Bulgaria enters draft law transposing the EU Pay Transparency Directive into Parliament

On 11 September 2026, the Bulgarian Council of Ministers submitted to the National Assembly a draft legislation for amendment and supplement of the Protection Against Discrimination Act, which transposes Directive (EU) 2023/970 into Bulgarian law. The transposition deadline set by the Directive was 7 June 2026. While Bulgaria missed the 7 June 2026 transposition deadline, it remains ahead of many other EU member states such as Austria, Belgium, Croatia, Germany, Hungary, Luxembourg, Slovenia and Sweden in the legislative process.

Considered materially improved compared to the version used for public consultations, the draft law includes many of the opinions submitted between 19 May and 18 June 2026. Improvements include:

• the main criteria for determining work of equal value have been aligned with Article 4 of the Directive and are defined as skills, effort, responsibility and working conditions;
• for temporary employees, compliance with pay transparency obligations is the burden of the undertaking rather than the temporary work agency;
• the pay confidentiality ban has been refined with a purpose limitation tied to the exercise of the right to equal pay; and
• the implementing ordinance will set out the methodology for pay-gap evaluation.

One of the most significant remaining concerns is the absence of a standalone definition of “pay”. The EU Pay Transparency Directive defines “pay” as the ordinary basic or minimum wage or salary and any other consideration, whether in cash or in kind, which a worker receives directly or indirectly (complementary or variable components) in respect of his or her employment from his or her employer. 

The draft law does not introduce this definition. It uses the terms “remuneration” and “labour remuneration”, which may be narrower in scope. Thus, certain components of remuneration could potentially fall outside the scope of the law’s transparency and reporting obligations. This was one of the concerns raised during the public consultation process. This gap, however, may be partially mitigated by the EU law principle of consistent interpretation. According to this principle, national courts and authorities are required to interpret domestic law in light of the wording and purpose of an applicable directive. Even in the absence of an express statutory definition of “pay” in Bulgarian law, courts and the Commission for Protection against Discrimination should be expected to construe the terms of the new law according to the Directive’s broader definition, encompassing all forms of remuneration received by workers in connection with employment.

Another concern raised in the public consultation is the draft law’s requirement that the criteria for evaluating work of equal value apply to setting an increase in individual remuneration. This approach was criticised during the public consultation. Some stakeholders argued that the criteria for assessing the value of work should be clearly distinguished from the criteria for justifying individual pay differences or increases within the same category of workers.  Factors such as individual performance, professional experience, qualifications, seniority and market conditions are legitimate and objective grounds for differentiated pay increases, yet they do not fit neatly within the four equal-value criteria. How this practice will develop remains to be seen. 

The law is expected to enter into force on the day of its promulgation in the State Gazette with the exception of the reporting obligations and the joint pay assessment mechanism, which will enter into force on 7 June 2027 for employers with 150 or more employees, and on 7 June 2031 for employers with 100 to 149 employees. 

This means that upon promulgation, new obligations will apply immediately to all employers, including obligations on: 

• gender-neutral job titles in vacancy announcements; 
• providing job applicants with information on the starting salary or its range;
• the prohibition on asking applicants about their pay history; 
• the right of employees to request and receive information on their individual pay and on average pay levels by gender for the category of workers performing equal or equivalent work; 
• the annual notification obligation by 31 January each year informing employees of their right to this information; 
• the transparency of criteria for determining and increasing pay; 
• the prohibition on pay confidentiality clauses for the purpose of exercising the right to equal pay. 

All pay transparency obligations apply to every employer regardless of size. (The Directive permits EU member states to exempt employers with fewer than 50 workers from the obligation to provide information on the criteria for pay increases, but the draft law does not introduce this exception). 

Within three months of the law’s promulgation, an ordinance setting out the methodology for evaluating the gender pay gap and the procedure for providing information must be adopted. This ordinance will be essential for the practical implementation of the reporting and joint-assessment obligations that enter into force in 2027.

For more information on the draft law transposing the EU Pay Transparency Directive and its impact on employers in Bulgaria, contact your CMS client partner or the CMS experts who contributed to this article.