Guideline on wage transparency presented

New proposals aim to significantly improve workers' rights.

A new European directive intends to put an end to wage discrimination between employees doing the same job in the same company. This was a political priority of President von der Leyen.

The proposal for a directive by the European Commission sets out pay transparency measures, such as pay information for job seekers, a right to know the pay levels for workers doing the same work, as well as gender pay gap reporting obligations for big companies.

The proposal also strengthens the tools for workers to claim their rights and facilitates access to justice. Employers will not be allowed to ask job seekers for their pay history and they will have to provide pay related anonymised data upon employee request. Employees will also have the right to compensation for discrimination in pay.

This means that larger employers will be obliged to publish salary information annually and will no longer be allowed to ask job applicants about previous salaries. Employees will have more opportunities to challenge alleged pay inequalities and claim back their missed earnings.

The proposal to combat wage inequality make wages in a company transparent and enable employees to challenge discrimination. Job applicants must be informed of their starting level and salary prospects before the interview. Employees will have the right to be informed about how much they are being paid in comparison to the average for the same work and on a gender-specific basis.

Another renewal for the employer is to prove that there is no discrimination if an employee earns less than a colleague doing the same job. This is important for women, who on average receive 14% less pay in the EU than an equivalent male colleague. This proposal wants EU member states to impose fines on companies that do not comply with equal pay. The mandatory publication of the wage policy in the annual report or on the website is for companies and organizations with more than 250 employees.

Commissioner for Equality, Helena Dalli, said: “The pay transparency proposal is a major step toward the enforcement of the principle of equal pay for equal work or work of equal value between women and men. It will empower workers to enforce their right to equal pay and lead to an end to gender bias in pay. It will also allow for the detection, acknowledgment and addressing of an issue that we wanted to eradicate since the adoption of the Treaty of Rome in 1957. Women deserve due recognition, equal treatment and value for their work and the Commission is committed to ensuring that workplaces meet this objective.”

It is now up to the European Parliament and the European Council to adopt a position on the committee's proposal.