Employees Don’t Leave Only for Money — They Leave for Clarity
In working with a wide range of organisations and speaking with job seekers daily, we have come to a clear conclusion: employees do not leave only for higher pay. More often, they leave because they lack clarity. Employees are uncertain about where they stand within the organisation, how their salary is determined, and what it takes to progress.
In Cyprus, this challenge is particularly visible. Larger and international organisations often attract talent away from smaller businesses not only through higher salaries, but through structure: clearly defined roles, transparent pay frameworks, and visible career paths. These elements create confidence and direction and can significantly strengthen the ability to attract and retain talent.
And in many cases, the lack of clarity does not just create uncertainty. It can also mask underlying pay inequalities, including unexplained differences between men and women in comparable roles. Across Europe, the absence of transparency has contributed to persistent gender pay gaps, many of which remain unexplained or unjustified. Pay transparency is therefore not just about organisational clarity — it is fundamentally about fairness and equal treatment.
A Directive That Changes the Conversation
This is where the EU Pay Transparency Directive (EU) 2023/970 has the potential to be a true turning point. While its primary objective is to address persistent gender pay gaps across the EU, its broader impact is far more transformative: it encourages organisations to fundamentally rethink how they define roles, assess value, set pay, and communicate career progression.
The Directive requires employers to introduce greater transparency in pay structures and recruitment processes. Employers will be required to provide salary ranges before interviews or at early stages of recruitment, refrain from asking questions about candidates’ previous salary history, inform employees about their pay level and progression criteria, and disclose average pay levels by gender for comparable roles.
Importantly, the Directive reinforces the concept of equal pay for work of equal value. This means organisations must assess roles based on objective criteria such as skills, effort, responsibility, and working conditions — not job titles alone.
The Gender Pay Gap: From Awareness to Accountability
One of the most significant changes introduced by the Directive is the move from voluntary awareness to measurable accountability.
Employers, particularly larger organisations with more than 100 employees, will be subject to regular gender pay gap reporting obligations, including reporting differences in pay and variable compensation by gender.
Where a gender pay gap of 5% or more is identified and cannot be justified by objective, gender-neutral factors, employers will be required to take corrective measures. This may include conducting a joint pay assessment in cooperation with employee representatives.
For many organisations, this will require a detailed review of existing pay practices to determine whether differences are driven by legitimate factors such as experience, performance, or qualifications, or by legacy structures and inconsistent decision-making.
Why Structure Is Now Essential
These requirements send a clear message: informal or ad-hoc salary decisions will no longer be sufficient. Instead, organisations will need to develop structured and transparent compensation frameworks that include clearly defined roles and responsibilities, formal job grading or levels, transparent salary bands, and documented criteria for pay progression and promotions.
When these elements are in place, employees gain a much clearer understanding of where they stand in their position within the organisation, what the next career step looks like, what skills or responsibilities are required to progress, and how their compensation may evolve over time. This level of transparency can significantly improve engagement, strengthen retention, and ultimately enhance overall organisational performance.
The Timeline: June 2026 Is Approaching
Preparation is key. EU Member States are required to transpose the Directive into national law by 7 June 2026, and Cyprus is currently preparing a draft legislation to ensure alignment.
With the implementation deadline approaching, organisations should start preparing now. Building transparent structures and aligning internal processes takes time. Companies should start by reviewing current pay structures to identify inconsistencies, clearly defining roles and responsibilities, establishing structured job levels, developing salary bands consistent with market benchmarks, clarifying progression criteria, and preparing for gender pay gap reporting obligations.
The path forward is becoming clearer, and for organisations willing to embrace it, it presents a significant competitive advantage.
Need support reviewing remuneration practices and preparing for the upcoming transparency requirements? Contact us today to find out how we can help.
Andia Taliadorou
Junior HR Analyst at C.Y Actuaries
The views expressed above are solely of the author and do not necessarily represent the views of Cronje & Yiannas Actuaries and Consultants Ltd
