Gender Pay Gap Reporting — Who, When and What Must Be Reported (2027–2031)

Why Gender Pay Gap Reporting Is Mandatory

Article 9 of Directive (EU) 2023/970 on pay transparency introduces an unprecedented obligation for employers across the European Union: periodic reporting on the gender pay gap through 7 standardised indicators.

The purpose is twofold. First — transparency: data for indicators 1–6 becomes public, visible to employees, candidates, media, and investors alike. Second — accountability: if indicator 7 reveals an unjustified gap exceeding 5% in any category of workers, an escalation mechanism with specific deadlines and consequences is triggered.

In Bulgaria, the obligation is transposed through the Draft Amendment Act (ZID) to the Protection Against Discrimination Act, which sets the first reports to be filed by 7 June 2027 (Art. 14a(1)(1) ZID).

Who Must Report and When

The reporting obligation depends on the number of employees in the organisation. Important: all employees are counted, not just full-time equivalents (FTE). Every person with an employment contract is included in the calculation.

In practice: if you have 250 employees, from 2027 onwards you will file a report every year. If you have 180 — you file by June 2027 and the next report is due by June 2030. If you have 120 — your first deadline is June 2031, but preparation should start well in advance.

Even if you have fewer than 100 employees, the obligations regarding pay transparency in recruitment (salary range in job postings, prohibition on asking about previous salary) apply to all employers.

The 7 Mandatory Indicators — What They Measure

Article 9(1) of the Directive defines exactly seven indicators that every report must contain. Here is what each one measures:

1. Mean gender pay gap — measures the percentage difference between the average pay of men and the average pay of women in the organisation. Provides an overall picture but can be skewed by extreme values.
2. Mean gap in supplementary/variable components — measures the difference in average values of bonuses, premiums, overtime pay, and other supplementary pay components between men and women.
3. Median gender pay gap — measures the difference between the median pay of men and the median pay of women. The median is more resistant to extreme values and gives a more realistic picture of the typical employee.
4. Median gap in supplementary components — measures the median difference in bonuses and supplementary components between genders. Again — a more robust measure than the mean.
5. Proportion of women and men receiving supplementary components — measures what percentage of women and what percentage of men in the organisation receive bonuses, premiums, and other supplementary components. Reveals whether access to additional pay is equal.
6. Proportion of women and men in each pay quartile — distributes all employees into 4 quartiles (Q1–Q4) by pay level and shows the share of women and men in each quartile. Reveals “glass ceilings” — whether women are concentrated in lower quartiles.
7. Pay gap by category of workers — the most complex indicator. Measures the pay gap between men and women within each individual category of workers performing equal or equal-value work. Broken down into basic pay + supplementary components separately.

Indicator 7 is the key one. It is the one that triggers the 5% threshold (Art. 10 of the Directive). To calculate it correctly, you must first define the categories of workers — and that requires a job grading system (job classification).

What Counts as “Pay”

The definition of “pay” under Art. 3(1)(b) of the Directive is extremely broad. Reporting covers gross annual AND gross hourly pay — i.e., calculations are made both ways.

“Pay” includes everything the worker receives from the employer, directly or indirectly:

• Basic salary — fixed monthly/annual gross pay
• Bonuses — annual, quarterly, one-off
• Premiums — for performance, sales, project completion
• Overtime pay — compensation for work beyond standard hours
• Night work and public holiday pay — additional remuneration under the Labour Code
• Allowances — for transport, meals, clothing
• Benefits in kind — company car, housing, insurance, meal vouchers

In the Bulgarian context, supplementary components are regulated under Art. 13 of the Ordinance on the Structure and Organisation of Wages (NSORZ) and include: additional remuneration for length of service and professional experience, night work, overtime, public holidays, higher personal qualifications, profit-sharing, and more.

For the tax treatment of different compensation components, see our analysis of taxes and social security in Bulgaria. For questions related to dividends and liquidation shares — these are NOT included in “pay” under the Directive, as they do not arise from an employment relationship.

To Whom Is the Report Filed and Is It Published

Not all indicators go to the same recipient. Article 9(2)–(4) of the Directive makes a clear distinction:

Key distinction: indicators 1–6 become public knowledge. Job candidates, competitors, media, and investors will be able to see your data. Indicator 7, however, is internal — provided to employees and their representatives, and to EA GLI only upon request. But it is precisely indicator 7 that triggers the Art. 10 mechanism.

The 5% Threshold — What Happens Step by Step

Article 10 of the Directive creates an escalation mechanism triggered when indicator 7 reveals a gap of 5% or more in any category of workers. Here are the four steps:

1. Step 1 — Reporting: The report reveals a ≥5% pay gap in a given category of workers.
2. Step 2 — Justification: The employer must justify the gap using objective, gender-neutral criteria. If the employer can demonstrate that the gap is due to legitimate factors (experience, qualifications, market conditions) — the procedure stops here.
3. Step 3 — Correction within 6 months: If the employer cannot justify the gap, it must be corrected within 6 months.
4. Step 4 — Joint assessment: If the gap remains unjustified, the employer must conduct a joint pay assessment together with worker representatives.

The 7 Elements of the Joint Assessment

The joint assessment under Art. 10(3) includes:

1. Analysis of the proportion of women and men in each category of workers
2. Average pay levels by gender for each category
3. Pay differences for each category
4. Reasons for the differences — established jointly by the employer and worker representatives
5. Proportion of women and men who received a pay increase after returning from parental leave
6. Measures to address unjustified gaps
7. Evaluation of the effectiveness of previous measures (if any)

Practical Challenges

Reporting under Art. 9 sounds systematic, but practical implementation is considerably more complex than it appears. Here are the main challenges:

• “Category of workers” ≠ job description. The Directive defines “category” as workers performing equal or equal-value work. This requires job grading (job classification) — a formal system that groups positions by complexity, responsibility, and requirements. Without job grading, indicator 7 is impossible to calculate. See our guide to job grading.
• Collecting data on supplementary components. Bonuses, premiums, and benefits in kind are rarely structured in a single file. They may be scattered across payroll systems, HR platforms, board decisions, and even informal arrangements. Coordination between HR and accounting is critical.
• Quartile calculation. For indicator 6, you must sort ALL employees by pay level and distribute them into four equal groups. For companies with atypical structures (many part-time or seasonal workers), this can be non-trivial.
• Historical data. The first report will cover data for the previous year. If you have not been keeping detailed gender-disaggregated statistics for all components until now, retrospective data collection is a significant challenge.
• Cross-departmental coordination. Reporting requires collaboration between HR (employee data), accounting (payroll and bonuses), IT (data export), and legal (compliance). Without clear allocation of responsibilities, the process stalls.

Each of these challenges can be overcome with proper preparation — and the earlier you start, the smoother the first report will be. For a comprehensive employment law and compliance strategy, contact us.

Why Prepare NOW (Not in 2027)

The first report for companies with 250+ and 150–249 employees is due by 7 June 2027. That sounds far away, but here is the realistic preparation timeline:

Total: 12–14 months from start to filing. If you start today, you just fit the deadline. If you postpone until autumn, you risk filing an inaccurate report or missing the deadline entirely.

For companies with 100–149 employees: your deadline is 2031, but that does not mean you should wait. Implementing a job grading system and data collection processes is an investment that improves compensation management and reduces legal risk from equal pay claims well before the formal deadline.

Frequently Asked Questions