EU Pay Transparency Directive
Cyprus employers are entering a new era of workforce reporting and pay disclosure. The introduction of the ERGANI information system, together with the EU Pay Transparency Directive (“PTD”), is reshaping how companies collect, report, and share salary-related data. While these measures aim to create fairer, more transparent workplaces, they also bring new challenges—particularly the need to respect employee privacy.
The Push for Transparency
ERGANI (ΕΡΓΑΝΗ) has already digitised employment reporting obligations in Cyprus, creating a centralised platform to track staff movements and payroll data. This modern infrastructure lays the groundwork for further transparency obligations under the PTD, which requires employers to:
- Inform candidates of salary ranges for advertised positions, based on objective, gender-neutral criteria, to be attributed for the position concerned.
- Share objective criteria used for determining pay and career progression.
- Provide employees with comparative pay information, including gender pay gap data.
- Publish pay gap reports once workforce thresholds are met.
Any related information should be provided in a manner such as to ensure an informed and transparent negotiation on pay, such as in a published job vacancy notice, prior to the job interview.
These measures reflect a growing European commitment to tackling unjustified pay disparities and discrimination.
What Information Is To Be Reported
Employers should be able to report the following information:
- The gender pay gap;
- The gender pay gap in complementary or variable components;
- The median gender pay gap;
- The median gender pay gap in complementary or variable components;
- The proportion of female and male workers receiving complementary or variable components;
- The proportion of female and male workers in each quartile pay band;
- The gender pay gap between workers by categories of workers broken down by ordinary basic wage or salary and complementary or variable components.
Who Should Report?
- Employers with 250 workers or more: by 7 June 2027 and every year thereafter.
- Employers with 150 to 249 workers: by 7 June 2027 and every three years thereafter.
- Employers with 100 to 149 workers: by 7 June 2031 and every three years thereafter.
- On a voluntary basis any employer with fewer than 100 workers.
The Privacy Dilemma
However, transparency is not absolute. Under the General Data Protection Regulation (GDPR) and Cyprus Data Protection Law, employers are still responsible for protecting personal data. This creates a tension:
- Disclosing pay information must and should not inadvertently expose individual salaries or enable colleagues to identify one another.
- Gender pay gap reporting, especially in smaller teams, requires careful aggregation to avoid singling out individuals.
- Employees’ rights to information must be balanced against their colleagues’ rights to privacy.
A Balanced, Compliant Approach
To reconcile these obligations, Cyprus employers should adopt a structured strategy:
- Use ERGANI’s capabilities to maintain accurate, centralised records while limiting access to sensitive data.
- Establish internal protocols for responding to pay transparency requests, with clear safeguards to anonymise or pseudonymise data wherever possible.
- Update employment contracts, privacy notices, and HR policies to reflect new transparency and reporting duties.
- Conduct Data Protection Impact Assessments to identify and mitigate risks arising from expanded disclosures.
At AGPLAW, we advise clients on the intersection of employment law, data protection, and regulatory compliance.
As Cyprus businesses adapt to this evolving legal landscape, the ability to balance openness with privacy will be essential—not only for compliance but for building a culture of trust and fairness.
The information provided by AGPLAW | A.G. Paphitis & Co. LLC is for general informational purposes only and should not be construed as professional or formal legal advice. While every effort has been made to ensure the accuracy and reliability of the information contained herein, the author, publisher, or any related parties make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability of the information. In no event will the author, publisher, or any related parties be liable for any loss or damage, including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever arising from loss of data or profits arising out of, or in connection with, the use of this document/article. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice.
