Originally published on 26 September 2023. Updated on 15 January 2026.
Spain has been one of the leaders in Europe in its approach to address gender equality, pay discrimination, and equal pay for equivalent work, now ubiquitous terms used in the diversity, fairness, and inclusion discussion. In 2020, Spain introduced two complementary Royal Decrees designed to address gender equality. Decree 901 regulates gender equality plans, and Decree 902 helps target gender discrimination in pay, and they apply today to any company with more than 50 employees. Both decrees seek to ensure equal treatment of and opportunities for employees. Companies who do not comply to the policies will receive financial penalties.
For some organizations, that level of transparency and accountability is new. Still, others that are EDGE Certified will recognize these as some of the fundamental principles underpinning the EDGE Standards, which means they are aligned with the Spanish Royal Decree requirements. EDGE Certification and the Spanish government’s approach share the same philosophy that analysis alone will not drive action; only a shared plan of action will accelerate the achievement of sustainable progress and drive change.
Enforcing Gender Equality
The Spanish government has been continuously tightening its gender equality regulations over time. Since January 2023, an amendment to the Public Sector Contracts Act, means that public sector bodies are prohibited to contract with any company with 50 or more employees that cannot evidence a gender equality plan; it is now a requisite part of any tendering process for government contracts. Moreover, new legislation in 2023 now mandates that equality plans also include measures to ensure non-discrimination for LGBTI persons, with companies over 50 employees. Through the EDGEplus (gender and intersectionality) Standard, organizations can analyze the intersectionality of gender with other aspects of diversity, including sexual orientation as well as gender identity, race and ethnicity, age, disability, and socio-economic background. EDGEplus enables organizations to tailor the assessment to their specific priorities, supporting compliance and providing a nuanced understanding of workplace fairness.
Enforcement has also intensified. Inspectors have begun to actively check for compliance and issue sanctions to companies without a registered plan. In fact, not having an equality plan is classified as a serious offense punishable by fines (which can reach up to EUR 225,000 in severe cases). The Spanish Labour Inspectorate’s strategic plan for 2025–2027 prioritizes verifying the real implementation of equality plans, with stepped-up inspections planned. The Spanish government’s strong signals and equally strong incentives, together with the requirement of employee representative involvement in equality plans and compensation registers, provide a unique way to address the gender equality topic.
Equal Pay Decree
The gender pay gap analysis approach in Spain covers specific measures for companies of all sizes to keep a pay register of all employees, including executives. The register should include average and median base salaries and extraordinary payments for one calendar-year period, broken down by gender and professional group, professional category, level, job position or any other applicable classification system. Companies must include an audit in the plan to ensure transparency and monitoring of the remuneration system.
Surprisingly, Spain’s pay gap threshold of 25% does not equate to the current identified average pay gap of the OECD (11%). Spain’s own gap is roughly 6%, far below the 25% threshold that Spanish law uses to trigger justifications. If the audit shows that average or median pay for one gender is at least 25% greater than the other, the salary record in the register must include an objective justification based on evidence that this disparity is not due to gender-related reasons. Notably, EDGE has long applied a stricter threshold for pay equity, namely an unexplained gap of 5% or more for employees doing equivalent work is flagged for action. This 5% tolerance—used within the EDGE Standards since their inception over a decade ago—reflects what is widely considered an acceptable maximum threshold in pay equity analysis today and mirrors the benchmark introduced by the EU Pay Transparency Directive.
A key transparency measure of the decree means that employees will have access to the statistical analysis (not the personal data of other workers) and any statement of justification. This will allow workers to bring actions before the employment courts to correct situations if there appears to be gender discrimination in pay.
That level of transparency holds companies accountable for change, an approach also integral to measuring pay equity within the EDGE Certification process. Companies undergoing EDGE Certification are assessed both on the unexplained gender pay gap, data that is subject to independent audit, but also on management practices to communicate on pay equity within the organization.
Looking ahead, the regulatory landscape is evolving to demand even greater rigour on pay equity. The European Union’s Pay Transparency Directive requires employers across the EU to strengthen pay transparency and take action where unjustified gender pay gaps are identified, with first reporting by large organizations beginning in 2027.
As of January 2026, Spain has not yet published draft legislation to transpose the directive into national law. EDGE Certified organizations operating in Spain are well-positioned for this shift, as the EDGE framework’s long-standing 5% equal-pay threshold and action-oriented methodology already anticipate these requirements. For additional context, see our article on the EU Pay Transparency Directive.
Equality Plan Decree
Under Spanish law, the pay equity analysis results along with accompanying action plans shall form part of the company equality plan. The plan shall be negotiated with workers’ representatives following specific collective bargaining regulations.
The decree outlines requirements for the equality plan in terms of key structural elements. These elements are consistent with those required of the action plans developed by EDGE Certifying organizations that work to continuously improve their performance against the EDGE Standards, namely:
- The equality plan shall sit at a strategic level within the organization, similarly to EDGE Action Plans, which are signed off by executive management.
- The equality plan provides a description of specific measures, execution period, as well as design of indicators that allow determining the evolution of each measure, the same requirements as an EDGE Action Plan.
- Under both the EDGE Certification and Royal Decree requirements, actions shall be supported by adequate and appropriate means and resources, both material and human, necessary for the implementation, monitoring, and evaluation of each of the measures and objectives.
- Both the equality plan and the EDGE Action Plan require measurable milestones in the form of outcomes that must be monitored for implementation or achieved within specific timeframes. For each measurable milestone, EDGE Certification clients specify how the action is expected to improve the performance against the EDGE Standards.
Comfort for EDGE Certified Organizations in Spain
The underlying principles of accountability and transparency underpin both the gender equality approach of the Spanish government and EDGE Certification, two strong drivers of real change within organizations on this strategic topic. At the same time, EDGE Certification enables organizations to pursue a more ambitious and holistic approach to workplace fairness and inclusion. This is achieved through the unique triangulation of three sources of information—organizational statistics, an assessment of policies and practices, and employee perceptions—across the four pillars of the EDGE Methodology.
With EDGE Certification, organizations are audited every two years against a recognized international standards framework, supporting continuous monitoring and enabling workplace fairness to be embedded into broader talent management, leadership, and organizational strategy. Where actions are likely to take longer than a two-year certification cycle to complete, progress is audited and assessed to keep progress on track, just as the Royal Decree expects the monitoring, evaluation, and periodic review of the equality plan. This consistency of gender equality approach, therefore, offers strong comfort to EDGE Certified organizations and their leadership, operating in the Spanish market.
