Pay transparency rules probably postponed in Hungary

EU directive on pay transparency

The Pay Transparency Directive of the EU published in May 2023 was meant to ensure that the same work receives the same compensation regardless of the gender or other demographic characteristics of workers. As such, it is meant to reduce various inequalities as well as the gender pay gap. It is supposed to be implemented by June 7, 2026 across all the member states.

The most important provisions are as follows:

• Stricter gender pay gap reporting: the pay gap should not be more than 5%
• Transparency on salaries and progression pathways within the organization
• Transparency on salary ranges in recruitment

You can read a more detailed overview in our previous article.

Hungarian elections and implementation

In Hungary, the latest general elections were held on April 12, 2026, which resulted in a landslide victory of TISZA party, a new party created in the last 2 years. Currently, a regime change is underway: the old government continued to function as a caretaker government for a few more weeks after the elections, then the new parliament was convened on May 9, and the new government was inaugurated before EOB May 12. Over the next few months, various ministries will be restructured.

New legislation required for the implementation of the Pay Transparency Directive have been being prepared by the Ministry of Human Capacities. While they have been making good progress, much of their work is currently on hold due to the impending reorganization. As a result, experts do not expect new legislation to be introduced by the June 7 deadline. It is to be seen how much of a priority this issue will be for the new government, but at least some delay is expected.

Delays in other EU member states

Hungary is not the only EU member state that expects delays with the implementation of the Pay Transparency Directive. In Estonia, the directive is considered to unduly increase the administrative burdens on businesses, so it seems doubtful if they are implementing any new legislation in this area, even if they have to pay a fine as a result. In Malta, the Malta Employers’ Association has submitted a request to the government to postpone enforcement, especially since no drafts have been published, which would make timely compliance impossible even if a new law was passed by the deadline. In Sweden, even the original draft of the new legislation considered introduction as of January 2027, but recently the government announced it would seek an EU-level postponement.

Pay transparency at your Hungarian business

Even though no new Hungarian regulations are expected to be published regarding pay transparency, the main provisions are known. As a result, you can already start considering updates to personnel-related processes such:

• Hiring: should have inclusive language and transparent salary ranges
• Career planning: salary ranges should be clear for each level in your organization
• Labor contracts: while salaries are currently often protected by NDAs, employees will need to be allowed to discuss and compare salaries at least among themselves
• Reviewing salaries and reducing inequalities: salary inequalities are often not intentional, but results of previous decisions – which should be reevaluated now

Overhauling existing system is always a challenge, but it will be necessary in order to maintain compliance with regulations. Additionally, the implementation of measures put in place to promote transparency and payment equality will increase employee satisfaction, which can easily translate to increased productivity and better employee retainment, reducing costs related to hiring and training new personnel.

Accounting and payroll with Helpers Finance

Helpers Finance offers accountancy, payroll, and HR compliance services to small and medium-sized businesses in Hungary, with ample experience in working with foreign owners. Whether you need help with payroll administration or HR related workflows, you can count on our commitment and expertise.