EU Directive on Gender Pay transparency is welcome but falls short of what is needed

04 March 2021

Responding to the publication today by the EU Commission of their proposed directive on Pay Transparency between women and men, Labour’s employment affairs spokesperson Marie Sherlock welcomed the long awaited publication.

Senator Sherlock said:

“Ultimately, gender pay gap legislation is only one of a series of measures necessary to reduce the gap in pay between men and women in this country. However, the EU directive contains some important initiatives that would potentially shine an important spot light into the pay levels and pay progression practises within organisations.

“There is a welcome focus on preventing the opening up of a pay gap by ensuring pay transparency for job seekers as the pay level or pay range will have to be advertised or notified to job applicants. Similarly, the directive proposes to give workers the right to access information on their pay relative to comparable workers and that they must be notified of this right on an annual basis.Interestingly the directive stipulates that claimants should be allowed recover their own costs and not be liable for their employers’ cost in the event of a case been taken.

“Disappointingly, the directive only provides for gender pay gap reporting by firms with 250 or more employees. This compares with 50 in the Irish Government’s own proposed bill. The directive also fails to stipulate the type of information that should be reported. This is crucial in shining that important spot light on wage dispersion and wage inequality between roles and occupations along with looking at those who are working on a full time or part time basis.

“In 2018, my colleague Senator Ivana Bacik introduced the Gender Pay Gap Information Bill. This passed all stages of the Seanad and is awaiting passage through the Dáil. The Government introduced its own legislation in 2019 and despite many assurances, we have seen no progress with this Bill.

“Overall, the scale of the challenge facing Ireland in trying to reduce the gender pay gap is enormous. The average weekly wage gap between men and women was 25.05% as of the latest available data in 2018 (source CSO Earnings using Administrative Data). This is because women fall behind in the hourly pay and many are trapped in part time employment (defined by the CSO as less than full time hours). This gender pay gap leads on to an even wider pensions gap of 28.6% as of the latest available data in 2019 (source Eurostat).

“Ultimately it is the EU Commission’s proposed directive on adequate minimum wages that has thepotential to be a game-changer for reducing the gender pay gap. This was published last December and stipulates that member states must put in place framework for collective bargaining when collective bargaining coverage is below 70%. There is now a large body of research which shows that countries with higher levels of co-ordinated bargaining tend to have lower wage dispersion and those with lower wage dispersion tend to have less of an earnings gap between men and women in the labour force.”

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