing the same work or work of equal value. Because of this, employers would often need to supplement the official wage statistics with their own categories of workers performing the same work or work of equal value based on non-discriminatory and gender-neutral criteria. These criteria should consider skills, effort, responsibility and working conditions, and any other factors relevant to the specific job, including soft skills.
Employers would be given the responsibility to ensure the accuracy of their wage statements in consultation with employee representatives before final submission to the oversight body (Section 5e(2)) and ensuring that they meet the requirements of the Directive overall.
Preserving the Role of Collective Agreements
The remarks to the bill also highlight the importance the government places on the Danish labor market model, where wage-setting is conducted with social partners through collective bargaining. As in the existing Equal Pay Act, these agreements would take precedence over the law’s requirements (amended Section 1(5)) to the extent that collective agreements outline rights and duties equivalent to the proposed law’s transparency and reporting obligations.
The entire public sector and a large part of the private sector (including employer associations, trade unions, and the financial sector) would be covered by collective agreement provisions in regard to pay reporting and therefore would have established institutions or organizations[3] prepare their wage reports.
Changing the Coverage and Frequency of Reporting Obligations
The bill prescribes the frequency of reporting based on employer size. Employers with 250 or more employees would need to report annually, while those with 150 to 249 employees would need to report every three years beginning in 2028. Those with 100 to 149 employees would be required to report every three years beginning in 2031. Although the Directive does not require pay reporting for employers with fewer than 100 employees, Danish law has long required certain employers to produce gender-based wage statistics. Under the existing Equal Pay Act, employers with at least 35 employees must report gender pay gaps for DISCO-based job groups having at least 10 men and 10 women. The draft bill would modify this national requirement to apply to employers with 50 to 99 employees when there are at least 8 employees of each gender within the same DISCO-based job group. Statistics for these employers do not necessarily reflect categories of workers performing the same work or work of equal value.
While agriculture, forestry, and fishing sectors are currently exempt from reporting obligations, the bill—according to accompanying remarks—would remove that exemption, meaning employers in those sectors with at least 100 employees would be subject to the new reporting obligations. Employers would also be required to independently prepare wage statements for employees who are not paid according to time worked[4], as Statistics Denmark presently does not cover these workers (Section 5b(3)).
Shifting Burden of Proof to Employers
Whereas employees currently need to demonstrate the circumstances that presumably gave rise to pay discrimination, the proposed bill would provide that a presumption of discrimination may arise where employers fail to comply with transparency obligations, unless such failure is proven to be unintentional and of minor importance.
Addressing Unjustified Wage Gaps Above Threshold
A joint salary assessment in cooperation with employee representatives would be required of employers with at least 100 employees who have failed to address unjustified average pay gaps of 5% or more within six months of statement submission to the designated authority (Section 5f(2)).
Failure to comply with pay transparency and reporting obligations or to remedy an unjustified pay gap may lead to fines under the Equal Pay Act, with the possibility of higher penalties under other legislation. Employers may also incur corporate criminal liability for such violations under the rules on legal-person liability in Chapter 5 of the Danish Criminal Code (as referenced in Section 6b of the Equal Pay Act). In addition, employees whose rights are violated through pay discrimination may be entitled to compensation (under Section 2(2)).
Consistent with existing law, no explicit fine amounts or sanctions were outlined in the bill, but in current practice, penalties may be determined on a case-by-case basis or through enforcement of collective agreements. It remains to be seen if the final version of the bill will expand current law provisions to meet the Directive’s mandate to provide for “effective, proportionate, and dissuasive” penalties for breaches of pay transparency rules.
Creating a Centralized Oversight Body
A dedicated body called the Danish Labour Market Institute for Equal Pay would be established with oversight functions. It would be considered an equal treatment authority tasked with assisting victims of pay discrimination and conducting independent investigations. As a monitoring and supervisory body, the Institute would receive pay reports and joint assessment reports, analyze causes of gender pay gaps, and publish aggregate pay data, among other functions.
Timelines and Deadlines
Public consultation of the proposed bill will run through March 27, 2026. The amended Act is expected to take effect approximately six months after June 7, 2026, the Directive’s implementation deadline. The proposed reporting timeline also differs from the Directive’s June 7 deadline. Consistent with current Danish practice, Statistics Denmark or an employers’ organization would send wage statements to employers by September 1 each year, allowing these entities adequate opportunity to ensure the quality of payroll data. The proposed bill requires employers to then submit their wage statements to the Danish Labour Market Institute for Equal Pay within one month of receiving the final data or from the completion of the companies’ self-prepared wage statements, which are due no later than December 31 of the reporting year.
Reports would cover the previous calendar year. For enterprises with at least 150 employees, the first reporting cycle would cover 2027 pay data, with wage statements issued by September 1, 2028. Reporting obligations for employers with 100 to 149 employees would begin later, with the first reporting cycle expected in 2031.
Employers with 50 to 99 employees would continue to be subject to Denmark’s wage-statistics requirement. In those cases, gender-segregated wage statistics would continue to be generated through the Statistics Denmark reporting system rather than through the Directive’s full pay-reporting regime.
What This Means for Employers
The more than 12-month delay in the submission of initial reports should provide ample time for employers to review their recruitment process and pay structures to align with requirements of the Directive as well as address any unjustified gender pay gaps appearing in their pay data. Significant adjustments are expected for companies that operate in previously report-exempt industries, those with a mix of workers who are not paid according to hours worked (e.g., piecework, commissioned), and those with a combination of employees who fall under and outside collective agreements.
DCI will continue to monitor the progress of this proposed law, as well as the transposition of the EU Pay Transparency Directive across all EU member states. Join our mailing list to receive future editions of the EU Pay Transparency Navigator, our monthly newsletter covering these developments.
[1] The legislative comments mention the Dansk Arbejdsgiverforening (DA) or the Confederation of Danish Employers and the Fagbevægelsens Hovedorganisation (FH) or the Danish Trade Union Confederation.
[2] DISCO stands for Danish International Standard Classification of Occupations, Denmark’s national version of the international occupation classification maintained by the International Labour Organization.
[3] KMD (Kommunedata), Silkeborg Data, and the Danish State Wage System for the public sector; the employer association (DA) and trade union (FH) for the private sector.
[4] For instance, workers paid based on completion of specified tasks or units of outputs.