Gender inequality in the labor market is a persistent issue in the European Union member states, including Croatia. Gender pay gap is one of the key indicators of inequality between men and women in the labor market. The gender pay gap arises due to a multitude of complex and interconnected factors, requiring a multidimensional approach to address the core issue of unequal pay between men and women. Being equally paid for equal work or work of equal value is a fundamental right recognized by the EU as early as 1959 in Article 119 of the Treaty establishing the European Economic Community (1957). Therefore, the mere fact that the issue of unequal pay between men and women was recognized long ago but remains relevant indicates the problematic nature and sensitivity of this issue. In order to improve the implementation of the principle of equal pay for equal work or work of equal value and to combat the gender pay gap, the EU adopted a new Directive on pay transparency on May 10, 2023, the full title of which is "Directive of the European Parliament and of the Council to strengthen the application of the principle of equal pay for equal work or work of equal value between men and women through pay transparency and enforcement mechanisms". The fundamental research question of this paper is to determine whether the measures envisaged by the new Directive are sufficient to fully eliminate the gender pay gap, while simultaneously exploring possible challenges in the implementation of pay transparency measures. The first part of the paper analyzes the concept of the gender pay gap and pay discrimination, highlighting the difference between the terms "gender pay gap" and "pay discrimination." Furthermore, the second chapter provides a brief overview of the regulation of the right to equal pay for equal work or work of equal value at the international, European, and national levels. The third part of the paper presents statistical indicators of the gender pay gap at the European and national levels. Additionally, this chapter will address the challenges that the COVID-19 pandemic has caused in terms of gender equality in the labor market and the significant issue of the gender pay gap in pensions, which arises as a result of the gender pay gap. The fifth chapter deals with a comparative analysis of legislative solutions regarding pay transparency in several EU countries, which have served as examples of good practice for the adoption of the aforementioned Directive on pay transparency. In the sixth chapter, by presenting the legislative framework of the Republic of Croatia, an attempt is made to answer the question of whether pay transparency currently exists in Croatia. The seventh chapter is dedicated to the analysis of the provisions of the new Directive on pay transparency, aimed at increasing pay transparency and establishing measures to improve access to justice for victims of pay discrimination. In the eighth, and final, chapter, the fundamental research question of the paper is answered - whether the Directive on pay transparency can fully eliminate the gender pay gap.