The EU’s Pay Transparency Directive is on track to arrive in the next few months with a simple promise: visibility will bring fairness. But transparency only exposes outcomes; it doesn’t fix the systems that produce them.
Across sectors, pay is regularly shaped by negotiation, managerial discretion, counteroffers and informal market adjustments. These processes typically reward confidence, power and bargaining, while decades of evidence prove they penalise women and minorities.
Releasing salary ranges without addressing such biases won’t just fail to close gaps. It will expose inequalities, erode trust and damage retention of the talent you need most. Here’s how to stop that from happening.
Negotiation as a structural tax
The problem with negotiation-based pay isn’t simply that some people are better at it than others. It’s that the traits required to negotiate successfully have little to do with job performance and often more to do with stereotypes.
Research consistently shows that women are less likely to negotiate pay than men. On its own, this is concerning, but research shows it’s driven by a deeper double bind.
Women who negotiate trigger backlash, from both males and females, because it’s seen to “violate gender norms”. In anticipation of this backlash, they adjust their behaviour by either avoiding negotiating or using fewer assertive tactics. Both of which lead to lower salaries, with women earning between 16-23% less than men globally.
This creates a catch-22: women who aren’t assertive enough don’t get their desired outcomes, but women who are too assertive risk damaging their reputation. The same can be said for minorities. Black job seekers face lower salary outcomes when biased evaluators believe they’ve negotiated “too much”. Neurodivergent workers struggle with the ambiguous social rituals around negotiation due to processes that favour neurotypical communication.
This compounds over time. When someone starts at a lower salary because they didn’t negotiate, they get smaller percentage raises and reduced lifetime earnings. Inequality becomes institutionalised.
Eroding trust
Transparency makes this visible, which is valuable. It empowers employees who can be a force for good. Yet transparency also brings scrutiny. If HR’s answers to employee pushback are vague or subjective, transparency hasn’t solved the problem; it’s simply documented it. Employees see pay gaps exist, see inequality being acknowledged, but without seeing structural change, they lose trust.
What happens when you remove negotiation entirely
Some companies are experimenting with a different approach: removing negotiation from the pay system altogether. At 360Learning, we made that choice five years ago when we introduced full salary transparency.
We audited what we had to see how deep and far pay variations spread. We used this data to define eight clear levels for every role based on objective criteria, from scope of work to decision-making authority and role complexity.
Before hiring begins, we define levels for each role and publish the salary ranges attached to them, benchmarked to the 60th percentile of the tech market.
When we assess a candidate, we assign their level before making an offer and share both the level and salary range. Once they join, that level is visible to all employees. The same goes for raises. They are determined through a structured framework based on role, level, performance and where someone sits within their salary range. The outcome is transparent and formula-driven.
The result is simple: negotiation disappears because it is no longer necessary. Everyone understands how pay decisions are made and trusts that the system is applied consistently. Since implementing this approach, we have achieved 98.4% salary positioning for women and 97.4% for men, not by encouraging people to negotiate harder, but by removing the conditions where bias can creep in.
A step forward
We wholeheartedly believe in pay transparency and what the EU Directive is trying to achieve. It’s about time companies became more open on salary ranges and gender pay gaps and this is a step in the right direction.
Transparency shines a light on inequality. The real question is whether companies are ready to change the systems that create it.
Passionate about people, performance and potential, Sidonie studied at SKEMA Business School before embarking on her HR career, navigating the dynamic intersection of talent, strategy and business growth at world-leading brands including Celine, Sony, Saint Laurent and Estee Lauder. She made the jump to the tech industry first at crypto safety platform Ledger, then workplace meal experience company Foodles, before joining 360Learning in 2024.
