Portugal must incorporate the European Pay Transparency Directive into its national legislation by June 7, a measure aimed at promoting greater transparency and equity in compensation. To assess the impact of this change, CATÓLICA-LISBON, in partnership with Mercer Portugal, brought together experts at the Cardeal de Medeiros Auditorium on April 28 to discuss the key impacts, challenges, and opportunities associated with the new legislation.
The directive introduces structural changes in how organizations communicate and manage pay, requiring, among other measures, the disclosure of salary ranges in recruitment processes and strengthened reporting obligations on pay disparities. Its objective is to increase transparency and reduce inequalities, particularly those based on gender.
In the opening session, Filipe Santos, Dean of CATÓLICA-LISBON, emphasized the directive’s significant impact on organizational culture. “When there is transparency, when there is accountability, when there is a need to explain why we do what we do and how we do it, it requires a level of honesty that increases trust and improves organizational culture,” he stated.
From a consulting perspective, João Pacheco highlighted the directive’s key changes and stressed that preparation requires a structured approach, based on dimensions such as job architecture, pay equity, compensation policies, and effective communication. He argued that “pay transparency is not a threat to strategy; it is an opportunity to make it visible.”
Américo Oliveira Fragoso introduced a legal perspective, noting that Portugal already benefits from a relevant legislative framework, particularly Law No. 60/2018. However, he warned of the complexity involved in aligning national and European frameworks, as well as the risks associated with delays in transposing the directive.
The discussion was further developed in a panel moderated by Marta Dias, featuring Maria Rosário Fidalgo, representing the Commission for Equality in Labour and Employment (CITE); Susana Luz, from the Authority for Working Conditions (ACT); Vanessa Neves, HR Director at Perfumes & Companhia; and Nuno Oliveira, Chief People & Culture Officer at Zurich Insurance.
The panel focused on organizations’ level of preparedness and the concrete impacts of the directive, encouraging reflection on the challenges and adjustments required for its implementation. The discussion revealed differing perspectives on how prepared Portuguese companies are, based on a Mercer study indicating that around 30% of organizations in Portugal do not yet consider themselves ready for pay transparency.
Maria Rosário Fidalgo and Susana Luz emphasized that these figures should be interpreted in light of the experience with Law No. 60/2018, noting that there is still no consistent level of preparedness across sectors and organizational maturity levels. Vanessa Neves highlighted that the directive entails a structural shift in human resources management, increasing reporting requirements and the need for more robust data. Nuno Oliveira stressed that pay transparency should be understood as an ongoing and strategic journey, rather than a final state of compliance.
The panel also identified challenges related to data quality and reporting systems, with Susana Luz and Maria Rosário Fidalgo underlining the role of public institutions in providing technical support to organizations.