Denmark: Stricter Gender Equality Reporting Requirements Axed

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By Marcus Hoy

March 4— New revisions to Denmark's Gender Equality Act will ease documentation requirements for smaller companies and increase employee privacy, a Copenhagen-based HR attorney tells Bloomberg BNA. In a March 1 statement, Rasmus Linding of the legal firm Norrbom Vinding said that amendments to the Equal Pay Act (899/2008), which took effect Feb. 15, were supported by the majority of businesses.

Under the former rules, all companies with at least 10 salaried employees including at least three men and three women were required to file annual information on each worker's salary to the state data collection body Danmarks Statistik. Under the new rules, this threshold is raised to companies with at least 35 employees, including at least 10 of either sex. The change reverses the policy of the previous center-left government, which lost power to the current right-leaning coalition in June 2015. As with the former regime, failure to file the required information is punishable by a fine.

The threshold of 35 employees was previously in effect between 2007 and 2014 when the former government reduced the threshold to 10 employees. At the time, the expansion of the requirement was opposed by business organizations, including the Confederation of Danish Employers, which claimed the new mandate placed an unfair burden on smaller companies and could lead to individual employees' salaries being identified. While companies' salary statistics are placed in the public domain, individual employees are not identified, but some employers claimed that published salaries could easily be connected to specific employees at smaller companies.

Heightened Anonymity

“It is our impression that companies are satisfied with the amendment,” Linding said. “It will entail a reduction in the administrative burden for smaller companies, who will now not have to spend time preparing gender-based statistics on salary levels. In addition, the amendment will also benefit employees who see their salary as a private matter. The desire for anonymity in some cases can hardly be accommodated in smaller companies that have as few as 10 employees of either sex.”

“The new rules are in the main identical to those that took effect in 2007,” Linding said. “This amendment contains few differences, and those that exist are mainly of a technical nature.”

In a March 2 statement, Pia Moltke Jensen, an attorney at the Lett legal firm, told Bloomberg BNA that the measure is not universally popular. The raising of the threshold was opposed by employee groups including the Danish Confederation of Trade Unions, which had argued that salary inequality is more pronounced in smaller businesses.

Boardroom Targets

While the new salary documentation obligation is applicable to the majority of businesses, Jensen said, already-existing requirements related to gender equality are only applicable to larger companies. These include an obligation to initiate across-the-board gender equality targets and a requirement to document the gender balance of the board of directors and senior management.

To be covered by these additional requirements, companies must meet two of the following criteria in two consecutive financial years:

  • assets totaling at least 143 million kroner ($21,000),
  • net revenue of at least 286 million kroner ($42,000) and
  • a minimum of 250 employees.
  •  

    On Feb. 27, 2015, the state-funded Danish Business Authority published guidance related to larger companies' gender equality obligations in accordance with the Ordinance on Boardroom Targets (341/2013), which obliges affected companies to implement specific gender-equality policies. The obligation affects approximately 1,200 companies, the Business Authority said.

    All companies covered by the new salary documentation requirement must deliver their figures for 2015 by Sept. 1, 2016.

    To contact the reporter on this story: Marcus Hoy in Copenhagen at correspondents@bna.com

    To contact the editor responsible for this story: Rick Vollmar at rvollmar@bna.com

    For More Information

    The new legal amendment is available in at https://www.retsinformation.dk/Forms/R0710.aspx?id=177383, the Business Authority's guidance for larger companies at https://erhvervsstyrelsen.dk/sites/default/files/media/vejledning_om_maaltal_og_politik_for_den_koensmaessige_sammensaetning_i_ledelsen_og_for_afrapportering_herom_-_i_praksis.pdf, both in Danish.

    For more information on Danish HR law and regulation, see the Denmark primer.