Royal Decree 902/2020 of 13 October, which establishes specific measures to reinforce the right to equal treatment and non-discrimination between women and men in relation to remuneration, has been published and will come into force on 14 April 2021.
Principle of transparency in remuneration
The regulation establishes a principle of transparency in remuneration, to enable both direct and indirect discrimination to be identified, in particular where discrimination arises where work of equal value attracts lower pay without the difference being lawfully justified. This principle must be reflected in each of the following areas:
- Remuneration records,
- Remuneration audit,
- Job evaluation system of the professional classification,
- Collective agreement that was applicable and
- Workers' right to information.
Companies and collective agreements must integrate and apply the principle of transparency of remuneration.
Obligation of equal pay for work of equal value
All companies, regardless of the number of workers, must comply with the obligation of equal pay for work of equal value.
Work of equal value is work where the nature of the functions or tasks involved in the job, the educational, professional or training conditions required to do the work, the factors related to the performance of the tasks and the working conditions in which the activities are actually carried out, are equivalent.
To ascertain whether work is of equal value, all relevant conditions must be taken into account objectively (and must not depend on social factors or assessments that reflect gender stereotypes): Relevant factors may include – but are not limited to:
- hardship and difficulty, repetitive movements, dexterity, thoroughness, isolation, responsibility (economic and related to people's well-being), versatility, social skills, care and attention skills, conflict resolution capacity or organisational capacity,
and these factors must satisfy the requirements of suitability, completeness and objectivity in relation to the job they value.
Part-time workers have the same rights, including remuneration, as full-time workers. Any proportional reduction must ensure that there is no negative impact on the enjoyment of rights related to maternity and child or dependent care.
Mechanisms for remuneration transparency
All companies must have a record of remuneration for all staff, including management and senior staff. The purpose of this register is to ensure transparency in the design of remuneration, in an accurate and up-to-date manner, and adequate access to companies' remuneration information.
The remuneration register should include the average values of the salaries, salary supplements and extra-salary payments of the staff, broken down by sex and distributed by professional groups, professional categories or jobs of equal or equal value.
The remuneration register must include the average and median of what is actually received for each of these pay components in each occupational group, occupational category, level, position or any other applicable classification system, broken down by sex.
This information must then be dis-aggregated based on the type of remuneration, including basic salary, each of the supplements and each of the extra-wage payments, specifying each payment in a differentiated manner.
The temporary reference period shall be 1 year, unless there are substantial changes to any element that makes up the remuneration register (e.g. where the employer hires a significant amount of new staff in the relevant period)
The company must consult the workers' legal representatives at least 10 days prior to drawing up or changing the register.
Access to the remuneration register:
- When there are legal representatives of the workers in the company: access to the register will be made available to workers via the legal representatives , who will be able to access the full content of the register.
- When there are no legal representatives of the workers in the company: The register will be accessible by employees directly, but the information that must be made available to employees will be limited to 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.
Companies with 50 or more employees will be required to develop and implement a remuneration audit as part of its equality plan. The application of pay audits will follow the same gradual application as equality plans:
- Companies with more than 150 and up to 250 employees: they must draw up and implement an equality plan and remuneration audit within one year: March 2020.
- Companies with more than 100 and up to 150 employees: must draw up and implement an equality plan and remuneration audit within two years: March 2021
- Companies with 50-100 employees: to develop and implement an equality plan and remuneration audit within three years: March 2022
Companies that must carry out remuneration audits also have the following additional obligations in relation to the remuneration register :
- The record shall also reflect the averages and medians of the groupings of jobs of equal value in the enterprise, according to the results of the job evaluation, even if they belong to different sections of the occupational classification, broken down by sex and dis-aggregated.
- The record shall include the justification referred to in Article 28.3 of the Workers' Statute*, when the mean or median of the total remuneration in the company of the workers of one sex is at least twenty-five per cent higher than that of the other sex.
[*Article 28.3 - When in a company with at least fifty workers, the average of the salaries of the employees of one sex is higher than those of the other by twenty-five percent or more, taking the total wage cost or the average of the paid remunerations, the employer must include in the salary register a justification that said difference responds to reasons not related to the sex of the workers.]
Implications of the remuneration audit: Companies must carry out an assessment of the remuneration situation in the company and establish an action plan for correcting any inequalities identified, and noting the people responsible for the implementation and monitoring of the corrective actions.
The assessment requires: (i) The evaluation of jobs to identify which jobs are of equal value and (ii) the relevance of other factors which trigger the pay gap, as well as possible deficiencies or inequalities which could be seen in the design or use of measures for work-life balance and co-responsibility in the company.
The remuneration audit will be valid for the same period as the equality plan, unless a shorter period is determined.
Valuation of jobs in collective agreements
A procedure for evaluating jobs will be approved by means of an order issued at the joint proposal of the heads of the Ministries of Labour and Social Economy and the Ministry of Equality.
The Women's Institute for Equal Opportunities will produce a best practice guide to identify and overcome stereotypes in recruitment and promotion. It will also produce a technical guide with guidelines for carrying out pay audits with a gender perspective.
Entry into force
The Royal Decree will come into force six months after its publication in the BOE, i.e. on 14 April 2021.
Section 2 and 3 of article 28 of the Workers Statute, already in force, regulates the following obligations:
- The employer is obliged to keep a record of the average values of salaries, wage supplements and extra pay of its staff, broken down by sex and distributed by professional groups, professional categories or jobs of equal or equal value. Workers have the right to access, through the legal representation of workers in the company, the wage register of their company.
- Where, in an enterprise with at least fifty workers, the average pay of workers of one sex is twenty-five per cent or more higher than that of the other, taking the total payroll or the average of the payments made, the employer shall include in the Pay Register a justification that the difference is due to reasons unrelated to the sex of the workers.