Germany is not exactly known to be a pioneer when it comes to equal pay. In Germany, the pay gap remains particularly large and is only closing slowly, according to the Federal Statistical Office. The Federal Labor Court now took a step ahead to strengthen women’s rights in its latest ruling which will enable women to enforce their rights and simplify proceedings in equal-pay cases by putting the burden of proof on employers.<\/p>\n
What Happened?<\/b><\/strong><\/p>\n A request to her employer by a female executive in the position of the head of department helped her to find out that the average salary of comparable male executives at the company was eight per cent higher than the salary of the female peers.<\/p>\n Her request was based on the Pay Transparency Act (Entgelttransparenzgesetz<\/i><\/em>) which was implemented by the German parliament in 2017 targeting unequal pay of men and women and aiming to close the gender pay gap. According to this still fairly new law<\/a>, in operations with more than 200 employees, employees are entitled to be informed by the employer about the salary of co-workers in similar positions. Specifically, employees may require in-scope employers to calculate the median pay from a comparable group of at least six similarly qualified colleagues of the other gender. The law explicitly states that in case of identical or similar work, direct or indirect discrimination on grounds of gender is prohibited with regard to all pay components and pay conditions.<\/p>\n The plaintiff sued for payment of the difference between her salary and the higher median salary of her male colleagues \u2013 without success in the first two instances. The Regional Labor Court of Lower Saxony rejected her claim arguing that she did not succeed in proving that the lower salary was a discriminatory action by the employer.<\/p>\n Federal Labor Court Puts Burden of Proof on Employer<\/b><\/strong><\/p>\n The Federal Labor Court now set aside the judgement with a reversal of the burden of proof and said that the fact that her salary is lower than the salaries of her male colleagues in the same position was an indicator of gender discrimination. Consequently, it was up to the employer to challenge this presumption and prove that the difference in pay is not based on gender discrimination.<\/p>\n It is now the employer’s turn to prove \u2013 back before the Regional Labor Court \u2013 that the pay gap is based on other reasons than gender, such as training and experience.<\/p>\n This ruling will make it much easier for women to enforce equal pay. The ruling may well encourage women to file a request with their employer in order to find out whether a pay gap exists and, if necessary, to enforce equal pay. The ruling also puts pressure on companies to review and change their salary structures to meet the statutory requirements.<\/p>\n","protected":false},"excerpt":{"rendered":" Germany is not exactly known to be a pioneer when it comes to equal pay. In Germany, the pay gap remains particularly large and is only closing slowly, according to the Federal Statistical Office. The Federal Labor Court now took a step ahead to strengthen women’s rights in its latest ruling which will enable women […]<\/p>\n","protected":false},"author":538,"featured_media":2014,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[556,34,521,725,726],"tags":[78,14,727],"coauthors":[333,728],"class_list":["post-2013","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-client-alert","category-discrimination","category-employment-law","category-german-employment-law","category-international-employment-law-developments","tag-discrimination","tag-equal-pay-2","tag-womens-rights"],"_links":{"self":[{"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/posts\/2013","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/users\/538"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/comments?post=2013"}],"version-history":[{"count":0,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/posts\/2013\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/media\/2014"}],"wp:attachment":[{"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/media?parent=2013"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/categories?post=2013"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/tags?post=2013"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/coauthors?post=2013"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}},{"id":1235,"date":"2016-02-11T06:00:45","date_gmt":"2016-02-11T11:00:45","guid":{"rendered":"http:\/\/blogs.orrick.com\/employment\/?p=1235"},"modified":"2020-09-15T18:28:59","modified_gmt":"2020-09-15T22:28:59","slug":"1235","status":"publish","type":"post","link":"https:\/\/blogs.orrick.com\/equalpaypulse\/2016\/02\/11\/1235\/","title":{"rendered":"Financial Services and Technology Companies Beware: The U.S. Office of Federal Contract Compliance Has A Target on Your Back"},"content":{"rendered":" The President released his 2017 budget this week. Budgets are aspirational documents that Congress rarely implements in full. The current acrimony between Congress and the Administration ensures that the President\u2019s 2017 budget will likely remain aspirational. However, Presidential budgets and their accompanying justifications can shed light on an agency\u2019s priorities.<\/p>\n <\/p>\n The Department of Labor\u2019s Office of Federal Contract Compliance (\u201cOFCCP\u201d) is the federal agency that investigates and enforces the nondiscrimination and affirmative action requirements for federal contractors. The Agency has been on front line of the Administration\u2019s equal pay and other equal opportunity initiatives. OFCCP\u2019s budget<\/a> makes clear that one central priority would be complex investigations of federal contractors in the financial services and technology sectors. Its budget justification states:<\/p>\n Finally, OFCCP will establish two Skilled Regional Centers. These centers, which would be located in the Pacific (San Francisco) and Northeast (New York) regions, would have highly skilled and specialized compliance officers capable of handling various large, complex compliance evaluations in specific industries, such as financial services or information technology. Compliance evaluations conducted by highly skilled compliance officers greatly increase case evaluation quality and timeliness as well as the more efficient use of limited resources. OFCCP must continually improve its enforcement capability to identify discrimination in those economic sectors that are increasingly complex.<\/p>\n The Agency has made it plain that it intends to conduct more complex investigations to aggressively investigate pay and other employment practices like hiring and promotion. In addition, the Agency this year is eliminating its case closure targets and will measure how its staff implements \u201cits enforcement priorities of complex systemic compensation. . .\u201d The upshot is bigger, longer and deeper audits.\u00a0 Until now, though, the Agency has not made it clear that it intends to focus on particular sectors to push forward its pay initiative.<\/p>\n At bottom, as proposed in the budget, audits of financial services and technology firms are likely to become a significant priority. These sectors would expect greater scrutiny in these respects:<\/p>\n At the same time, OFCCP has stated publically that, during its investigation, it does not have to advise a contractor\u00a0in what areas the Agency has found indicators of discrimination. Nor does the Agency have to advise the contractor what factors it is using to analyze pay.<\/p>\n Notably, these investigations would be occurring in very complex financial services and technology workplaces, where compensation decisions are frequently multi-factored and highly individualized. OFCCP\u2019s intent to staff these investigations with highly skilled compliance officers is laudable. However, we noted<\/a> in another context that OFCCP\u2019s sister agency, the Wage and Hour Division, just issued guidance related to whether employers may be considered joint employers that failed to recognize today\u2019s complex employment environments. As such, the Agency and perhaps the Department of Labor overall will have a learning curve as it seeks to make sense of how complex financial services and technology companies operate especially with regard to pay practices.<\/p>\n Companies in financial services and technology looking to be proactive and ready for an audit by OFCCP should conduct a privileged investigation with experienced counsel to assure compliance with the law and develop a strategy for responding to government audits.<\/p>\n","protected":false},"excerpt":{"rendered":" The President released his 2017 budget this week. Budgets are aspirational documents that Congress rarely implements in full. The current acrimony between Congress and the Administration ensures that the President\u2019s 2017 budget will likely remain aspirational. However, Presidential budgets and their accompanying justifications can shed light on an agency\u2019s priorities.<\/p>\n","protected":false},"author":71,"featured_media":1236,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[34,5],"tags":[39,230,88,231,232,78,233,14,71,234,235,236,237,238,22,239,240,241,242,243,244,43,245,246,247],"coauthors":[229,45],"class_list":["post-1235","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-discrimination","category-equal-pay","tag-compensation","tag-compliance-officers","tag-congress","tag-department-of-labors-office-of-federal-contract-compliance","tag-directive-307","tag-discrimination","tag-equal-opportunity-initiatives","tag-equal-pay-2","tag-federal-contractors","tag-financial-services-sector","tag-government-audits","tag-item-19","tag-joint-employers","tag-obama-administration","tag-ofccp","tag-ofccp-budget","tag-ofccp-investigations","tag-pay-analysis-groups","tag-pay-factors","tag-presidents-budget-for-fiscal-year-2017","tag-presidential-budget","tag-scheduling-letter","tag-skilled-regional-centers","tag-technology-sector","tag-wage-and-hour-division"],"_links":{"self":[{"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/posts\/1235","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/users\/71"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/comments?post=1235"}],"version-history":[{"count":0,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/posts\/1235\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/media\/1236"}],"wp:attachment":[{"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/media?parent=1235"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/categories?post=1235"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/tags?post=1235"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/blogs.orrick.com\/equalpaypulse\/wp-json\/wp\/v2\/coauthors?post=1235"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}},{"id":1220,"date":"2016-02-02T09:00:02","date_gmt":"2016-02-02T14:00:02","guid":{"rendered":"http:\/\/blogs.orrick.com\/employment\/?p=1220"},"modified":"2020-09-15T18:29:12","modified_gmt":"2020-09-15T22:29:12","slug":"taking-a-page-from-dols-playbook-eeoc-seeks-to-add-pay-data-to-eeo-1-reports","status":"publish","type":"post","link":"https:\/\/blogs.orrick.com\/equalpaypulse\/2016\/02\/02\/taking-a-page-from-dols-playbook-eeoc-seeks-to-add-pay-data-to-eeo-1-reports\/","title":{"rendered":"Taking a Page from DOL\u2019s Playbook, EEOC Seeks to Add Pay Data to EEO-1 Reports"},"content":{"rendered":" In August 2014, the Department of Labor\u2019s Office of Federal Contractor Programs (\u201cOFCCP\u201d) proposed that federal contractors report compensation information on an Equal Pay report. Amid significant contractor comments that OFCCP coordinate with the EEOC to amend the Employer Information Report (\u201cEEO-1\u201d), EEOC did so on January 29, 2016. The EEOC intends to ask the Office of Management and Budget to approve additional data collection that would require most employers to submit aggregate data on pay ranges and hours worked. The EEOC believes that the additional data \u201cwill assist [EEOC and OFCCP] in identifying possible pay discrimination and assist employers in promoting equal pay in their workplaces.\u201d However, questions remain whether this data would yield any meaningful analysis of actual pay differences that would assist either agency in uncovering pay discrimination.<\/p>\n <\/p>\n Background on EEO-1 and Prior Efforts to Collect Pay Data<\/strong><\/p>\n Currently, the EEO-1 requires certain covered employers with more than 50 employees (contractors) or 100 employees (private industry) to report annually the number of individuals they employ by job category and by race, ethnicity, and sex.<\/p>\n In 2010, the President\u2019s National Equal Pay Task Force was formed to identify ways to improve enforcement of federal laws prohibiting pay discrimination. As a result, the EEOC contracted with the National Academies of Sciences (\u201cNAS\u201d) to study various means to step up federal pay enforcement efforts. Notwithstanding the recommendation that EEOC and OFCCP work together, OFCCP acted on its own and issued its proposal. The EEOC has said that OFCC will utilize the new EEO-1 instead of moving forward with the Equal Pay report.<\/p>\n EEOC\u2019s Proposed Revisions to EEO-1<\/strong><\/p>\n Under the proposed rule, beginning in September 2017, EEO-1 filers with 100 or more employees (both federal contractors and private industry) would be required to include two additional data components to EEO-1 reports\u2014pay data and hours worked.<\/p>\n Pay Data<\/span><\/p>\n W-2 earnings will be used as the source of the pay data. Employers will not be required to provide pay rate information for individuals. However, employers will be required to collect aggregate W-2 data in 12 pay bands for the 10 EEO-1 job categories. Employers will then count and report the number of employees in each pay band. According to the EEOC, these pay bands will allow it \u201cto compute within-job-category variation, across-job-category variation, and overall variation, which would support the EEOC\u2019s ability to discern potential discrimination while preserving confidentiality.\u201d<\/p>\n Hours Worked<\/span><\/p>\n Employers will be required to collect the total number of hours worked by the employees included in each EEO-1 pay band. The hours worked data \u201cwill allow for analysis of pay differences while considering aggregate variations in hours.\u201d<\/p>\n\n