Women in the European Union still earn less than men for equal jobs. The average gender pay gap in the EU is 13%. The European Parliament has now approved EU’s new directive on pay transparency that was proposed in 2021. The directive gives workers right to information on pay in their category of work and companies must act if their genders pay gap is over 5%.
The EU gender pay gap has only been reduced with 2.8 percentage points over 10 years, according to EU statistics.
Under the new rules, pay structures to compare pay levels will have to be based on gender-neutral criteria and include gender-neutral job evaluation and classification systems. Vacancy notices and job titles will have to be gender neutral and recruitment processes led in a non-discriminatory manner.
The new rules were adopted by the parliament’s plenary by 427 votes. But 79 MEPs voted against and 76 abstained.
Next step is that ministers in the European Council must formally approve the agreement before the text is signed into law and published in the EU Official Journal. The new rules come into force twenty days after their publication.
Member States will have three years to include the rules in national law:
- If pay reporting shows a gender pay gap of at least 5%, employers will have to conduct a joint pay assessment in cooperation with their workers’ representatives.
- Member states will have to put in place effective, proportionate and dissuasive penalties, such as fines, for employers that infringe the rules.
- A worker who has suffered harm as a result of an infringement will have the right to claim compensation.
- For the first time, intersectional discrimination and the rights of non-binary persons have been included in the scope of the new rules.
The rules stipulate that workers and workers’ representatives will have the right to receive clear and complete information on individual and average pay levels, broken down by gender. Pay secrecy will be banned; there should be no contractual terms that restrict workers from disclosing their pay, or from seeking information about the same or other categories of workers’ pay.
On pay-related issues, the burden of proof will shift from the worker to the employer. 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.
The principle of equal pay is laid down in Article 157 TFEU. However, across the European Union, the gender pay gap persists and stands at around 13%, with significant variations among member states from -0.2 % in Luxembourg to 20.5 % in Estonia