The European Union recently passed a set of new rules meant to close the gender pay gap and combat intersectional discrimination. Aimed at providing equal pay for employees carrying out work of equal value, this law will apply to all public and private employers throughout the region. To help companies of all sizes adapt to the changes, member states are to offer training and tools to assess job values.
At the same time, the directive requires companies to inform job seekers of starting salaries for open positions and give employees information on their individual and average pay levels, broken down by gender. Employees are to have access to the criteria used to determine pay and career progression, which must be objective and gender-neutral. Meanwhile, companies with more than 250 employees will have to report annually on their gender pay gap, while companies with fewer than 250 will have reporting cycles of three or eight years. Employers who break the rules will be penalized with fines and/or revocation of benefits.
So, what does this mean for startups? It means taking a close look at their pay structures and ensuring that they don’t reflect any gender-based differences. Startups may face challenges as they adopt to the new regulations, but the benefits of closing the gender pay gap should not be ignored. Equal pay will help establish social justice, bolster business performance, and strengthen the economy. Moreover, the new rules provide a level playing field for startups to compete with larger companies for talent.
Two people are mentioned in the original article – Ioanna and Kira Marie Peter-Hansen. Ioanna is a writer at TNW, covering the European tech ecosystem with an interest in startups, sustainability, green tech, AI, and EU policy. With a background in the humanities, she is passionate about social impact-enabling technologies. Kira Marie Peter-Hansen is the rapporteur of the Employment and Social Affairs Committee and was instrumental in the passing of the new gender pay gap rules.
Jenny Keisu and Marta Sisà Jiménez are also referenced in the original article. Jenny Keisu is the CEO of the Swedish eboat-maker X Shore and is an advocate for creating change against the gender pay gap. Marta Sisà Jiménez is the Head of HR at Freepik Company, a Malaga-based scaleup. According to Jiménez, the new regulations will provide clarity around an issue that was previously lacking, while making sure that large companies and SMEs compete on the same terms. David Perez, VP of Stakeholder Relations at Cabify, highlighted the importance of analyzing each job individually in order to avoid prejudice. He also noted the potential of the new rules in unifying the reporting of pay data among companies.
All in all, the EU’s new gender pay gap rules will have huge implications for startups across the continent. Companies must be aware of the obligations and challenges that come with the directive. If done right, they will be able to reap the multiple benefits that come with secure equal pay for male and female employees.
