A document called the ‘European Sustainability Reporting Standards’ (ESRS) sets out the obligations and contains certain ‘application requirements.’ ESRS S1 (Social 1) relates to disclosure on “own workforce” and this is the Standard that most HR professionals will need to be concerned with.
Below, we set out the 17 Standards that make up ESRS S1, along with links to the disclosure requirements (DR) and the application requirements (AR). We also link to our own Global HR Law Guide, to show how these topics are regulated across the world.
1. Policies
By Standard 1, employers are required to disclose policies that apply across the board to employees and relate to certain sustainability matters. For example, policies on respect for human rights and policies banning forced labour, child labour, harassment and discrimination.
2. Engaging with workers and workers’ representatives
By this Standard, employers are required to disclose how and through which channels they engage with employees and/or their representatives (e.g. works council or other employe representative bodies) on sustainability impacts.
3. Remedying negative impacts and having channels for raising concerns
By this Standard, employers are required to disclose how and through which channels they engage with employees and/or their representatives (e.g. works council or other employe representative bodies) on sustainability impacts.
4. Taking action on impacts, mitigating risks and taking opportunities
Employers are required to disclose progress on initiatives contributing to positive sustainability impacts and preventing negative impacts.
5. Managing negative impacts, advancing positive ones and managing risks and opportunities
By this Standard, employers are required to disclose how they set and use targets to drive and measure progress and manage risks and opportunities.
6. Characteristics of the workforce
To meet this Standard, employers need to disclose key characteristics of their workforce such as headcount and how it is divided in terms of temporary and permanent contracts, full- and part-time contracts and how it splits on gender lines.
7. Characteristics of non-employee workers
Employers are required to disclose key characteristics of non-employees who are part of the employer’s ‘own workforce,’ such as contractors and temporary agency employees, including their estimated numbers, as expressed in terms of the number of full-time equivalent employees.
8. Collective bargaining and social dialogue
Employers need to disclose how far working conditions and terms of employment are influenced or determined by collective bargaining agreements, and to what extent employees are represented in social dialogue.
9. Diversity
Employers are required to disclose on (i) the gender distribution of top management and (ii) the age distribution among all employees.
10. Adequate wages
Employers are required to disclose whether or not all their employees receive an “adequate” wage (as defined in the application requirements).
11. Social protection
This Standard requires employers to disclose whether their employees are protected against income loss for major events, including sickness, unemployment, employment injury and disability, parental leave and retirement.
12. Persons with disabilities
Employers are required to disclose the percentage of their employees with disabilities.
13. Training and skills development
By this Standard, employers need to disclose how much training and skills development they offer employees.
14. Health and safety
Employers are required to disclose information on their health management systems and figures relating to incidents that have resulted in work-related injuries, fatalities and ill health.
15. Work-life balance
Employers are required to disclose what family-related leave is available to their workers.
16. Pay
Employers must disclose (i) the percentage pay gap between its female and male employees and (ii) the ratio between the pay of its highest-paid individual and the median pay of its employees.
17. Incidents, complaints and severe human rights impacts
Employers are required to disclose the number of work-related incidents and/or complaints and severe human rights impacts within their workforce, and any related material fines, sanctions or compensation.
Want to explore the full document? Access it here for detailed insights and the complete text in PDF format.
If you have any questions about this complex and somewhat daunting area, don’t hesitate to get in touch with us
