Gender pay gap: MEPs back binding pay-transparency measures

The Women’s Rights and Employment committees want EU companies with at least 50 employees to be fully transparent regarding their salaries.

On Thursday, 17 March 2022, the committees on Women’s Rights and Employment adopted by 65 votes in favour, 16 against and 10 abstentions, their position on the Commission proposal on a Pay Transparency Directive.

MEPs demand that EU companies with at least 50 employees (instead of 250 as originally proposed) be required to disclose information that makes it easier for those working for the same employer to compare salaries and expose any existing gender pay gap within the organisation. Tools to assess and compare pay levels should be based on gender-neutral criteria and include gender-neutral job evaluation and classification systems.

If the pay reporting shows a gender pay gap of at least 2.5% (versus 5% in the initial proposal), member states would need to ensure that employers, in cooperation with their workers’ representatives, conduct a joint pay assessment and develop a gender action plan.

The Commission should create a dedicated official label to award to employers who do not have a gender pay gap in their companies, MEPs add.

Prohibit pay secrecy

The text stipulates that workers and workers’ representatives should have the right to receive clear and complete information on individual and average pay levels, broken down by gender. MEPs also propose to prohibit pay secrecy, via measures forbidding contractual terms that restrict workers from disclosing information about their pay, or from seeking information about the same or other categories of workers’ pay.

Shift of burden of proof

MEPs uphold the Commission proposal regarding the shift of burden of proof. In cases where a worker feels that the principle of equal pay has not been applied and takes the case to court, national legislation should oblige the employer to prove that there has been no discrimination.