The rules around recruitment and pay in Malta are changing. Thanks to the new EU Pay Transparency Directive, employers and recruiters are facing a shift in how salary is discussed, disclosed, and decided upon, both before and during employment.

While the legal details are best left to employment lawyers, this article is here to help you discover how the EU Pay Transparency Directive reshapes recruitment, salary transparency, and HR strategy in Malta. Prepare now to stay compliant and competitive.

What is the EU Pay Transparency Directive all about?

The EU Pay Transparency Directive is designed to promote fairness, close gender pay gaps, and ensure that employees doing work of equal value receive equal pay. But what does that mean for hiring and employee management?

At a glance, here’s what the directive introduces:

  • Salary ranges must be disclosed to candidates, typically through job adverts.
  • Employers and recruiters may no longer ask about a candidate’s current salary.
  • Pay secrecy clauses are banned, giving employees the right to talk openly about their pay.
  • Employers must be able to demonstrate pay equity for employees performing the same or equivalent work.

EU Member States, including Malta, have until 7th June 2026 to integrate the directive into national law. However, forward-thinking employers are already adapting their hiring and internal pay strategies today.

How will this change your hiring process?

This EU Pay Transparency Directive significantly shifts both the power dynamic and timeline of salary conversations. Here’s how:

1. Salary conversations are happening earlier

Salary is no longer a negotiation left until the final stages of the hiring process. Candidates can expect to see salary ranges upfront and will likely initiate compensation-related conversations much earlier. This will require a shift in how recruiters and hiring managers are trained, because those early conversations must now be consistent with internal pay structures.

HR Reflection: Stating pay ranges upfront could challenge some long-standing recruitment norms, but it also levels the playing field and builds trust. For top talent, clarity on pay early in the process may be the deciding factor between two competing offers.

2. No more asking about current pay

Hiring decisions must be based on the value of the role, not the candidate’s past compensation. Structured frameworks and benchmarking will become essential in determining offers, without relying on historical pay, which past inequities may have shaped.

This is an opportunity to reset how we define “worth.” Rather than anchoring offers to a candidate’s previous employer, we begin by defining what the role is truly worth in our organisation, placing equity and objectivity at the centre of our offer strategy.

3. Candidates and employees are more informed (and more inquisitive)

Expect sharper questions about internal pay equity, career progression, and how job roles are evaluated. If challenged, employers must be able to justify how job evaluation and categorisation were done.

Transparency invites scrutiny, but it also offers an opportunity. Organisations that can explain their internal structures with confidence and fairness will stand out. Those who can’t, may see top talent walk away, even if the salary is attractive.

4. Offers must be justified

Salary offers can no longer vary significantly for the same role. Instead, they must be rooted in evidence-based job evaluation frameworks. Hiring teams must know how to position a candidate within a salary band and what distinguishes someone at the lower versus higher end of that range.

Beyond hiring: What does this mean for pay transparency during employment?

While most conversations around the directive have focused on recruitment, it’s equally important to consider its impact on current employees. Pay transparency doesn’t stop at hiring, but it needs to be embedded into your organisation’s culture and day-to-day operations.

Here are the key requirements employers must keep in mind:

  • Right to information: Employees can request details about their pay level and the average pay levels of others doing the same or equivalent work. These comparisons must also be broken down by gender. Employers must anticipate these requests and ensure they can respond consistently, fairly, and quickly.

  • Access to pay criteria: Employers must provide clear and accessible information on how pay levels and salary progression decisions are made. This includes objective and gender-neutral criteria used, such as required skills, responsibilities, or effort. This will inevitably push organisations to re-examine their career progression frameworks. Are promotions based on transparent benchmarks or informal judgments? This is a real opportunity to build clarity and trust.

  • Ban on pay secrecy clauses: Employees are now free to discuss their pay without fear of reprisal. Pay secrecy clauses will be prohibited. This, without doubt, creates a cultural shift. Conversations about pay used to happen behind closed doors, however, now, they’ll be more open. That means inconsistencies will be more visible and potentially more damaging if not addressed.

These changes mean HR and leadership teams will need to review systems, processes, and internal capabilities:

  • Is your payroll and HR system equipped to handle individual and comparative data requests?
  • Do your line managers and employee representatives understand the new rights and how to respond to them?
  • Have you reviewed your collective agreements or classification systems to ensure they hold up under scrutiny?

Whether you’re a small team or a large organisation, these requirements are not optional. Even if formal reporting thresholds don’t apply to you, employees still hold the individual right to information and that means as an employer you must be ready to respond with clarity, accuracy, and confidence.

What does this mean for your employer brand?

Pay transparency doesn’t just affect internal processes, but it profoundly shapes your employer perception and reputation in the market.

Your job adverts are now, more than ever, a public-facing statement about how much you value your people. A salary range that is well below market expectations could signal a lack of investment, even unintentionally.

Including a pay range is the bare minimum. The real opportunity lies in how you position your offer, making it not just legally compliant but also compelling to the right talent.

Candidates can now compare your salary offer with other employers by just looking at your job advert. So your competitive edge lies not just in how much you offer, but also in how you frame and justify it using standardised and objective tools.

Handled well, transparency builds trust, reinforces your commitment to fairness, and attracts values-driven talent. Organisations that embrace the shift, rather than simply comply with it, will strengthen their reputation and long-term talent pipeline.

How can you stay ahead?

So, how can you begin preparing today? Here are some proactive steps employers and recruitment professionals can take:

Analyse your job levels

Start with a thorough job evaluation process to determine the relative value of roles across your organisation. The focus here isn’t on individuals, but on the roles themselves. By comparing jobs rather than incumbents, you can create a pay structure that is fair, consistent, and defensible. This helps ensure that employees are paid in line with the value of their role and that entry and performance criteria are clearly defined.

Invest in reliable salary benchmarking tools

Use external market data such as salariesinmalta.com to align your salary bands with fair and competitive standards. Real-time benchmarking supports equity, improves market positioning, and strengthens your case during salary negotiations. While formal reporting obligations apply only to organisations with 100+ employees, all employers should be prepared to respond to employee requests regarding pay.

Train your hiring teams

Equip hiring managers and recruiters to navigate pay discussions confidently and compliantly. Clarify what they can and cannot ask and prepare them for early-stage conversations that are now more transparent and potentially more sensitive.

Use this time to upskill employee representatives

Whether your organisation operates under a collective agreement or not, now is a great time to ensure your employee representatives understand the directive and are aligned with any revisions to job categorisation or pay structures. Speaking of collective agreements, don’t assume that existing job levelling is suitable simply because “it’s always been that way.” Use this opportunity to collaborate with your union representatives and ensure your collective agreement reflects a fair and defensible job categorisation under the Pay Transparency Directive.

Know your legal responsibilities

Understand your organisation’s obligations around pay transparency and reporting. Even if you fall below the 100-employee threshold, employees across all organisations will still hold the individual right to request information and access pay criteria. Team up with legal counsel, and ensure your HR and finance teams can generate accurate, compliant data and respond effectively to these requests.

Standardise your job offers

Create clear salary bands for each role and guidance on how to position candidates at the lower or higher ends of those bands. You may wish to allow for some flexibility to tailor offers based on experience or qualifications but always within a non-discriminatory, transparent, and objectively justifiable framework.

Stay transparent with your recruiter

Your recruitment partner plays a crucial role in the hiring process. By sharing your salary frameworks openly, you enable them to position your roles competitively, provide informed advice on market trends, and manage candidate expectations effectively. At Konnekt, we collaborate with hundreds of clients and conduct over 4,000 interviews each year. With this wealth of experience, we’re well-equipped to support our clients throughout this journey.

Recruitment can still be your advantage

Pay transparency may feel like a burden, but it's also a strategic opportunity. Done right, it:

  • Reinforces fairness
  • Enhances employer branding
  • Improves long-term recruitment and retention

The directive calls for change, but it also creates space for smarter, more strategic recruitment and retention.

Need Support?

At Konnekt, we're already helping clients navigate pay transparency. From salary insights to structuring offers, we're here to help you lead with confidence.

Ready to prepare for the EU Pay Transparency Directive? Reach out to us on info@konnekt.com we’re happy to help.