Part 3: Objective, Gender-Neutral and Bias-Free through Pay Transparency

This is Part 3 of a four-part series examining Malta’s Equal Pay (Transparency and Reporting) Regulations , 2026. In this instalment, we examine the gender pay gap reporting obligations introduced under Part III, including the preparation and publication of Pay Gap Reports, the disclosure of gender pay information, and the circumstances in which employers are required to conduct a joint pay assessment.

Understanding the Gender Pay Gap Reporting Framework

Part III’s provisions require employers to collect, analyse and disclose information relating to gender pay differences within their workforce. The objective is not simply to expose pay disparities but to encourage employers to identify unjustified differences, explain them using objective and gender-neutral criteria where possible, and remedy those differences where no lawful justification exists.

Which Employers must report?

The laws recognise that employers of different sizes may require varying implementation periods. Article 9 introduces the obligation for employers employing at least one hundred (100) workers to prepare a Pay Gap Report.

• Employers employing two hundred and fifty workers (250) or more are required to submit their first Pay Gap Report by 7 June 2027, covering the period from 1 January 2026 to 31 December 2026. Thereafter, these employers are required to report annually.
• The law establishes a different reporting cycle for employers employing between one hundred and fifty (150) and two hundred and forty-nine (249) workers. These employers must also submit their first report by 7 June 2027 in respect of the 2026 calendar year, but subsequent reports are required every three (3) years.
• Article 9(4) provides a longer transitional period for employers employing between one hundred (100) and one hundred and forty-nine (149) workers. These employers are required to submit their first report by 7 June 2031 covering the 2030 calendar year and thereafter every three (3) years.

Therefore:

1. From 100-149 employees = Deadline is 7th June 2031 for 2030 calendar year, and thereafter every three (3 years);
2. From 150-249 employees = Deadline is 7th June 2027 for the 2026 calendar year, and thereafter, every three (3) years;
3. 250 or more employees = Deadline is 7th June 2027 for the 2026 calendar year, and thereafter report annually.

What must the Pay Gap Report contain?

Article 9(1) specifies the information that must be included in every report.

1. Employers are required to calculate the overall gender pay gap together with the gender pay gap relating to complementary or variable components of remuneration.
2. The report must also include the median gender pay gap and the median gender pay gap relating to complementary or variable remuneration.

Employers must also report:

• the proportion of female and male workers receiving complementary or variable remuneration;
• the distribution of female and male workers across each pay quartile; and
• the gender pay gap within each category of workers, distinguishing between ordinary basic salary or wage and complementary or variable remuneration.

These reporting requirements are intended to provide a comprehensive picture of remuneration practices rather than focusing solely on average earnings.

Employers are required to submit the relevant reports within fourteen (14) working days from the end of the relevant yearly reporting period. However the law allows employers employing fewer than one hundred (100) workers to provide the required information voluntarily, as no mandatory reporting obligation is imposed upon them.

Transparency heightened

This section also introduce important safeguards regarding the preparation and verification of the pay gap report. Article 9(7) requires the employer’s management to confirm the accuracy of the information following consultation with employees’ representatives. Significantly, employees’ representatives are entitled to have access to the methodologies applied by the employer when compiling the report. This requirement reinforces the principle of transparency by enabling representatives to understand how the calculations were performed and to scrutinise the methodology where appropriate.

Once completed, the Pay Gap Report must be communicated to the Monitoring Body, in accordance with article 9(8), using the format prescribed by that body. The same provision also permits employers to publish certain elements of the report, including the overall gender pay gap, bonus-related pay gaps, median pay gaps and pay quartile information, on their website or by other means.

The detailed information concerning pay differences within categories of workers is treated differently. Article 9(9) requires employers to provide this information directly to all workers and to employees’ representatives, while the Monitoring Body and the Equality Body may request access to this information where necessary. The same provision also requires employers, where available, to provide equivalent information covering the previous four (4) years.

Transparency under this section extends beyond the publication of statistical information. Article 9(10) grants workers, employees’ representatives, the Monitoring Body and the Equality Body the right to request additional clarification regarding any data contained within the report. This includes requesting explanations for identified gender pay differences.

Employers are required to provide a substantiated response within a reasonable period. Where differences cannot be objectively justified using objective and gender-neutral criteria in accordance with Article 3, employers are expected to remedy those differences within a reasonable time following consultation with the Monitoring Body, which may also consult employees’ representatives and the Equality Body where appropriate.

What about the Joint Pay Assessment obligation?

Part III also establishes circumstances in which reporting alone is insufficient. Article 10 introduces the concept of a mandatory joint pay assessment. Under Article 10(1), employers subject to the reporting obligations must conduct such an assessment where three (3) cumulative conditions are satisfied.

1. First, the Pay Gap Report must demonstrate an average pay difference of at least five (5%) per cent between female and male workers within any category of workers.
2. Secondly, the employer must have failed to justify that difference on the basis of objective and gender-neutral criteria.
3. Thirdly, the employer must not have remedied the unjustified difference within six (6) months from the submission of the Pay Gap Report. Only where all three (3) conditions are satisfied does the obligation to conduct a joint pay assessment arise.

What does the Joint Pay Assessment include?

Article 10(2) prescribes the contents of the joint pay assessment. The assessment is intended to identify, remedy and prevent unjustified differences in pay between female and male workers. It must contain:

1. an analysis of the proportion of female and male workers within each category of workers; together with
2. information regarding average pay levels and complementary or variable remuneration.

The assessment must identify;

• any differences in average pay;
• examine the reasons for those differences by reference to objective and gender-neutral criteria where applicable; and
• consider the proportion of workers whose remuneration improved following their return from maternity leave, paternity leave, parental leave or carers’ leave where relevant.

The assessment must also identify measures designed to eliminate unjustified differences and evaluate the effectiveness of any measures implemented following previous joint pay assessments.

Obligations post assessment

This section goes on to establish procedural obligations following completion of the assessment. Article 10(3) requires employers to make the joint pay assessment available to workers and employees’ representatives. Within ten (10) working days of completing the assessment, the employer must communicate it to the Monitoring Body and make it immediately available to the Equality Body upon request.

Article 10(4) requires employers to implement measures arising from the assessment within a timeframe agreed with employees’ representatives. The implementation process must include a review of any existing gender-neutral job evaluation and classification systems or, where none exist, the establishment of such systems to eliminate direct or indirect discrimination in remuneration.

Dispute Resolution

The law furthermore provide a mechanism for resolving disputes concerning either the conduct of the joint pay assessment or the implementation of corrective measures. Either the employer, employees’ representatives or the recognised union can request the Monitoring Body to participate in a conciliation meeting. Should conciliation fail to resolve the dispute, the matter may be referred to the Tribunal in accordance with Article 30(1) of the Main Act (Chapter 452 of the Laws of Malta). Article 10(6) further provides a right of appeal to the Court of Appeal for any party aggrieved by a decision of the Tribunal.

Overall, Part III of the Regulations requires employers to:

1. undertake proactive monitoring of their remuneration practices;
2. disclose meaningful pay gap information;
3. engage with employees’ representatives; and
4. where unjustified disparities are identified, implement corrective measures through a structured process of joint assessment and review. The reporting obligations and joint pay assessment mechanism are intended to foster greater accountability, encourage objective remuneration systems and ultimately contribute to the effective implementation of the principle of equal pay for equal work or work of equal value.

In Part 4, we will examine the enforcement and compliance framework established by the Articles, including the role of the Monitoring Body and the Equality Body, the remedies available to workers and sanctions for non-compliance.

How Can AE Help

Malta’s new Equal Pay (Transparency and Reporting) Regulations, 2026 introduce significant obligations for employers relating to gender pay gap reporting, pay transparency, and ongoing equal pay compliance. Employers must prepare for new reporting deadlines, assess pay disparities using objective and gender-neutral criteria, and, where required, undertake joint pay assessments and implement corrective measures.

AE supports employers in reviewing remuneration structures, preparing compliant Pay Gap Reports, establishing transparent and objective pay practices, conducting pay equity assessments, and implementing practical measures to meet the new legal requirements.

Get in touch with AE to discuss how these new reporting and compliance obligations may impact your organisation.