By Brittany Dian-Hansell
Blog Overview: Finland has released a draft proposal to implement the European Union (EU) Pay Transparency Directive. Employers with employees in Finland should be prepared for the legislation to take effect in May of 2026 and begin reporting pay data following the timeline laid out in the Directive.
Finland is progressing toward implementation of the European Union (EU) Pay Transparency Directive, with plans for national legislation expected to take effect on May 18, 2026. A draft government proposal was issued for review on December 22, 2025, with comments by interested parties due by February 9, 2026. The proposed law largely mirrors the Directive’s minimum requirements, but highlights the country’s commitment to pay transparency by extending several transparency obligations more broadly across employers. If passed, this law would amend Section 6 of Finland’s Act on Equality Between Women and Men.
Major Requirements of Finland’s Draft Proposal
Overall, Finland’s proposal aligns closely with the EU Directive’s minimum standards. Major requirements include:
- Salary transparency: Employers must disclose starting salary or salary ranges during the hiring process and may not ask candidates about salary history.
- Right to pay information: Employees can request their individual pay and average pay by gender for comparable roles, with employers required to respond within two months.
- Pay gap reporting: Employers with 100 or more employees must report gender pay gaps, including average and median pay gaps, pay quartile distributions, and variable pay differences with phased reporting deadlines based on workforce size. Employers must retain pay gap data for a period of at least four years.
- Formal documentation & disclosure: Employers with 50 or more employees must formally document and communicate pay progression and promotion criteria using objective, gender-neutral standards.
- Equal value assessment: New guidance clarifies how “work of equal value” should be assessed using objective, gender-neutral criteria such as qualifications, responsibility, workload, and working conditions.
Finland plans a hybrid compliance mode by leveraging the Incomes Register Unit of Tax Administration to collect data and its national statistics office, Statistics Finland, to conduct some analysis. Employers will be responsible for other portions of the analysis, reporting, disclosures, and joint pay assessments where unjustified pay gaps of 5% or more are identified. Enforcement will be significant, with administrative fines ranging from €5,000 to €80,000 for noncompliance, separate from any potential claims for back pay or damages.
Timeline of Reporting Matches EU Directive
The EU Pay Transparency Directive's reporting requirements are phased based on company size to allow small and mid-sized organizations more time to comply with the requirements of the directive. Employers with 250 or more employees will be the first to comply, with their initial data reporting year set for 2026 and their first report due by June 2027 on an annual basis going forward. Companies with 150–249 employees follow the same initial timeline, with a 2026 data reporting year and a June 2027 deadline, but will report on a triennial cycle rather than annually. Smaller organizations with 100–149 employees have more time to prepare, as their first data reporting year is not until 2030, with the initial report due by June 2031, and subsequently on a triennial basis.
It is clear that the operational impact of this draft law on employers will be substantial. With the goal of implementation less than 4 months away, organizations with employees in Finland should focus on reviewing existing job structures and pay setting standards, enhancing pay transparency practices, and establishing internal protocols that will assist them in meeting these compliance obligations going forward.
DCI will continue to monitor developments in Europe as member states work to implement legislation to comply with the EU Pay Transparency Directive and will provide updates as they occur.
