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New equal pay proposals in the EU: what do they say?

Global
02.04.21
2
The European Commission has published a draft directive on equal pay, focusing on pay transparency and on redress for victims of pay discrimination. This article provides details.

On 4 March 2021, the European Commission set out its new proposals in relation to equal pay between men and women in the European Union.  

The proposed directive focuses on two key areas: pay transparency and access to justice for victims of pay discrimination.  

Pay transparency

Transparency for job-seekers 

Under the new proposals, employers will have to provide information about pay rates and ranges in the initial job advertisement or before interview. Employers will not be allowed to ask candidates about their salary history.  

Right to information 

Workers will have the right to request information from employers on their individual pay level and on average pay broken down by sex. 

Gender pay gap reporting 

Employers of 250 or more employees will have to report on pay differences between men and women in their organisation.  

Joint pay assessment 

Where a pay gap reporting exercise reveals a gap of at least 5% which cannot be justified on objective, gender neutral grounds, employers must carry out an assessment in conjunction with workers’ representatives.  

Justice for victims of pay discrimination

Compensation 

Workers who suffer gender pay discrimination will be entitled to compensation, including full recovery of back pay including any bonuses or benefits in kind.  

Burden of proof 

The burden of proof will be on the employer to demonstrate that there was no pay discrimination.  

Sanctions 

Under the proposals, member states will be required to introduce penalties for infringements of equal pay rules. They must set minimum fine levels for breaches. 

Collective action 

Workers’ representatives and equality bodies can act in legal proceedings on behalf of workers and coordinate collective actions on their behalf.  

Next steps

The proposal needs to be approved by the European Parliament and Council before it can be adopted. Once it is adopted, member states will have two years to implement into national law.