09 UK GENDER PAY GAP | BDO LLP
Appendix EU Pay Transparency Directive
In March 2023, the European Parliament voted in favour of adopting the EU’s Pay Transparency Directive (‘the Directive’) aiming to improve the application of the principle of equal pay through several measures focused on pay transparency. The Directive needs to be formally adopted by EU member states and will be transposed into national law within three years. The new legislation will not apply to UK companies, unless they are a UK registered business with operations in an EU member state, in which case, they will be required to comply with the EU reporting requirements for those operations.
Recruitment
Right to information
Employers must disclose the starting pay rate or salary range in the job listing or prior to an interview. It will be prohibited for employers to inquire about a candidate’s salary history. All job listings and titles will have to be gender neutral.
Employees have the right to obtain information about their own pay level and the average pay level for colleagues who perform the same work or work of equal value, categorised by gender.
Pay criteria
Pay reporting
Employees will have the right to access the criteria used to define pay levels and pay rises. Criteria related to pay progression can include individual performance, skills development and seniority.
Employers with at least 100 employees will have to regularly run gender pay gap assessments. Where differences in average pay for the same work or work of equal value between female and male workers are not justified by objective gender-neutral criteria, the employer should take measures to remove the inequalities. Employers will need to take corrective measures where the difference in average pay levels between male and female workers exceeds 5%.
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