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EU proposes new directive to ensure equal pay for men and women


The European Union is proposing the implementation of new Directive to ensure the right to equal pay between women and men.

The implementation of the EU principle of equal pay was established in 1957 and is one of the founding principles enshrined in the Treaty of Rome.

Putting forward the Directive, the EU states: “The gender pay gap in the EU remains around 14%. The pay gap has long-term impact on the quality of women’s life, their increased risk of exposure to poverty and on the persisting pension pay gap, which is 33% in the EU.

“The Covid-19 pandemic and its economic and social consequences makes it even more pressing to tackle this issue, given that the crisis has hit female workers especially hard.”

A lack of pay transparency has been identified as one of the key obstacles and the European Parliament has repeatedly called for more action at EU level to enhance the application of the equal pay provisions.

Ursula von der Leyen, President of the European Commission, has previously announced the Commission would bring forward new binding pay transparency measures and this commitment was reaffirmed in the gender equality strategy 2020-2025.

The requirement to ensure equal pay is set out in Directive 2006/54/EC (the ‘Recast Directive’) as complemented in 2014 by a Commission Recommendation on pay transparency (the ‘2014 Recommendation’). Despite this legal framework, the effective implementation and enforcement of this principle in practice remains a challenge in the EU.

The EU says this new initiative aims at tackling the persisting inadequate enforcement of the fundamental right to equal pay and ensuring that this right is upheld across the EU, by establishing pay transparency standards to empower workers to claim their right to equal pay.

The Directive launches a series of clear and strict rules which the member states must introduce into their national legal systems when transposing the Directive. The deadline for doing so is three years after the entry into force of the Directive.

The proposed Directive is aimed at:

· establishing pay transparency within organisations;

· facilitating the application of the key concepts relating to equal pay, including ‘pay’ and ‘work of equal value’; and

· strengthening enforcement mechanisms.

Building on the Recast Directive and the 2014 Recommendation, this proposal introduces new and more detailed rules to ensure compliance with the principle of equal pay between men and women for equal work or work of equal value.

The directive makes it possible to strengthen existing provisions while leaving Member States discretion as to how to implement the new rights and obligations. This is part of a broader package of measures and initiatives addressing the root causes of the gender pay gap and economic empowerment of women.

The initiative is “part of a multipronged approach, including, among others, the Work-Life Balance Directive, sectoral initiatives to fight stereotypes and improve gender balance, and a proposed directive on improving gender balance on the boards of large EU listed companies.”

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