IR Notes

Directive 2023/970, adopted on 10 May 2023, is intended to boost equal pay and pay transparency in all EU Member States (see IR Notes 205). It sets a deadline of 7 June 2026 for countries to transpose this directive into their domestic law. However, a Eurofound study published in late October 2025 already showed that progress in its transposition in all Member States was still limited. Thus far, implementation of the directive is proving to be unequal and complex, creating a mosaic of rules, which in turn is making it difficult for companies and workforce representatives to harmonise their practices. First of all, the directive’s transposition is significantly behind schedule in many countries. Despite a period of three years being allowed for transposition – rather than the two years usually allowed for social directives –, several Member States have not yet finalised their legislation. In France, for example, the draft law is still being discussed with the social partners, and looks set to miss the 7 June 2026 deadline. A partial implementation is scheduled only in 2027. In Denmark, the directive’s application is not expected before 1 January 2027. So far, only the Wallonia-Brussels federation in Belgium has completed the transposition process. These delays mean an equivalent delay in implementing the employers’ obligation to provide information on pay scales and to publish reports on pay gaps. Next, Member States are interpreting and applying the directive in very different ways. The leeway left by the European text permits adaptations, or even “over-transpositions”, i.e. measures that go beyond the minimum requirements. For example, in France, the draft law stipulates that job applicants must be notified of an initial pay range, whereas in Italy, they must be told the exact amount of the proposed wage. Another point of divergence concerns the report on gender pay gaps, which must include variable and supplementary components. The directive requires companies with 250 or more employees to publish an annual report, while those with between 150 and 249 employees must publish a report once every three years. Companies with between 100 and 149 employees will have eight years to produce their first report, and they will then have to update it once every three years. Yet some countries are imposing a stricter version of these obligations: in Italy, all of the employers concerned will have to produce this report on an annual basis, while in Denmark, the threshold is reduced to 100 employees. France, for its part, is maintaining its current threshold of 50 employees, linked to its existing “Equality Index”. Lastly, the methods used to assess pay gaps also vary from one country to another. In Italy, this analysis is based primarily on collective agreement categories, even though a company’s internal classification may be taken into account. In Denmark, employers will have to use the country’s official DISCO nomenclature, which classifies occupations into 372 occupational subgroups. These differences in methodology complicate the task of making data comparisons between countries and make the work of workforce representatives harder at European level. When all is said and done, while the objective of pay transparency is a shared one, its implementation continues to be fragmented. Workforce representatives will have a key role to play if they are to ensure that the principles of equality and transparency are effectively applied, despite the disparities between Member States.

The “Omnibus I” directive has completed its journey : One year after the European Commission published its first “Omnibus” proposal, on 26 February 2025, the text – which amends the corporate sustainability reporting (CSRD) and due diligence directives – was published in the OJEU the day after the Council granted its final approval. Companies’ management and employee representatives will now have an official version of the text in their own language – a development that will facilitate the directive’s application, by removing the need to consult the multiple compromise texts that preceded its final adoption. The directive, which will come into force on 19 March, has significantly increased the thresholds at which the CSRD and CS3D become applicable. Previously, the CSRD directive applied to companies with 250 or more employees, but it now applies to those with over 1,000 employees and an annual turnover in excess of 450 million euros (rather than 40 million). For its part, the due diligence directive now applies only to companies with more than 5,000 employees (rather than 1,000) and a net turnover in excess of 1.5 billion euros (rather than 450 million euros). The revision also introduces a number of changes offering businesses greater flexibility. As far as due diligence is concerned, the text allows a company that has identified several equivalent risks (i.e. having the same level of seriousness or probability) not to tackle them all at once: instead, it can choose to start with the ones linked to its direct business partners, i.e. suppliers or subcontractors with which it has a direct contractual relationship. The CS3D obligation requiring businesses to adopt a transition plan for climate change mitigation has been abolished. The directive postpones the deadline for transposing the CS3D into domestic law by a further year, fixing this at 26 July 2028. Andreas Rasche, Professor and Associate Dean at Copenhagen Business School, comments: “While politicians can simplify laws, they cannot simplify the massive environmental and social problems that European businesses must address”. Moreover, while the legal obligations have disappeared, the requirements imposed by banks, investors and business partners remain in place, and many businesses will still have to publish very detailed reports and demonstrate their due diligence credentials, if they are to secure financing on favourable terms.

European Globalisation Adjustment Fund : On 25 February, the Council reached a provisional agreement on the proposal for a regulation to expand the scope of application of the European Globalisation Adjustment Fund for displaced workers (EGF). Once it has been formally approved by the Council and Parliament, the text will be published in the OJEU. The proposal, which was presented by the European Commission on 1 April 2025 (see IR Notes 249), seeks to expand the scope of EGF aid, so that it will apply not only to dismissed workers but also “to workers affected by imminent job displacement in enterprises undergoing restructuring”. The EGF’s intervention should enable them to “acquire the skills they need to transfer either into a different role with their current employer or to a different employer”. The workers concerned are those “whose employment contract or relationship is expected to be ended by redundancy according to the written communication from the employer to the workers’ representatives informing them, during the course of the consultations with them, inter alia, of the number and categories of workers to be made redundant in accordance with Article 2(3) of Directive 98/59/EC”. The employees in question must be the subject of a projected collective redundancy of at least 200 workers in an enterprise undergoing restructuring, though exceptions to this threshold are provided for. The application for intervention is to be formulated by the company and then referred to the Commission by the Member State concerned, within tight deadlines. Furthermore, with regard to the totality of applications for aid (concerning employees who either have already been, or are at risk of being, made redundant), EGF funding in favour of any given enterprise shall not exceed 4 million euros per Member State for any given financial year. The text emphasises that “this provision seeks to limit the risk that any individual enterprise depletes the funding resources, and to ensure that funding will be available for restructurings across different Member States” – a change that will rule out aid on the scale of the €17.7 million spent on supporting 1580 former Air France employees in 2022 and the €12.8 million on 2,500 former BenQ employees after the company was declared bankrupt. Since 2007, the EGF has intervened in 186 cases, and spent 727 million euros on helping more than 181,167 workers in 20 Member States. According to the latest data for 2023-2024 (report and annex), 81% of redundant employees found a new job within 18 months after EGF funding was granted (see EGF page on the Commission’s website, a list of EGF funding applications granted and press releases issued by the Council and the Commission).

• Restructuring : On 2 March, the European Commission proposed mobilising 2 million euros from the European Globalisation Adjustment Fund to support 507 workers who were dismissed in April 2025, following the bankruptcy of the steelmaker Liberty Steel Belgium (see press release).

• Employment and Social Affairs Council : On 9 March, among other steps taken, the Employment Ministers of the Twenty-Seven adopted a recommendation on human capital, which will provide guidance to Member States on tackling labour and skills shortages across the EU. The Ministers also exchanged views on the use of AI to strengthen quality jobs and workers’ rights (see Council press release).

Hairdressing : On 2 February, the European social partners in the hairdressing sector (UNI Europa and Coiffeur EU), issued a joint declaration calling on, among others, the European Commission and Member States to curb bogus chair renting in hairdressing salons, a practice that “poses a serious threat to sustainability, professionalism, and fair working conditions in the sector”, according to the signatories (see UNI Europa press release).

A “right to make a new start” : As of 1 March, employees who have more than ten years’ career experience can exercise their “right to make a new start”, a benefit also known as the “trampoline bonus”, which was established via the programme law of 18 July 2025. This mechanism entitles workers to receive unemployment benefits for a six-month period after they have resigned from their job, of their own free will. The aim is to make it easier for employees who can demonstrate, via an application submitted in advance and checked by the public employment department (ONEM), that they have a clearly structured plan to retrain for a different occupation. This period can be extended for a further six months if the employee is training for an occupation experiencing a labour shortage.

Transgender workers : On 26 February, the government and the two trade-union confederations CCOO and UGT signed a Memorandum of understanding in support of transgender persons in the workplace. This agreement affirms the undertaking given by Article 15.1 of Law 4/2023 of 28 February 2023 for genuine and effective equality for transgender persons and for guaranteeing the rights of LGTBI persons, affirming the integration of trans people into the employment market. The memorandum establishes a set of recommendations on how to recognise and show respect for the gender manifested by the worker (e.g. acknowledging legally recognised pronouns). This memorandum demonstrates the commitment on the part of the Spanish Ministry of Labour and the social partners to create a working environment that is more respectful of diversity (see press releases issued by the government, the CCOO and the UGT).

Strengthening collective bargaining : The law on strengthening collective labour agreements has entered into force. Following a public consultation in February (see IR Notes 266), it was approved by Parliament with a number of minor amendments. Among other things, this law seeks to boost the number of employees covered by collective labour agreements, to promote collective bargaining and to improve the framework governing the conclusion, implementation and extension of collective labour agreements. It also seeks to fully protect employees after a collective agreement has expired, and to speed up and rationalise the procedures for resolving industrial disputes.

AI Observatory publishes its first report on employment : In 2025, Italy took the pioneering step of launching its AI regulations, to implement the European rules (see IR Notes 259), and a national observatory to monitor AI’s impact on employment. The Observatory recently published its first report, on 19 February. This reveals geographical disparities in the use of AI and highlights an imbalance between skills and training, and in particular the gap between supply and demand when it comes to STEM professionals. It also shows that businesses have been slow to invest in digitalisation processes (see press release).

Climate changes : On 5 March, the Malta Council for Economic and Social Development (MCESD – a tripartite consultative body for social dialogue) – examined the issues of disaster preparedness and emergency coordination, at the request of the Malta Hotels and Restaurants Association (MHRA). This meeting, which focused on climate change, highlighted growing concerns linked to its effects in a country where tourism is an important industry. The discussions covered measures firstly to raise awareness of actions that need to be taken and secondly to improve coordination between the social partners, public bodies and the government (see press release).

Temporary work : Since the start of the year, temporary workers have been entitled to receive remuneration equivalent to that of a permanent employee in the same job (see press release). However, this measure has not led to any significant improvement in working conditions. Temporary-work agencies are finding it hard to precisely define these equivalent pay levels, especially when it comes to the inclusion of housing deductions. In addition, organisations representing temporary-work agencies have signed an agreement to apply this rule with the trade union LBV, and not with one of the three main trade unions, which raises questions about representativeness.

Online employment contracts : On 24 February, the Council of Ministers adopted a plan to establish a centralised digital system for managing contracts of employment. This platform will enable employers to conclude, amend or terminate contracts, and to use standardised template documents (see press release). It will be freely accessible to everyone, and will also cover other types of agreements, including those related to training. This initiative should also simplify the administrative steps involved, especially in terms of recruiting foreign workers.

A major merger in aerospace : On 22 October 2025, the Airbus, Leonardo and Thales groups announced the signing of a memorandum of understanding aimed at grouping together their space activities within a new entity, to be known as Bromo. The stated aim is to “create a leading European player in space” (see press release). The new company will employ around 25,000 people across several European countries. With an estimated annual turnover of 6.5 billion euros (pro-forma, end of 2024) and an orderbook covering more than three years of projected sales, Bromo’s critical size will enable it to innovate and compete at global level with rivals such as the Starlink network. Trade-union officials representing employees of all three groups – based in Belgium, France, Germany, Italy, Poland, Spain and the United Kingdom – met under the auspices of IndustriAll Europe on 1 December 2025. Their aim was to work out a joint approach to dealing with this merger. Among other things, they called for jobs and production sites to be preserved, for working conditions to be maintained (by retaining collective agreements for transferred employees), and for workforce representatives’ rights to information and consultation to be respected at every stage of the project and at all levels (see press release). In a joint letter to the managements of Airbus, Thales and Leonardo, 14 trade unions from several European countries pooled their demands. They call for concrete guarantees within the framework of the merger, including: 1/ the negotiation, as soon as Bromo is created, of a new European Works Council including representatives of all the countries concerned, and at minimum, incorporating the best social practices and expertise of the existing EWC agreements in place at Airbus, Thales and Alenia Space; 2/ a guarantee of employee representation on the board of directors of the Bromo  holding company.

Relocation to India : The German chemical group BASF has announced the creation of a new shared services centre in India. This site will centralise the company’s financial and personnel management services, which are currently based in Europe. Employee representatives are expressing fears about the consequences of this decision, including that thousands of jobs will be moved offshore, especially from the shared services centre in Berlin (see IG BCE and IndustriAll Europe press releases).