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On 14 October 2020, Royal Decree Law 902/2020 of 13 October 2020 on equal pay for women and men was published in the Official State Gazette (BOE). It is expected to enter into force on 14 April 2021 .The pay register is coming: a new obligation for companies

Among other things, this new regulation establishes the obligation for all companies with employees to create a so-called pay register.

What is the purpose of this decree?

Establish specific measures to give effect to the right to equal treatment and non-discrimination between women and men with regard to pay.

What are the basic principles of this standard?
Principle of pay transparency 

Companies and collective agreements must integrate and apply the principle of pay transparency. This principle shall be applied to the different aspects that determine the remuneration of employees and its different elements. This makes it possible to obtain sufficient and meaningful information on the value attributed to such remuneration.

The aim is to identify both direct and indirect discrimination, if any, particularly due to incorrect job evaluations.

Specifically, it will be implemented, at least, through the instruments regulated in the new regulation:

  • Remuneration registers, mandatory for all companies as of 14/04/2021
  • The remuneration auditThe equality plan is compulsory for companies that have to draw up an equality plan:
    • companies with agreements that make it concrete
    • by number of employees
      • 8/03/20 all with more than 150 employees
      • 8/03/21 all with more than 100 employees
      • 8/03/22 all with more than 50 employees
    • The labour authority, normally the labour inspectorate, is obliged to
  • The job evaluation system of the professional classification contained in the company and in the applicable collective bargaining agreement.
  • Workers'right to information.

 

Principle of equal pay for work of equal value.

The principle of equal pay for work of equal value is laid down in Article 28.1 of the Workers' Statute. This binds all companies regardless of the number of employees, and all collective agreements and collective bargaining agreements.

Correct job evaluation requires the following criteria to be applied:

  • Adequacy
    •  implies that the relevant factors in the assessment must be those factors related to the activity and that are actually present in the activity, including the necessary training.
  • Totality
    • The totality implies that, in order to determine whether equal value is present, all the conditions that make the job unique must be taken into account, without any of them being made invisible or undervalued.
  • Objectivity
    • Objectivity implies that there must be clear mechanisms in place that identify the factors that have been taken into account in the setting of a particular remuneration and that do not depend on social factors or valuations that reflect gender stereotypes.

 

What are the general rules on the pay register?
  • All companies should have a pay register for their entire workforce, including management and senior management.

 

  • The pay register shall include the average values of salaries, allowances and non-wage payments of the staff disaggregated by sex.

 

  • The arithmetic mean and median of what is actually received for each of these items in each occupational group, occupational category, level, post or any other applicable classification system shall be established in the pay register of each company, suitably broken down by sex.

 

  • The information must be disaggregated according to the nature of the remuneration, including basic salary, each of the allowances and each of the non-wage payments, specifying each payment separately.

 

And with regard to workers, what obligations appear?
  • When access to the register is requested by the female worker due to the absence of legal representation, the information to be provided shall be limited to the percentage differences in the average remuneration of men and women, which shall also be disaggregated according to the nature of the remuneration and the applicable classification system.

 

  • In companies where there is legal representation of the workers, access to the register shall be provided to the workers through the said representation, and the workers shall have the right to know the full content of the register.

 

  • The workers' legal representatives shall be consulted at least ten days before the register is drawn up.

 

  • The reference period is generally the calendar year.

Where the enterprise has more than 50 employees and there is a difference of 25 per cent or more between the wages of men and women, a justification that the difference is not related to the sex of the workforce must be included in the wage register.

Are there possible penalties for non-compliance?

Article 10 of RD 902/2020 establishes that the absence of the pay register may lead to administrative and judicial action and/or the application of sanctions for discrimination. According to the system of offences and penalties of the LISOS (Law on Offences and Penalties in the Social Order), depending on the seriousness of the facts, penalties of between 6,251 and 187,515 euros may be imposed.

The development of the regulations and, above all, of the inspections, will allow us to specify more and better the format and content of this register. In any case, at Confialia we are prepared to create and maintain the remuneration register: a new obligation for companies.