Last updated 2025-08-22
Quick overview
Germany introduced its Remuneration Transparency Act in July 2017 to address pay differences between men and women. The law requires larger employers to report on equality measures and allows employees to request information about pay levels. While sanctions are limited, the framework places strong emphasis on transparency, equal pay, and employee rights.
Reporting requirements
Which companies must report?
Employers with more than 500 employees and who are already obliged to publish a management report under the German Commercial Code must include gender equality and equal pay information.
Employers with more than 200 employees must comply with employee information rights, meaning staff can request details on comparative pay.
What information needs to be reported?
Companies in scope must prepare a gender equality and equal pay report every three years (or every five years if collective agreements apply). The report must include
Measures taken to promote gender equality and equal pay
The effects of these measures
Gender-disaggregated statistics on the number of employees, full-time and part-time
If no measures were taken, the report must explain why.
Employers are encouraged, though not legally required, to perform internal audits to assess their pay structures and address any gaps.
When and where to send the data?
Reports are published as part of the company’s management report within three months of the financial year end. The report is submitted through the German Federal Gazette and attached to the next management report in accordance with section 289 of the German Commercial Code.
Who can see the results?
The published reports are publicly accessible in the German company register. Employees and the public can therefore see what actions companies are taking to address pay equality.
Equal pay laws
The principle of “equal pay for equal work or work of equal value” is firmly established in German law. Employers must not differentiate pay based on gender. Factors such as type of work, training, and working conditions determine comparability.
The General Equal Treatment Act also prohibits discrimination based on gender, age, disability, religion or belief, race/ethnicity, or sexual orientation.
Temporary workers are protected under the Temporary Workers Act, which grants them the right to request information on comparable pay within the host company.
Employee rights
Employees working in companies with more than 200 employees can request information about the median pay of comparable colleagues of the opposite gender, provided at least six comparators exist to ensure data privacy.
Requests can be made every two years. Employers must disclose base pay and up to two additional components (such as bonuses or car allowances). The response must be delivered within three months.
Employees whose pay is lower than that of comparable colleagues can file claims for equal pay in court.
Risks of non-compliance
There are no criminal sanctions or direct fines for non-compliance. However, legal risk arises from employee claims: if employees can prove pay discrimination, companies may be required to adjust remuneration and provide back pay.
Failure to report or respond properly can also create reputational damage and weaken trust among employees, unions, and the public.
What will change by 2026
New EU-wide rules
The EU Pay Transparency Directive requires all member states to implement new legislation by June 2026. It will introduce stricter obligations, including
Pay transparency in job advertisements
Ban on pay confidentiality clauses
Regular pay reporting thresholds starting from 100 employees
Obligation to take corrective action when unjustified gaps exceed 5 percent
How Germany is likely to apply them
Germany does not plan to amend the current Remuneration Transparency Act, as the changes required are too extensive. Instead, a new federal law will be drafted by the end of 2025, replacing the existing act.
Employers can expect broader obligations, lower thresholds, and mandatory audits. This will significantly expand compliance requirements for companies that currently fall outside the 500-employee threshold.
FAQ
Do small companies need to report pay gaps?
No. Only companies with more than 500 employees currently face reporting obligations. However, this threshold will decrease under the EU directive.
What if my company has 250 employees?
You do not need to publish reports, but employees still have information rights if you have more than 200 employees.
Are pay confidentiality clauses enforceable?
Extensive clauses that prohibit employees from discussing pay with colleagues are invalid under case law, even if not explicitly banned in legislation.
Can temporary workers demand information?
Yes. Under the Temporary Workers Act, they can request comparable pay information at the host company.
How often do reports need to be published?
Every three years, or every five years if collective bargaining agreements apply.
Is an internal pay equity audit mandatory?
No. It is encouraged but voluntary.
What is the consequence of not filing a report?
There are no direct sanctions, but reputational risk and employee claims are significant.
What pay information can employees request?
They can request the median pay of colleagues of the opposite gender in comparable positions, including base pay and two extra pay components.
How quickly must employers respond to information requests?
Within three months.
Does the law cover trainees?
Yes. Permanent employees and trainees are included.
Are job advertisements regulated?
They must not discriminate under the General Equal Treatment Act. However, the Pay Transparency Act does not impose additional requirements.
What statistics are required in reports?
The total number of employees, and the number of full-time and part-time employees, broken down by gender.
Where are reports published?
In the German company register, alongside management reports.
Can employees claim back pay if discrimination is found?
Yes. Employees can bring claims and receive equal pay retroactively.
What changes are expected before 2026?
A new national law will replace the current act, lowering thresholds and introducing stricter obligations in line with EU rules.
Helpful resources
Federal Ministry for Family Affairs, Senior Citizens, Women and Youth (BMFSFJ)
German Commercial Code (Handelsgesetzbuch, HGB)
Remuneration Transparency Act (Entgelttransparenzgesetz)
EU Pay Transparency Directive (2023/970)
Contact us
Book a meeting with our country partner for more information of how Sysarb can help your company with Pay Transparency compliance.
