How pay transparency changes salary negotiation

With pay transparency laws being rolled out across Europe, salary ranges are now more common in job postings. And this fundamentally changes the negotiation dynamic between employers and candidates. Instead of the traditional dance where candidates tried to find out salary information while employers played their cards close to their chest, the compensation framework is clear before the conversation starts.

This change doesn’t eliminate salary negotiations: it fundamentally transforms them. When candidates already know you’re offering €50,000-€70,000 before they apply, the conversation moves from “what does this pay?” to “where do I fit within this range and why?” This means you must completely rethink your negotiation strategies, internal equity considerations, and how to remain flexible while being transparent. It also means you must re-educate everyone involved in these negotiations. Let’s look at the most pressing questions I’ve received about salary negotiations and pay transparency.

If we publish salary ranges, won’t every candidate ask for the top of the range?

This is the question I most often receive, but the reality is more nuanced. Yes, many candidates will initially anchor to the top of your range. That’s basic negotiation psychology: everyone thinks they are the best and most qualified! It means you must be able to explain how salary is determined within that range. During the interview, clearly articulate what differentiates the four quartiles of the range. What does it mean to be placed in the bottom or top quartile? Is it years of experience? Specific skills or certifications? Track record or results? When candidates understand the criteria, they can self-assess more realistically. The key to having a good conversation is having clear, easy explainable criteria for where a candidate lands within your posted range.

What if an employee sees a range that is higher than what they’re currently making?

I hope you’ll do everything to avoid this. Your pay transparency efforts must first be focused on internal employees – and you still have enough time to do so. Do not post ranges externally before you’ve disclosed them internally, and employees understand in which level and quartile they are placed. Including remediation plans if required. When employees can see external salary ranges, pay disparities become impossible to ignore. The solution is to proactively audit, and address pay gaps before they become a public relations nightmare. Start by analyzing your employees’ salaries against the ranges you’ve defined. If you discover significant gaps, develop a budget and timeline for bringing people up to market rates. Communication is crucial here: explain to your people that you’re using transparency as an opportunity to ensure everyone is fairly compensated. Most employees appreciate honesty about the process, even if corrections take time to implement across budget cycles. Once the internal project is completed you can publish external ranges.

How do we train our hiring managers to negotiate effectively?

This is a fundamental shift for hiring managers who have salary conversations. Instead of training them to negotiate individual packages, teach them to confidently explain your compensation philosophy and range criteria. They need to become skilled at articulating why someone might land at different points within your range based on objective factors. Role-play scenarios where candidates expect the top of the range, and practice responses that redirect the conversation to quartiles, fit and value creation. Most importantly, hiring managers must understand your internal equity guidelines: they need to know what flexibility they have and what requires additional approval. Consider creating simple scripts or talking points that help them navigate these conversations consistently while maintaining your company’s transparency commitments.

Can we still negotiate non-salary benefits and perks?

In the EU, salary transparency requirements focus on base pay ranges and on total compensation. You can still negotiate flexible work arrangements, professional development budgets, additional vacation days, equity participation, bonus structures, or unique perks that matter to specific candidates. In fact, many candidates increasingly value these elements as much as base salary and here you can personalize the offer. The key is being transparent about what’s negotiable and what isn’t. Create clear guidelines about which benefits can be customized and which are standard for all employees in similar roles. This approach maintains equity while giving you tools to close candidates who might be at the lower end of your salary range but highly value other forms of compensation. But no matter the personal selection, always make sure that you give an equal amount of benefits and perks to employees doing equal work.

Can we still create an exception if a perfect candidate wants more than our range?

It is important that you set clear policies before this happens. Keep in mind that paying above your posted range undermines trust and can create legal risks. If candidates applied based on your stated range, paying significantly more could be seen as misleading. In addition, why did a candidate apply when they already knew the top of your range was below their expectations?

But you might run into a scenario where an adjustment makes sense: if market conditions have shifted dramatically since you shared the range, if the candidate brings unusually valuable skills (often meaning they are actually in a higher level), or if you’re competing for rare talent (e.g. add a well-defined market allowance). Make sure you have a documented process for exceptions that includes who must approve them and how you can justify them in objective requirements. You also want to create a schedule to align your salary ranges to the market reality. Whenever you make an exception, carefully consider if it’s really an exception, or if you need to adjust the range for future postings and review compensation for current employees in similar roles. And note that in this case, an exception must truly be an exception, otherwise you’re just circumventing your pay transparency policy.

How do we negotiate with candidates who use a competitors’ salary data?

Yes, the world will be full of informed candidates! Here’s where pay transparency levels the playing field. Instead of getting defensive, use this as an opportunity to have an honest conversation about total compensation and value proposition. If a candidate says “Company X is offering €10,000 more,” you can respond with facts: “Let’s look at the complete package including our bonus structure, benefits, and growth opportunities.” Sometimes you’ll find that your total compensation or workplace culture provides value that justifies your positioning. Other times, you’ll discover you genuinely need to adjust your ranges to stay competitive, and that’s valuable market intelligence. The key is being prepared with clear data about why your offer is competitive and what unique value your organization provides beyond base salary. And yes, sometimes it means that candidates will accept the highest possible offer from a competitor. But this has always been the case– it’s just that you now know the number.