The Directive on Pay Transparency (the “Directive”) has been formally adopted and published. The Directive will enter into force on June 6, 2023 and must be implemented in national legislation within three years and in each company within a fourth year.
๐๐ฒ๐ป๐ฑ๐ฒ๐ฟ ๐ฃ๐ฎ๐ ๐๐ฎ๐ฝ ๐ฅ๐ฒ๐ฝ๐ผ๐ฟ๐๐ถ๐ป๐ด
Under the new rules, ๐จ๐ฆ๐ฏ๐ฅ๐ฆ๐ณ ๐ฑ๐ข๐บ ๐จ๐ข๐ฑ ๐ณ๐ฆ๐ฑ๐ฐ๐ณ๐ต๐ช๐ฏ๐จ will become mandatory for many private and public employers in the European Union.
The reporting requirement will take effect in two stages:
๐ญ. By 2026, employers with 250 or more employees must report their gender pay gap annually; employers with 150 to 249 employees must report every three years; and
๐ฎ. By 2031, employers with 100 or more employees must report every three years.
๐ง๐ฟ๐ฎ๐ป๐๐ฝ๐ฎ๐ฟ๐ฒ๐ป๐ฐ๐ ๐ ๐ฒ๐ฎ๐๐๐ฟ๐ฒ๐
In addition, the Directive provides for greater transparency, effective enforcement and access to justice to ensure one of the fundamental principles of the European Union: ๐ฆ๐ฒ๐ถ๐ข๐ญ ๐ฑ๐ข๐บ ๐ง๐ฐ๐ณ ๐ฎ๐ข๐ญ๐ฆ ๐ข๐ฏ๐ฅ ๐ง๐ฆ๐ฎ๐ข๐ญ๐ฆ ๐ฆ๐ฎ๐ฑ๐ญ๐ฐ๐บ๐ฆ๐ฆ๐ด, ๐ณ๐ฆ๐จ๐ข๐ณ๐ฅ๐ญ๐ฆ๐ด๐ด ๐ฐ๐ง ๐ต๐ฉ๐ฆ ๐ด๐ช๐ป๐ฆ ๐ฐ๐ง ๐ต๐ฉ๐ฆ ๐ฆ๐ฎ๐ฑ๐ญ๐ฐ๐บ๐ฆ๐ณ.
The key elements are:
> Wage transparency for job seekers
> Prohibition on requiring job applicants to provide information on past or current salaries
> Right of employees to information on their individual salary and the average salary level of the same category of employees, disaggregated by gender
> Salary transparency in the salary principles
Read the full Directive here.
This article was first published by our Romanian and UAE member firm Suciu – Employment & Data Protection Lawyers. For more information and assistance with employment law matters in their jurisdictions, please contact our representative Andreea Suciu, Managing Partner of the firm.
