Germany: Implementation of Pay Parity Legislation Could Be Difficult, Labor Lawyer Says

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By Andrea Barbara Schuessler

Nov. 7— Germany's new gender pay parity legislation will very likely become effective in 2017, but implementation may prove difficult, Alexander Zumkeller, a lawyer based in Baden-Baden and president of the Federal Association of Labor Lawyers in Business, told Bloomberg BNA Oct. 20.

Employees in companies with a staff of at least 200 would be entitled to receive anonymized information on average salaries of five employees with similar jobs, according to the new legislation included in Chancellor Angela Merkel's coalition agreement. This would include about 14 million employees.

In companies covered by collective bargaining agreements, staff associations would be in charge of this right to information. Where there is no staff association or workers' council and no collective bargaining agreement, employees would be allowed to request the information directly from their employers.

For many positions, however, it could be difficult to assess what's an “equivalent occupation,” Zumkeller said.

Collective Bargaining Still Key

Employers remain skeptical of the initiative for other reasons as well. Companies bound by collective bargaining agreements may already have achieved the legislation's goals, for example, but will now be burdened with additional administrative responsibilities, Zumkeller said.

“Employers are for fair and transparent pay for women and men,” Ingo Kramer, President of the Berlin-based Confederation of German Employers' Associations, said in a statement after the coalition meeting Oct. 6, adding that collective bargaining is the best guarantee of this

“We are therefore pleased that the coalition parties have refrained from imposing additional control procedures, reporting and information obligations on all companies, including those covered by a collective bargaining or works council agreement, which would only have added additional bureaucracy,” Kramer said. “The social and collective bargaining partners will continue to exercise their particular responsibility for the equal treatment of women and men in the future.”

More to Do

In addition to providing more transparency in pay policies, the new legislation is intended to sensitize employers to the issue of gender pay disparities as a way of addressing the current 21 percent pay gap, Germany's family minister Manuela Schwesig said.

The new legislation will be passed to the German Cabinet in December and should get parliamentary approval in summer 2017, Verena Herb, spokeswoman for the Family Ministry, told Bloomberg BNA Oct. 20.

Gender pay parity is an important issue, but Germany needs a larger social debate on ways to encourage female participation in the workforce that would, for example, encourage more flexible-working models to balance work and family life, Ursula Groden-Kranich, Bundestag member for Chancellor Merkel's Christian Democratic Union (CDU), told Bloomberg BNA Oct. 20.

To contact the reporter on this story: Andrea Barbara Schuessler in Berlin at correspondents@bna.com

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

For More Information

The draft pay parity legislation of December 2015 is available in German here.

For more information on German HR law and regulation, see the Germany primer.

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