Wet Loontransparantie (Dutch Pay Transparency Act)

How do you determine what to pay an employee or temporary agency worker? And can you explain why one person earns more than another? The Wet Loontransparantie (Dutch Pay Transparency Act) will introduce greater transparency around pay. Employers will need to be clearer about how salaries are determined and ensure equal pay for equal or equivalent work.

The new rules will affect how you recruit, determine salaries and set employment conditions. We explain what is changing, when the new rules are expected to take effect and what you can already do to prepare.

What is the Wet Loontransparantie?

The Wet Loontransparantie (Dutch Pay Transparency Act) implements a European directive aimed at reducing gender pay differences for equal or equivalent work. Greater transparency should make pay differences more visible and ensure that they can be properly explained and addressed.

The legislation will require employers to be more transparent about how jobs are evaluated and how salaries are determined. Job applicants and employees will also have greater rights to information about pay.

The Dutch legislation is expected to take effect on January 1, 2027. The bill is currently being considered by the Dutch Parliament.

What does this mean for you?

The new legislation will affect several areas of your organization. The main changes concern:

1. Vacancies and recruitment: candidates must receive information about the salary or salary range for a position, and employers may no longer ask about a candidate's previous salary.

2. Pay policy: employers must be able to explain how jobs are evaluated and how salaries are determined.

3. Access to pay information: employees and temporary agency workers will have greater rights to information about their own pay and the average pay of people doing equal or equivalent work.

4. Gender pay gap reporting: employers with 100 or more employees will have to report on gender pay differences.

What do these changes mean for you as a client of Timing? We explain the main changes below.

Vacancies and recruitment

The rules for vacancies and recruitment will change. If you work with Timing and are looking for a new temporary agency worker, we will make sure our recruitment and selection process complies with the new rules. To do this, we need accurate information from you about the position and the applicable salary or salary range.

Candidates must be informed about the salary or salary range for a position before they accept the job. This information can, for example, be included in the vacancy. Employers may not ask candidates about their salary at a previous employer.

Job titles and vacancies must also be gender-neutral, and recruitment and selection must be carried out without discrimination.

Example:
You are looking for a new sales employee. Instead of stating only "salary negotiable", you could specify a salary range of €2,500 to €3,000 gross per month. During the recruitment process, we will not ask the candidate what they earned at their previous employer.

What does this mean for you?

To provide candidates with the right information, Timing needs accurate details about the position and the applicable salary or salary range. We use this information to ensure that the vacancy and recruitment process comply with the new rules.

Pay policy and job evaluation

The new rules require employers to be more transparent about how pay is determined. You must be able to explain which objective and gender-neutral criteria are used to determine the salary for a particular job and how employees can progress within the salary structure.

These criteria can include work experience, knowledge, skills, responsibilities and the level of responsibility associated with the job.

Example:
Two temporary agency workers perform similar work but receive different salaries. The difference in pay must be explainable based on objective criteria, such as greater work experience or additional responsibilities.

What does this mean for you?

Your organization should have a clear pay structure and be able to explain which criteria determine an employee's salary. This can include salary scales, work experience, knowledge, skills and responsibilities.

For temporary agency workers employed through Timing, we use this information to determine the applicable employment conditions. If your pay policy or salary scales change, please inform your contact at Timing. This ensures that the employment conditions of temporary agency workers remain aligned with your current pay structure.

Greater transparency around pay

The new rules will give employees and temporary agency workers greater insight into how their pay is determined. They will be able to request information about their own salary and the average salary of people doing the same or equivalent work. This information will be broken down by gender.

Employers must also be able to explain which criteria determine pay. For organizations with 50 or more employees, this also applies to salary progression. This makes it clearer why someone receives a particular salary and helps employers explain any pay differences.

Example:
A temporary agency worker wants to know how their salary compares with that of people doing similar work. They can request information about their own salary and the average salary for comparable work, broken down by gender. They are not entitled to the individual salary of a specific colleague.

What does this mean for you?

Employees and temporary agency workers will have greater rights to information about pay. A temporary agency worker can request this information from Timing as well as directly from the company where they work.

It is therefore important that you have a clear and well-documented pay structure and can explain the criteria used to determine salaries.

If you work with temporary agency workers through Timing, we need this information from you. This enables us to answer questions about pay and provide temporary agency workers with the correct information.

Reporting on the gender pay gap

Employers with 100 or more employees will have to report on gender pay differences.

When determining the size of the workforce for this reporting obligation, temporary agency workers and payroll employees are also counted and attributed to the company where they work. This means that the temporary agency workers and payroll employees working for your organization may affect whether you fall within the reporting requirements.

Employers with 100 to 249 employees will report every three years. Employers with 250 or more employees will report annually.

For employers with 150 or more employees, the first report is expected by June 7, 2028, covering pay differences in 2027. Employers with 100 to 149 employees will report for the first time by June 7, 2031, covering 2030.

The report will include information such as the average and median gender pay gap, additional or variable pay, and the distribution of men and women across different pay levels.

If there is a gender pay difference of more than 5% that cannot be objectively and gender-neutrally explained, a joint pay assessment may be required and the difference must be addressed.

What does this mean for you?

Do you have 100 or more employees, including temporary agency workers and payroll employees attributed to your organization? Make sure your pay data is properly recorded and that you have insight into any gender pay differences within your organization.

Even if you have fewer than 100 employees, it is important to have a clear pay policy in place. The rules on pay transparency, job evaluation and information for applicants and employees apply more broadly than the reporting obligation.

How is Timing preparing?

Timing is preparing for the new legislation. We are setting up a straightforward process through which temporary agency workers will be able to submit requests for information about their pay.

We are also working on reporting tools for clients to support information requests and the reporting obligations that will apply from 2028.

Webinar on new employment laws and regulations

The Wet Loontransparantie (Dutch Pay Transparency Act) is one of several changes to the Dutch labor market. The Wet Meer Zekerheid Flexwerkers (Act on More Security for Flexible Workers) and the Wtta (Act on the Admission of the Provision of Workers) will also introduce new rules.

During our webinar on new employment laws and regulations, we discussed what these changes mean for you as a client of Timing and what you can do to prepare.

Did you miss the webinar? Watch the recording to find out what you need to know and how you can prepare.

Get ready for the Wet Loontransparantie

Do you have questions about the Wet Loontransparantie (Dutch Pay Transparency Act) or want to know what the new rules mean for your organization? Please contact your Timing representative.

Together Prepared for the Wage Transparency Act

Do you have questions about the Wage Transparency Act or want to know what the new rules mean for your organization? Then feel free to contact your contact person at Timing.