France to overhaul Gender Equality Index in line with EU Pay Transparency Directive

At a glance

• France will adopt a new seven-indicator index to measure gender pay gaps to align with the Directive.
• Most indicators will be auto-reported annually via the Déclaration Sociale Nominative system. 
• Firms must explain gender pay gaps of greater than 5%.  

In May 2025, the French government began a period of consultation with labour unions and employers' federations on the implementation into national legislation of the EU Pay Transparency Directive (PTD). The new framework is set to be implemented by 7 June 2026. 

Since September 2018, French companies with at least 50 employees have been required to measure pay inequalities between women and men on their payrolls and to publish, annually, an equality index providing information on the gender pay gap, based on four or five criteria depending on the size of the employer.

Key Changes

• The current system will be replaced with a new index which be based on the following seven indicators taken from the PTD:
  • The pay gap between women and men.
  • The pay gap between women and men in relation to variable and complementary components.
  • The median pay gap between women and men.
  • The median pay gap between women and men in relation to variable and complementary components.
  • The proportion of women and men receiving variable and complementary components.
  • The proportion of women and men in each quartile remuneration band.
  • The gender pay gap by category of worker, broken down by ordinary basic wage and by variable and complementary components.
• Six of the seven indicators will be automatically reported via the 'Déclaration Sociale Nominative' system (general pay electronic declaration system). The seventh, which assesses pay gaps by job category, will have to be reported annually by companies with 250+ employees and every three years by those with 50–249 employees.
• France will maintain its existing threshold of 50 employees for reporting obligations, exceeding the PTD's 100-employee minimum. However, a light-touch regime is planned for companies with fewer than 100 employees.
• Companies will be required to justify any unexplained pay gap exceeding 5%. Failure to do so may result in administrative fines.
• Additional obligations will be introduced to comply with the PTD including requirements to disclose salary ranges in job postings and a ban on asking candidates about previous salaries.
• Companies will be forced to inform their employees yearly, at their request, on their individual remuneration.
• The Government plans to ban NDAs regarding remuneration and to disclose the elements taken into account to calculate the pay, promotions and classification.

Timeline

The consultation that started with the social partners in May 2025 marks the beginning of the process to transpose the PTD.  France has until 7 June 2026 to fully transpose the PTD into national law, with the first reports under the new system expected in March 2027.