Denmark’s Pay Transparency Rules: How Small Employers Can Prepare

The deadline for EU member states to adopt the new pay transparency rules passed on 7 June 2026, and Denmark is among the countries that have not yet completed the job. According to a transposition overview published by Ius Laboris on 30 September 2026, only Italy and Slovakia had fully transposed the directive at that point. For Danish employers, that delay is not a reason to wait. The Danish bill still points to 1 January 2027 as the start date, and several of its core rules apply to every employer, regardless of size.

What Happened

The rules come from Directive (EU) 2023/970 on pay transparency and equal pay for men and women. Member states were required to bring it into national law by 7 June 2026. In Denmark, the Ministry of Employment sent a draft amendment to the Equal Pay Act out for consultation on 26 February 2026, with a consultation deadline of 27 March 2026, as described by DLA Piper and Littler. The general election held on 24 March 2026 created uncertainty about the timing, but PwC Denmark, in an update dated 10 September 2026, expects implementation to go ahead, with the bill proposing entry into force on 1 January 2027.

As of today, the law has not been adopted. Azets noted on 11 August 2026 that the proposal was still a consultation draft and that the 1 January 2027 date should not be treated as final until the Folketing has passed the bill. Finansforbundet expects the bill to be dealt with when the Folketing reconvenes after the summer. Details may therefore still change, but the main structure is set by the directive itself.

Why the Pay Transparency Rules Matter for a Small Business

Much of the public discussion focuses on gender pay gap reporting, which only affects larger companies. Under the Danish draft, as summarised by PwC and Littler, employers with 250 or more employees would submit their first report by 1 September 2028 and then report annually. Employers with 150 to 249 employees would also report first in 2028, then every three years, while employers with 100 to 149 employees would start in 2031. DLA Piper notes that Statistics Denmark is expected to produce the reports from existing salary data, although employers may need to add information about which employees perform equal work.

The rules that matter most for a startup or a small team are different. Article 5 of the directive requires employers to give applicants information on the initial pay or its range, based on objective, gender-neutral criteria, for example in the job advertisement or before the interview. The same article states that an employer shall not ask applicants about their pay history. Under Article 7, employees can request information about their own pay level and the average pay levels, broken down by gender, for colleagues doing the same work or work of equal value, and the employer must answer within two months. Article 7 also requires member states to prohibit contract terms that stop employees from disclosing their pay.

The Danish draft follows this approach. PwC points out that the Equal Pay Act applies to all employers, and that an employer who fails to meet the transparency obligations may have to prove that no pay discrimination has taken place, unless the breach is obviously unintentional or minor. The directive allows member states to exempt employers with fewer than 50 workers from one specific obligation, namely making the criteria for pay progression available. It does not exempt them from the rules on recruitment or the right to information.

Practical Next Steps Before January 2027

The first step is to look at recruitment. Small businesses often hire informally, with pay agreed during a conversation and anchored to what the candidate earned before. That way of hiring will need to change. It makes sense to decide on a starting salary or a realistic range for each role before it is advertised, and to remove any question about current or previous salary from application forms, interview guides and recruiter briefs. If you use AI tools to draft job adverts or screen candidates, check that templates and screening questions follow the same principle, and that the pay information you publish is the one you have actually approved.

The second step is to write down how pay is set. The directive expects pay to be based on objective, gender-neutral criteria such as skills, effort, responsibility and working conditions. Many small companies have never described this. A short internal document that groups roles, explains how starting pay is set and describes what drives raises will make it much easier to answer an information request within two months, and to explain differences if they are questioned.

The third step is to review employment contracts and staff handbooks for confidentiality clauses that prevent employees from discussing their pay, since such terms are expected to be prohibited. At the same time, it is worth checking whether a collective agreement applies to some or all employees, because the directive also requires applicants to be informed of relevant collective agreement provisions where applicable.

Finally, companies approaching 100 employees should start checking the quality of their pay data now, including job titles and role classifications. Reporting is several years away for most smaller firms, but clean data takes time to build. Because the Danish law has not yet been passed, any business with specific questions about its obligations should get legal advice for its own situation once the final text is available.

Brenvard's perspective

These rules apply to Brenvard as an employer too. When we advertise roles on our careers page, the Danish law is expected to require a starting salary or range for each position, and questions about previous pay will be off the table. That means writing down how pay is set before we recruit, which is a discipline a growing company benefits from anyway. There is a trade-off: published ranges reduce some room for negotiation and make internal differences more visible, which calls for consistent decisions. On the other hand, clear pay information can make a small company more attractive to candidates who compare offers. For our work with other small employers, the same lesson applies: the effort lies less in the paperwork and more in agreeing the criteria behind pay.

A Measured Approach

The pay transparency rules are less about paperwork and more about making pay decisions that can be explained. For most small businesses, the work consists of clearer pay ranges, consistent criteria and updated templates, which can be done in stages over the coming months. Brenvard's people and talent services support smaller employers in putting pay structures and recruitment practices in order, so they are ready when the Danish law takes effect.

Sources

Ius Laboris – EU Pay Transparency Directive: which countries have transposed (30 September 2026)
PwC Danmark – Løngennemsigtighed 2026 (updated 10 September 2026)
Azets – Løngennemsigtighedsdirektivet: seneste nyt (11 August 2026)
Littler – Denmark’s Bill to Implement the EU Pay Transparency Directive Sent for Public Consultation (3 March 2026)
DLA Piper – Consultation launched on Danish bill for implementing the Gender Pay Transparency Directive (2026)
Finansforbundet – Gennemsigtighed om løn fra januar 2027 (2026)
EUR-Lex – Directive (EU) 2023/970 on pay transparency (2023)