{"id":65939,"date":"2024-02-22T11:22:42","date_gmt":"2024-02-22T10:22:42","guid":{"rendered":"https:\/\/intellias.com\/?post_type=blog&p=65939"},"modified":"2024-06-14T12:18:03","modified_gmt":"2024-06-14T10:18:03","slug":"beyond-the-gender-pay-gap-reinforcing-a-level-playing-field-in-the-workplace","status":"publish","type":"blog","link":"https:\/\/intellias.com\/pay-transparency\/","title":{"rendered":"Beyond the Gender Pay Gap: Reinforcing a Level Playing Field in the Workplace"},"content":{"rendered":"

Despite some progress, the gender pay gap in the European Union remains persistently high, with women earning on average 13% less<\/a> per hour than men. In response, the European Parliament has adopted the EU directive on equal pay and pay transparency, aimed at closing this gap in the European Union. Though the conversation on gender equality with regards to workers\u2019 pay has been around for years, many companies have been taken off guard by the new law and now must move fast to adapt to the new reality.<\/p>\n

Long before the EU directive on pay transparency<\/a> was approved, we started building a culture of fairness, equality, and inclusion at Intellias. The values reflected in the EU directive resonate with our own long-standing values, and we want to share our transformation journey, wisdom we\u2019ve gained along the way, and our own solutions that can help other organizations embrace the transition to pay transparency.<\/p>\n

The EU pay transparency directive: On the way to a gender-equal Europe<\/h2>\n

The new EU directive around pay transparency was adopted on March 30, 2023, and is expected to be transposed into national legislation of EU member states within three years. The goal of this directive is to reinforce the principle of equal pay for equal work<\/em> between men and women. The directive promotes fair pay and strives to tackle the gender wage gap through pay transparency standards and enforcement mechanisms.<\/p>\n

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Today\u2019s adoption of the pay transparency directive is a significant step towards addressing the gender pay gap in the European Union and increasing women\u2019s economic and financial independence.<\/p>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\tHelena Dalli, <\/span> EU Commissioner for Equality<\/span><\/span>\n\t\t\t\t<\/small>\n\t\t\t<\/blockquote>\n\t\t<\/section>\n

The EU rules on pay transparency include a series of binding measures that touch on many aspects of the employment process and will have a huge impact on companies\u2019 reward policies:<\/p>\n

Gender pay gap reporting<\/h4>\n

The directive introduces gender pay gap reporting obligations, compelling companies to disclose information on gender-based pay disparities and conduct joint pay assessments in cooperation with employee representatives if the gender pay gap exceeds 5%.<\/p>\n

Pay transparency measures<\/h4>\n

The directive establishes provisions to promote a culture of pay transparency within organizations, encouraging employers to promote salary fairness. Prior to employment, employers must disclose salary ranges to future employees and cannot inquire about a candidate\u2019s pay history.<\/p>\n

Equal pay for equal work<\/h4>\n

The directive strengthens the principle of equal pay for equal work, emphasizing that employees should receive remuneration without gender-based discrimination.<\/p>\n

\"Factors<\/p>\n

Source: European Council<\/a><\/em><\/p>\n

Right to information<\/h4>\n

Employees have the right to access workforce pay information, broken down by gender, to determine whether they are compensated fairly compared to other employees doing the same work or work of equal value. The directive also gives employees the necessary tools to claim their right to equal pay.<\/p>\n

Job-related criteria<\/h4>\n

The directive emphasizes the importance of using objective, gender-neutral, and bias-free criteria when determining pay levels, such as skills, experience, effort, responsibility, and qualifications.<\/p>\n

Remedies and sanctions<\/h4>\n

The directive establishes effective remedies for those experiencing pay discrimination and sanctions for non-compliance, including financial penalties, to ensure enforcement of pay transparency measures.<\/p>\n

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Equal work deserves equal pay. And for equal pay, you need transparency. Women must know whether their employers treat them fairly. And when this is not the case, they must have the power to fight back and get what they deserve.<\/p>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\tUrsula von der Leyen, <\/span> President of the European Commission<\/span><\/span>\n\t\t\t\t<\/small>\n\t\t\t<\/blockquote>\n\t\t<\/section>\n

The implications of the directive go far beyond pay transparency in the EU. The directive will increase employee involvement in addressing pay equality and conducting regular pay audits. It will also impact recruitment, pay, and reporting processes and raise the profile of equal pay across the EU, Switzerland, the UK, and beyond.<\/p>\n

The directive\u2019s obligations are a vital component of a broader European initiative extending well beyond gender equality. Employers will also be required to proactively pursue workplace diversity and implement inclusive policies. This aligns with Europe\u2019s vision for a forward-looking Environmental, Social, and Governance (ESG) strategy to ensure long-term sustainability.<\/p>\n

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How can companies prepare for the new law before it comes into force?<\/h2>\n

The countdown has started, and organizations need to take action to get ready for big changes before the directive\u2019s provisions go into effect in 2026. While establishing gender equality and pay transparency in the workplace is a complex challenge, it helps companies foster a culture of fairness and build trust and credibility among employees. Here are some of the proactive measures employers can take to narrow the gender pay gap and maintain a forward-thinking approach.<\/p>\n