EU directive on “Equal Pay Day” is controversial

Today’s “Equal Pay Day” shows how big the pay differences between women and men are, even after a ruling from last year. An EU directive wants to change that – but critics fear the opposite.

A year ago, Susanne D. had tears in her eyes before the Federal Labor Court – they were tears of joy. She thinks of her daughters, of the women in Germany, she said, and is so happy “about this milestone.”

The sales employee had fought for a salary increase and 2,000 euros in compensation for discrimination. She had a basic salary of 3,500 euros on the list. Your colleague, who as a sales person, does exactly the same thing, a thousand more. That’s not how it works, the Federal Labor Court ruled. For Sarah Lincoln, the plaintiff’s lawyer, this was a landmark ruling – equal pay for equal work.

Men, Lincoln noted, negotiated more successfully – and were often awarded more money. However, according to the ruling, this is “no longer a justification for a salary difference”.

Call for “cultural change”

The German ruling anticipated a radical reform in Brussels that is to be implemented throughout the EU by 2026. Companies must prepare for this today, demanded the Federal Commissioner for Anti-Discrimination, Ferda Ataman. A “cultural change” is necessary here – “and on the other hand, more women must defend themselves legally so that a rethink takes place.”

Far too few people have done this so far, criticizes DGB boss Yasmin Fahimi, even though what Brussels wants to implement on a large scale already exists at the federal level on a small scale: more transparency, more justice.

The pay transparency law in Germany “didn’t achieve much,” notes Fahimi. And it’s not always easy to sue your boss. She also asks herself how women, especially in smaller companies where there is no works council, can “actually enforce their rights”.

Trade unions hope for the EU

The unions are hoping for a great European solution. And this is exactly where the Brussels directive comes in – it will change that, promises the Christian Democrat Maria Walsh: “We must eliminate the gender pay gap once and for all.”

The MEP from Ireland helped write the reform. A right of collective action is intended to prevent women from being left to their own devices. Changes should be made from a pay gap of five percent, no matter how big the company is. Only the specific activity counts, not job descriptions.

Complicates the policy Salary increases?

This is exactly where many employers see problems when the new EU directive comes. Individual salary increases are becoming more difficult, for example for better performance or to keep someone in the company.

But the EU sees no alternative. In recent years, not enough has happened when it comes to equal pay between women and men. “Our workers need tools to compare salaries and ensure they are paid fairly and equally for the work they do,” says MEP Walsh.

According to the EU statistics authority, this is currently only the case in Luxembourg. The wage gap is even greater than in Germany in Austria, Estonia and Switzerland, while things look relatively good in Romania, Poland, Italy and Belgium and the wage differences are between three and five percent.