The European Parliament approved the Commission’s proposal on the transparency of remuneration which, after the final adoption by the Council of the EU, will ensure the effective implementation of equal pay for men and women, introducing greater transparency in the determination of compensation and improving access to justice for those who have suffered pay discrimination.
The legislative proposal focuses on two key elements of equal pay: measures to ensure pay transparency for workers and employers, and better access to justice for victims of pay discrimination.
Measures for wage transparency:
- Pay transparency for jobseekers - Employers should provide information on the level - or interval - of initial pay in the vacancy announcement or before the job interview. Employers will not be allowed to ask prospective workers for information on previous earnings.
- Right to information for employees - Workers will have the right to ask their employer about their individual wage level and average wage levels, broken down by sex, for categories of workers performing the same work or work of equal value.
- Gender Pay Gap Reports - Employers with at least 250 employees must make public within their organisation information about the pay gap between workers. For internal purposes, they should also provide information on the pay gap between female and male employees for categories of workers performing the same work or work of equal value.
- Joint assessment of wages and salaries - If the remuneration report reveals a gender pay gap of at least 5 % and if the employer is not able to justify the gender-neutral objective factors, the employers will have to carry out an assessment of wages, in cooperation with the employees' representatives.
Better access to justice for victims of pay discrimination:
- Compensation for workers - Workers who have suffered gender-based pay discrimination may receive compensation, including full recovery of outstanding pay and related premiums or payments in kind.
- Burden of proof on the employer - It will automatically be up to the employer, not the employee, to prove that there has been no discrimination in pay.
- Sanctions, including fines - Member States should introduce specific sanctions for violations of the equal pay rule, including a minimum level of fines.
- Equality bodies and workers' representatives may take legal or administrative proceedings on behalf of workers and take collective action on equal pay.
The proposal takes into account the current difficult situation of employers, particularly in the private sector, and maintains the proportionality of the measures, while offering flexibility to small and medium-sized enterprises (SMEs) and encouraging Member States to use available resources for reporting. The annual cost of wage reporting for employers is estimated at between 379 and 890 euros for enterprises with more than 250 employees.