Salary ranges and reporting attract the headlines, but can organisations explain the decisions behind the numbers?
There is a lot of noise around the EU Pay Transparency Directive. For employers operating in EU member states, national implementation is turning one directive into a patchwork of local detail. For UK-only organisations, the legislation may not apply directly, but the direction of travel is difficult to ignore: candidates and employees increasingly expect clearer answers about how pay works.
Most commentary focuses on salary ranges, reporting and disclosure. These do matter, but I think they distract us all from the more uncomfortable question: “Can my organisation explain the decisions sitting behind the numbers?”
Too many leadership teams are treating Pay Transparency as another compliance exercise, a set of rules for HR and Legal to process. That is a mistake. Strip it back and the underlying challenge is simple: can you explain why people are paid what they are paid?
- Why is one role paid differently from another?
- Why did one person join on a different salary from somebody doing the same work, or work of equal value?
- Which factors genuinely explain individual differences within a range?
- Can we show that those decisions rest on objective, gender-neutral criteria rather than habit, unchecked discretion or organisational legacy?
Let’s bust some myths.
Myth 1: Transparency causes problems
Transparency does not cause weakness, it reveals it. The organisations most anxious about transparency are often those that have never had to answer these questions consistently. Pay arrangements grow organically: roles expand, exceptions are made, managers exercise discretion and yesterday's pragmatic solution becomes today's unexplained anomaly. None of that is unusual, but transparency will often expose complexity.
Once employees can see more, they’ll ask more. A decision that once felt obvious can become surprisingly difficult to defend. That makes Pay Transparency a workforce governance and data challenge, not just a communications exercise.
Myth 2: publishing a range means the job is done
Publishing a salary range is relatively straightforward. Explaining the rationale underneath it is not. When an employee asks why their role sits in a particular grade, 'because it always has' is no longer a credible answer. On its own, a market median is also an incomplete explanation of internal fairness.
The Directive is built around equal pay for equal work or work of equal value. It moves the conversation beyond job titles and asks organisations to examine how work is compared. Pay structures must support that assessment using objective, gender-neutral criteria. The Directive says those criteria must include skills, effort, responsibility and working conditions, alongside other relevant factors where appropriate.
It does not prescribe one branded job evaluation methodology or require every employer to build an identical job architecture, but that is not carte blanche to rely on intuition. Employers still need a consistent, accessible and defensible way to establish which roles are comparable and how pay and progression are determined.
Myth 3: Uncomfortable and inconvenient working conditions increase salaries
Working conditions are a good example of where myths can creep in. The term does not mean that every uncomfortable or inconvenient feature automatically increases salary. It means the reality in which work is performed must be considered when assessing whether roles actually are of equal value.
Physical environment, unsocial patterns, emotional demands, sustained concentration, travel or exposure to risk may be relevant, depending on the role. The point is not to rank one type of work as inherently more valuable. It is to make sure relevant demands are not overlooked because they are less visible, historically undervalued or associated with a workforce dominated by one gender. Some conditions may influence job value. Others may be better recognised through a separate premium or allowance. The discipline is to decide deliberately, apply the approach consistently and prevent double counting.
Get your jobs sorted
My advice to every CEO and CHRO is simple: if you do nothing else, get your jobs sorted. Not because the Directive names job architecture as a mandatory product (it doesn’t) but because you need a credible way to understand, compare and explain work.
For most employers, that means defining roles consistently, understanding how they relate to one another, assessing work through objective criteria and connecting job value to a coherent pay structure. It also means recording why people sit where they do within a range and equipping managers to explain those decisions.
Start with one question: can we explain why people are paid what they are paid? If the answer is yes, you may be further ahead than you think. If the answer is no, do not start by publishing more numbers. First, understand the value of work across your organisation and if you need help with that, Innecto can help turn that accountability into practical job architecture, fair-pay frameworks and confident pay conversations.
Sarah Lardner is Director of Business Innovation at Innecto Reward Consulting
