Four main changes:
- Disclosure of salary range: Employers must provide candidates with the expected salary or salary range in writing before the first job interview.
- Ban on asking about previous salary: It will no longer be allowed in the recruitment process to ask candidates about their previous salary.
- Right to discuss salary: Employers may not prohibit employees from discussing their own income.
- Principle of equal pay: The Employment Contracts Act will state more clearly that women and men must receive equal pay for equal or equivalent work.
Going forward, employers must disclose the expected salary or salary range in writing to job applicants before the first interview. The aim is to allow candidates to prepare for salary negotiations and, if they wish, withdraw from the recruitment process. The changes also save time for both employers and candidates if salary expectations do not align.
According to the minister of economy and industry Erkki Keldo, salary is one of the most important factors in choosing a job, and people must be able to make informed decisions at the start of the recruitment process. “Earlier disclosure of salary information and greater transparency help reduce unjustified pay differences and create a fairer labour market,” Keldo added.
The adopted amendments also clarify the prohibition on asking about a candidate’s previous or current salary. The aim is to avoid situations where a person’s previous pay unjustifiably influences their future salary and employment conditions.
In addition, the Employment Contracts Act introduces an obligation for employers to ensure equal pay for equal or equivalent work for women and men. This principle has already been established in the Gender Equality Act since 2004. This means that employers must pay equal wages for the same or equivalent work, except where there are objective and gender-neutral reasons for differences in pay.
The law also introduces the 'Pay Mirror' (Palgapeegel), designed to help employers voluntarily analyse the gender pay gap in their organisation, thereby increasing awareness and supporting the development and implementation of fair pay systems.
According to Keldo, pay disparities are often not the result of intentional discrimination, but rather a lack of sufficient analysis and awareness. “Pay Mirror is designed to give managers a convenient and automated way to assess their organisation’s pay systems and identify potential issues early on,” the minister added.
Pay Mirror shows whether and to what extent a gender pay gap exists within an organisation. The application provides an overview of gender equality in the organisation, allows monitoring of the gender pay gap, average and median salaries, as well as the gender distribution of employees across different roles.
Employers will also have access to a voluntary job evaluation methodology and tool. In addition, free training for job evaluation and the development of pay structures will be offered to employers during 2026 through the PALK project.
