Germany: New Pay Parity Legislation Effective Jan. 1, 2018

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By Andrea Barbara Schuessler

Germany's new pay parity legislation will become effective Jan. 1, 2018, a spokeswoman with the Ministry for Family Affairs, Senior Citizens, Women and Youth told Bloomberg BNA in an email May 16. Under the new legislation, individuals working in companies with more than 200 employees (around 14 million employees overall) will be entitled to information on how their pay is calculated and to anonymized information on average salaries of five employees with similar jobs. In addition to the average monthly gross salary, employees can request up to two separate remuneration components (such as bonuses, rewards, company car regulations) to be able to compare their wages, the spokeswoman said.

“If there is a works council/staff association in the company, the works council has to provide the answers on pay equity unless the employer takes on the responsibility. This should strengthen the role of the social partnership and the exchange of ideas on pay equity within the company,” the spokeswoman said.

Where there is no staff association or workers' council and no collective bargaining agreement, employees will be allowed to request the information directly from their employers.

In addition, private companies with more than 500 employees will be encouraged to evaluate their pay structures to ensure pay parity and to file regular reports on their progress.

“We want women to be paid as fairly as men,” Germany's Family Minister Manuela Schwesig of the Social Democratic Party, Chancellor Merkel's partner in her grand coalition government, said March 30 when the Bundestag, the lower house of parliament, approved the legislation. “Due to the individual right for employees in companies with more than 200 employees and the reporting requirements and test procedures, companies have to deal with their remuneration structures.”

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

Full text of the pay parity legislation is available in German

here.

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

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