Employee mobility under the influence of the EU 

This includes ensuring compliance with local labor laws, tax regulations and immigration requirements as well as future requirements by the EU. In particular employers should be aware of the Posted Workers Directive and its implications for global mobility, as well as paying attention to the incoming EU Directive on pay transparency. While the latter is still being specified through its implementation into national law, the Posted Workers Directive was launched in 1996 and has gained significance, particularly with the Enforcement Directive in 2014 and its update in 2018.  An increased focus on transparency and equal pay is also top of mind for employers with the pending EU Pay Transparency which will be transposed in to national law in June 2026.

The EU Posted Workers Directive is designed to protect the rights of workers who are temporarily posted by their employer to another EU member state. The key requirements of the Directive include:

Meanwhile, the EU Pay Transparency Directive aims to promote gender pay transparency and address the gender pay gap by requiring employers to provide information on pay levels and gender pay disparities. The Directive requires companies with 100 or more employees to disclose information on the gender pay gap, including average salaries and benefits, broken down by gender. It also prohibits employers from retaliating against employees who inquire about or disclose pay information. Additionally, the Directive encourages employers to conduct pay audits to identify and address any unjustified gender pay disparities. The goal of the Directive is to increase transparency, promote equal pay for equal work and empower employees to challenge pay discrimination. This Directive applies to all employees, including expatriates.

Transparency is important in mobility packages to build trust and fairness within the organization — while ensuring legal compliance. When employees have a clear understanding of their compensation and benefits, they feel valued and are more likely to be engaged and motivated. In Mercer’s 2024 Global Pay Transparency Survey, 59% of companies responded that pay transparency was an expectation of employees. Transparency also helps to mitigate the risk of misunderstandings or disputes regarding compensation, which can lead to dissatisfaction and potential legal issues.

Organizations need to proactively address these challenges and ensure compliance while also leveraging the opportunities for transparency and fairness in compensation practices.

To comply with current requirements based on the Posted Workers Directive  and to be prepared for the EU Pay Transparency Directive, organizations can take the following steps: