Salary transparency policy: equal pay for equal work

An overview of the salary transparency policy

‍

Die 2021 from European Parliament The adopted salary transparency directive aims to close the gender pay gap and promote greater equality in the workplace.

‍

Die Disclosure of pay structures is intended to uncover and eliminate unfair wage disparities. This is not only about transparency, but also about creating fairer working conditions for all.
‍

National authorities monitor compliance with the Directive and sanction violations. A decisive element is the individual right to information, through which employees can actively obtain information on salaries.

‍

Measures to address the gender pay gap

‍

The wage transparency directive aims to reduce the gender pay gap through concrete measures. One focus is on the introduction of equal pay for work of equal value in order to prevent pay discrimination.

‍

The method of joint pay assessment obliges companies to systematically analyze wage differences and present them transparently. The company measures should ensure that equal work, regardless of gender, is paid equally.

‍

In addition to measures at company level, the Directive also highlights the importance of increased cooperation between governments, employers' associations and workers' representatives. These actors should work together to develop gender-neutral pay systems to identify and eliminate systematic inequities.

‍

Obligations of companies: transparency and reporting requirements

‍

Companies must guarantee equal pay for work of equal value. The reporting requirement for companies requires regular reports on pay structures to disclose gender-specific pay differences. Gender-neutral criteria in pay assessment prevent discrimination.

‍

Companies must also ensure that pay data is objective and comprehensible. The European Commission and national authorities monitor compliance with these rules.

‍

If violations are identified, there is a risk of sanctions to enforce compliance with transparency requirements. In addition, companies are required to take measures to correct unequal payment and to review them regularly.

‍

The guideline also places a particular focus on companies with more than 250 employees who are required to publish reports on their pay structures. Smaller companies do not have to comply with these requirements to the same extent, but are also subject to certain transparency requirements, in particular when cases of discrimination arise.

‍

Workers' rights: Information and access to information

‍

Under the Wage Transparency Directive, companies are required to create transparency in order to detect and prevent pay discrimination. Access to information about equal pay for work of equal value is an essential part of this protection.

‍

An objective evaluation of remuneration makes it possible to identify potential inequalities. When discrimination is uncovered, workers have access to justice in order to assert their claims and thus ensure fair pay.

‍

Penalties for breaches of the Directive

‍

The wage transparency directive, adopted by the European Parliament, provides for strict penalties for infringements in order to effectively combat discrimination in pay.

‍

Companies that cannot prove that they pay gender-neutrally and fairly in cases of pay discrimination must expect significant penalties. These specific penalties may include fines, compensation claims for affected workers and, in serious cases, exclusion from public tenders.

‍

National authorities are responsible for monitoring the implementation of the Directive and for punishing breaches. A key part of the measures is to ensure that pay discrimination is treated as a key priority in order to promote equal pay. Enforcing these sanctions not only strengthens workers' rights, but also provides clear incentives for companies to create fair and transparent wage structures.

‍

The aim of the Directive is to ensure that wage discrimination no longer has a place in the European Union. To ensure this, a systematic approach is being established to review wage structures in companies, which enables national authorities to effectively prosecute violations.

‍

Challenges and opportunities for companies

‍

The introduction of the Wage Transparency Directive is a challenge for companies.

‍

● Mandatory disclosure of salaries in particular places an increased burden on employers. Smaller companies, for example, often do not have the same resources as larger companies to prepare reports and meet transparency requirements.

● In addition, publishing salary structures could cause internal pressure for all companies, as employees gain insights into the salary structure, which can cause conflicts.

● In addition, competitors could use this information to strengthen their own position and position themselves better, which clearly disadvantages smaller companies and weaken their competitiveness.

Despite the challenges, the Directive also offers opportunities. With transparent and fair compensation models, companies can build trust and their position as attractive employer strengths. In the long term, this could lead to increasing employee satisfaction and improving employee retention.

‍

Steps to implement salary transparency in practice

‍

Combating pay discrimination requires clear steps to implement salary transparency in practice. The first step is to introduce gender-neutral criteria in pay assessment.

‍

Companies should systematically identify their forms of inequality and take targeted measures to eliminate them. This includes regular reviews of pay structures in order to identify discrimination at an early stage.

‍

The concrete implementation of salary transparency in practice also requires open communication and clear guidelines within the company. This is the only way to strengthen employee trust and ensure fair and equitable remuneration in the long term.

‍

Ultimately, salary transparency helps to create a corporate culture that focuses on equality and fairness. In the long term, the Directive aims for global cultural change in work, in which gender equality becomes not only a legal but also a social guiding principle.

‍