Global Pay Transparency: Why It’s Vital For Retaining Your International Employees

Pay transparency has become a critical global business issue as more countries implement laws requiring companies to disclose salary information.

But it’s not just about legal compliance. Pay transparency is also a factor in employee retention and motivation. In many countries, employees now expect to work for companies that make pay transparency and fair pay a priority.

For example, a survey of Canadian employees found that 40% of workers felt they were unfairly paid. Back in 2021, the recruitment company Indeed conducted a survey of US workers that found 74% of employees research fair pay.

And it’s not just North America. In 2024, a survey of European workers found that just over a quarter were dissatisfied with their pay package, while 6 in 10 European workers considered salary the most important factor when choosing a new organisation.

The message from the data is clear. Employees worldwide care about pay and it’s a factor in their decision about where they work and who they work.

If you’re employing staff internationally, pay transparency laws are something you’ll need to understand if you want to pay your global employees well and retain them in the long-term.

In this guide, we’ll explain how pay transparency regulations vary globally, their impact on your business strategy and how to ensure compliance with local regulations as you expand.

Global pay transparency: the opportunities for your business

Pay transparency isn’t just a legal requirement. For globalising businesses, it can be a strategic decision.

Done well, it can help you attract better talent, strengthen your brand, and build trust inside and outside the organisation. Done poorly (or ignored altogether) and it can lead to increased employee turnover, reputational damage or even legal action.

But when you’re a global company, things become that bit more complicated. Because as well as understanding the strategic advantages that arise from promoting pay transparency, you’re also going to need to understand how pay transparency and equality laws differ across countries.

But wherever you’re planning to build your global workforce, there are going to be clear advantages to making pay transparency a core principle of your wider HR strategy.

Recruitment and retention advantages

Being transparent about pay makes a real difference to how people feel about your business - even before they apply for a job.

For instance, a survey conducted by PwC in 2024 found that 82% of workers report feeling more productive and fulfilled when they believe they’re being paid fairly.

And indeed the perception of fairness matters just as much as the numbers themselves. The clearer and more open you are, the easier it becomes to attract and retain the right people.

Competitive advantages

Companies that embrace transparency don’t just build internal trust - they gain an edge in the market too.

• Your employer brand improves, making it easier to hire
• You’ll likely attract more diverse candidates
• Investors and stakeholders are more likely to see you as low-risk and forward-thinking

‍

The data backs this up. According to McKinsey,

“the companies in the top quartile for gender diversity were 15 percent more likely to have financial returns that were above their national industry median, and the companies in the top quartile for racial/ethnic diversity were 35 percent more likely to have financial returns above their national industry median.”

But as much as global pay equality is about taking advantage of opportunities, it’s also about minimising risks.

Non-compliance risks

If your company doesn’t meet legal requirements around transparency, the consequences can be serious — and expensive.

• Fines under EU regulations can reach €10 million or 2% of annual turnover
• You may be exposed to class action lawsuits or discrimination claims
• Public trust can erode, leading to investor pressure or consumer backlash
• Internally, employee satisfaction takes a hit — often before you realise

According to Payscale, employees are 50% more likely to leave a job if they believe they’re being paid unfairly - even if they’re actually paid competitively. Like we said before, perception matters.

Global pay transparency: legal & compliance considerations across borders

This is where things can get complicated — particularly if you operate across multiple countries. Pay transparency  rules vary widely by jurisdiction, but there are some recurring themes.

• Salary range disclosure: now required in job postings in places like the EU, Colorado, New York and California
• Pay gap reporting: mandatory in the UK, Australia and many EU member states
• Equal pay certification: required in countries like Iceland and Switzerland
• Salary history bans: common across U.S. states and increasingly in the EU
• Internal pay transparency: some jurisdictions now require companies to share pay structures with staff

Understanding the specific requirements in each country or state is critical — especially if you’re hiring globally.

How to stay compliant across borders

When your company operates across multiple countries, staying compliant isn’t just about knowing the rules — it’s about coordinating them.

Start with regular global pay equity audits. These help you spot discrepancies before they turn into problems. From there, build out compliance processes tailored to each jurisdiction — what works in the UK may not work in California or Zurich.

Documentation is also key. Make sure every pay decision is backed by clear criteria and consistent records. And while it might sound counterintuitive, it often makes sense to adopt the strictest standard across all regions where practical — it reduces the risk of inconsistencies later.

Centralised oversight helps keep everything aligned, but give your local teams the flexibility to adapt and apply those policies in a way that fits their context. The challenge isn’t just knowing the rules - it’s stitching them together into something coherent and sustainable.

‍

How global pay transparency affects the workplace

Done well, transparency reshapes the way people experience your company — both as employees and leaders.

When it’s handled well, pay transparency does more than just tick a legal box. It can reshape the way people experience your company — how they trust it, how they grow within it, and how they talk about it with others.

Promoting diversity, equity, and inclusion

Transparency gives DEI efforts real momentum. It helps remove unconscious bias from pay decisions, closes gender and racial pay gaps, and gives you tangible ways to measure progress.

More importantly, it builds trust — especially among groups who’ve historically been underpaid or overlooked. And this isn’t just an internal issue.

Generational shifts in expectations

Not every employee sees transparency the same way — but younger generations are changing the norm.

Gen Z and younger millennials often expect transparency from day one. They’re more likely to ask about pay structures, share their salaries with peers, and compare notes online. Digital access to compensation data isn’t seen as a perk — it’s the baseline.

And even if you’re not ready to publish everything, the conversation is happening anyway — especially on social media. It’s better to be part of that conversation than to be left reacting to it.

Proactive management of pay discrepancies

If you’re going to open things up, you need a clear plan for what happens when gaps come to light.

That might mean setting realistic timelines to correct discrepancies. It also means being open about your process — how you’re assessing pay, how corrections are made, and what’s changing going forward.

Managers play a key role here. Train them to speak confidently and constructively about pay. Give employees safe ways to raise concerns. And don’t stop at fixing the issue — put systems in place to make sure it doesn’t happen again.

Transparency doesn’t require perfection. But it does require progress — and a willingness to talk openly about how you're making things better.

Pay transparency for global business expansion

When you’re scaling internationally, pay transparency becomes more than a policy issue. It becomes part of your growth strategy.

Impact on global hiring

Being transparent about pay changes the way you hire -  and how you think about talent markets.

You may no longer be able to rely on cost differences across regions to keep salaries low. Job titles and classifications might need to be standardised, even if local markets function differently. You’ll need good quality, region-specific benchmarking data. And it’s worth gathering this data not just once a year, but continuously.

Remote work adds another layer of complexity. Employees working from different countries will have different expectations about pay fairness. And that’s where transparency helps: it makes your decisions feel understandable, not arbitrary.

Salary bands and localised pay structures

Striking the right balance between consistency and local relevance is one of the toughest parts of global pay.

You’ll need a job architecture that works across your whole organisation — but you also need local salary bands that reflect real market data.

Location-based adjustments need to be clear and fair, and your overall compensation philosophy should be something every employee can understand — wherever they’re based.

It’s not just about what you pay. It’s about making sure people understand why they’re paid that way.

Best practices for cross-market consistency

Companies that manage global transparency well tend to focus on three things: structure, clarity, and context.

They carry out regular market reviews to keep pace with local changes. They use a consistent global process for pay reviews and promotion pathways. And they document their decisions so that compensation is always evidence-based and easy to explain.

One thing that’s often overlooked? Cross-cultural training for managers. Pay expectations vary widely by region — and the way you talk about money in one country might not land well in another.

Ultimately, the goal is fairness — not sameness. A globally consistent approach can still leave room for local nuance. The key is to be thoughtful, transparent, and intentional at every step.

‍

How global pay transparency regulations vary by region

Pay transparency legislation varies dramatically across regions. In regions like Europe, pay transparency laws are much more wide reaching, with a new EU pay transparency law covering all member states across the economic bloc.

By contrast, in regions like the Middle East and North Africa, pay transparency legislation is only just emerging. In the USA, pay transparency legislation does exist, but it is more inconsistent across the various states.

Let’s take a closer look at each region.  

The European Union: leading the pay transparency movement

The EU Pay Transparency Directive, which took effect in June 2023, is one of the most comprehensive transparency frameworks globally. The directive requires:

• Salary information in all job advertisements.
• No salary history questions during recruitment.
• Right for employees to request pay level information for their category.
• Mandatory pay gap reporting for companies with 100+ employees.
• Action plans required if gender pay gap exceeds 5%.

Individual EU member states must implement these requirements into national law, with many already having their own regulations in place.

The deadline for EU states to transpose the Pay Transparency Directive into their national laws is 7th June 2026. So far, the following EU nations have taken steps to transpose the law.

• Ireland: published draft legislation in January 2025.
• Poland: published draft legislation in December 2024.
• Sweden: began to draft legislation through a consultation in mid-2024
• Belgium: On 12 September 2024, Le Parlement de la Communauté Française (Fédération Wallonie-Bruxelles) transposed the EU Pay Transparency Directive, possibly providing a road map for its implementation across Belgium.

In addition, Germany, the Czech Republic and Luxembourg have taken first steps to enact their own version of the fair pay legislation.

The United States: a patchwork of pay transparency laws

The USA lacks federal pay transparency legislation, resulting in a patchwork of state and city-level laws. Some states have already rolled out pay transparency legislation, others are planning to introduce it in 2025.

States with pre-existing legislation

California, Colorado, New York, and Washington are examples of states that have enacted laws requiring employers to disclose salary ranges in job postings.

States due to pass pay transparency laws in 2024

Ohio, Massachusetts, Minnesota and Vermont are examples of states where pay transparency laws will come into effect later in 2025.

Alongside pay transparency legislation, some states prohibit employers from asking candidates about their salary history during hiring.

This inconsistency creates significant compliance challenges for companies operating across multiple states.

United Kingdom: reporting without mandatory disclosure

Compared to the EU and some states in the USA, the UK takes more of a middle ground approach. It places more of an emphasis on reporting, rather than mandating disclosure.

Companies with 250+ employees must publish gender pay gap reports annually. But there is no requirement to disclose salary ranges in job postings and no prohibition on salary history questions during the recruitment process.

Middle East and Africa: emerging regulations

The Middle East has one of the highest employee turnover rates at 21%, partially attributable to pay dissatisfaction. Countries in this region are increasingly addressing transparency:

• UAE requires equal pay for work of equal value, though without explicit transparency mandates
• Egypt incorporates fair worker compensation in The Egyptian Labor Code
• Jordan has outlawed wage discrimination
• South Africa's Employment Equity Act requires equal pay for work of equal value

Asia-Pacific: varied approaches

The APAC region shows substantial variation across various countries.

• Australia requires gender equality reporting for employers with 100+ employees
• Japan has disclosure requirements for companies with 301+ employees
• Singapore has voluntary fair wage guidelines
• India has equal remuneration laws but limited transparency requirements

Countries with minimal requirements

Several major economies have limited or no pay transparency requirements:

• Brazil has equal pay laws but minimal transparency mandates
• Russia has few transparency requirements
• Many developing economies focus on minimum wage compliance rather than transparency

‍

‍