In Germany, women can now demand to be told how much their male colleagues are earning.
The country’s new Wage Transparency Act, which came into force on January 6 2018, empowers many German employees to find out the median salary of six colleagues of the opposite sex, in a comparable role. It aims to address the country’s gender pay gap, which, at 21%, is among Europe’s highest.
But the policy’s early impact has been limited. So what can government and the private sector do to boost its effectiveness?
Equal work for equal pay
The right to equal pay for equal work has been part of European legislation since the 1950s. Until now, however, it has been difficult to prove in Germany that a woman is being paid less than a male counterpart in a parallel position. The act aims to change that.
There were fewer than 20 salary inquiries at Deutsche Post, Henkel, Bosch, Audi, Continental and Deutsche Bahn. Allianz, Deutsche Bank and Deutsche Telekom saw better uptake with 293, 164 and 120 respective requests in the first quarter of 2018. None resulted in claims for unequal pay.
“At this early stage, the Wage Transparency Act can be seen in some ways as symbolic legislation,” said Nora Markard, cofounder of the Gesellschaft für Freiheitsrechte e.V. (GFF), a legal association for civil and human rights in Germany. “It doesn’t do so much work on the ground, but the fact that it’s being addressed sends strong signals: You have a right to equal pay, and we take it seriously. ”
There are a number of ways to increase the act’s impact, said Markard.
In the immediate term, communication is key. “It might be that workers haven’t heard about the act, or don’t understand how to use it or how it pertains to them,” she said. A March 2018 survey by consulting firm EY revealed that less than half of the 1000 professionals questioned were aware of the new law.
Currently, the act only applies to companies with over 200 employees, though smaller companies also bear a responsibility for the overall pay gap.
“A woman who works in a firm with 199 employees does not have a right to information under this act, and a woman who works in a small business with five, six or seven employees certainly does not, which means two thirds of all working women in Germany… are exempt,” said Elke Hannack, deputy chairperson of the DGB, Germany’s Trade Union Confederation, in an interview with Deutschlandfunk.
Furthermore, companies employing 500 staff or more are encouraged to report internally on their pay structure and implement equal pay monitoring — yet this remains voluntary.
“We need to create role models — find women who are ready to take companies on”
Plus, whatever the outcome of the request for information, employees are not granted a salary adjustment — instead they must sue their employer, despite potential power imbalances. “A request for information always puts the women concerned in a difficult situation,” said Hannack.
She recommends that, if possible, employees submit the request anonymously via a works council.
For Markhard, it’s important to highlight successful cases. “We need to create role models — find women who are ready to take this on — and then communicate it very clearly.”
Similar laws enacted recently by the UK and Iceland put the onus squarely on companies to reveal their data and prove they pay fairly, so that single employees are not forced to fight for transparency.
“We can learn from Iceland and see this as something to address together,” she said. “Now it’s about going into the structures, which requires a lot more than people are ready to admit.”
Meanwhile, advocates encourage people to take advantage of the act with the hashtag #stelldiefrage (#askthequestion). “The more cases and numbers we have, the better we can act as a union against the gender pay gap,” said Anna-Maria Wagner of the German Journalists Association (DJV) in its online magazine.
“If we don’t use it because it’s not perfect, when the act is evaluated it might look like we don’t need it,” Markard concluded. “We have to show that we appreciate the effort, that we’re using it — and then demand more.” — Natalie Holmes