Sweden and the EU Pay Transparency Directive: What HR Needs to Know in 2025

Introduction

Sweden has long been seen as a frontrunner in pay equity. Employers already conduct annual pay equity surveys under the Swedish Discrimination Act (Diskrimineringslagen). But with the new EU Pay Transparency Directive (Lönetransparensdirektivet), even Swedish companies will need to upgrade processes, increase transparency, and prepare for more detailed public reporting.

The law takes full effect in June 2026, and first reporting deadlines begin in 2027, so preparation needs to start now.

In this article, we break down:

• What’s already required under Swedish law

• What’s changing with the EU directive

• What practical steps Swedish HR and comp teams can take today

The Current State: What Swedish Law Already Requires

Under Sweden’s Discrimination Act (2008:567), employers must:

• Conduct an annual equal pay analysis (lönekartläggning)

• Identify pay differences between employees doing work of equal value

• Analyze gaps between “women-dominated” and “non-women-dominated” jobs

• Document results and planned adjustments (mandatory if 10+ employees)

• Submit this documentation to the Diskrimineringsombudsmannen (DO) if requested

This already puts Sweden ahead of most EU countries.

What the EU Pay Transparency Directive Adds

The Directive introduces a more structured and public approach. Here are the most relevant new obligations for Swedish employers:

1. Salary Range Transparency in Hiring

• Must be provided to candidates before interview

• Collective agreement terms must also be disclosed before salary negotiations

• Asking about salary history is banned

2. Transparency for Current Employees

• Must publish the objective, gender-neutral criteria used to set pay and progression

• Must inform employees annually of their right to request pay comparisons

• Employees can request this info via representatives, not just directly

3. Gender Pay Gap Reporting

• Mandatory public reports for companies with 100+ employees

• Data must include:

  • Mean and median gender pay gap (base + variable pay)

  • Pay quartiles by gender

  • Pay gaps for each “category of workers”

• Timeline:

  • 2027: 250+ employees (annual)

  • 2027: 150–249 employees (every 3 years)

  • 2031: 100–149 employees (every 3 years)

4. Joint Pay Assessments

If a pay gap of ≥ 5% in any group is not justified and not fixed within 6 months, a formal joint pay assessment with employee reps is required.

What’s Different in Sweden’s Implementation

Sweden’s draft law goes beyond the minimum directive:

Important: The current lönekartläggning requirements for employers with 10–99 employees will remain in place, even though the EU directive formally applies from 100+.

What Employers in Sweden Should Do in 2025

Here’s a checklist of high-impact steps to prepare now:

1. Clarify Job Architecture

• Define clear job levels and categories of work of equal value

• Use gender-neutral criteria (skills, responsibility, effort)

2. Prepare for Gender Pay Gap Reporting

• Gather base + variable pay data by gender

• Run preliminary gap calculations by job category and quartile

• Identify any unexplained gaps > 5%

3. Get Ready to Communicate

• Document your salary setting logic and progression rules

• Publish (or make available) to employees

• Inform employees of their rights annually

4. Modernize Your Hiring Materials

• Add salary ranges + union agreement info to job descriptions

• Remove salary history questions

• Ensure contracts don’t include confidentiality clauses

5. Assemble a Cross-Functional Working Group

Involve HR, legal, comp & benefits, payroll, and finance.

How Compensara Can Help

Compensara helps Swedish employers automate much of this work:

• Structure and standardize job levels

• Benchmark salaries with internal + external data

• Simulate pay strategy to ensure correct positioning

Preparing for pay transparency shouldn’t require weeks of manual work or expensive consultants.

Let us help you get compliant, and confident.

Final Thoughts

Sweden is in a strong position to lead on this directive. But “already compliant” isn’t the same as “fully prepared.”

The EU Pay Transparency Directive makes internal pay practices public, and puts the burden of proof on you. Companies that start now will be ready to handle it smoothly. Those that wait risk rushing or falling short.