IR Notes

The gender pay gap in the EU fell from 16.4% in 2012 to 14.1% in 2019 but the pace of change is still too slow (see Eurostat data and Gender pay gap). On 4 March, with a view to ensuring that “women and men are paid equally for the same work”, the European Commission put forward a proposal for a directive which “aims at laying down minimum requirements strengthening the application of the principle of equal pay between men and women and the prohibition of discrimination on grounds of sex through pay transparency and reinforced enforcement mechanisms” (Article 1) (see press release and Questions and Answers published by the Commission. This directive would apply to both the private and public sectors and to all workers who have an employment contract or employment relationship as defined by the case-law of the Court of Justice (Article 2). It includes a number of measures, such as: 1/ A revision of pay structures to ensure “that women and men are paid equally for the same work or work of equal value” to help employers to better “categorize and remunerate job positions based on objective, gender-neutral criteria” (Article 4). 2/ A provision requiring employers to indicate in advance the pay level on offer for the position concerned (Article 5). 3/ A right to request information “on their individual pay level and on the average pay levels, broken down by sex, for categories of workers doing the same work or work of equal value” (Article 7). 4/ Companies with at least 250 employees will have to publish a report on data relating to the gender pay gap, based on seven criteria (Article 8). 5/ A joint pay assessment will have to be performed in conjunction with employee representatives in cases where the pay gap ratio shows a difference in average pay of at least 5% between female and male workers, across all categories of workers (Article 9). 6/ A reversal of the burden of proof will be imposed if the employer has not implemented the above obligations. In this case, “it shall be for the employer to prove that there has been no such discrimination.” 7/ Improved enforcement mechanisms and easier access to justice. 8/ Compliance with obligations linked to the principle of equal pay is required within the framework of public contracts. The proposal will be sent to the Council and to the European Parliament for its first reading.
> See also: a study performed by The European Foundation for the Improvement of Living and Working Conditions (Eurofound), entitled  “Women and labour market equality: Has COVID-19 rolled back recent gains?”, December 2020), which evaluates the cost of pay gaps in the European economy at 2.4 points of GDP and notes the first negative effects of the COVID-19 crisis on women’s participation in the labour market.

Pay transparency – social partners’ reactions (see Lead story) : The employers’ organisation BusinessEurope says it is ready to accept “reasonable requirements on pay transparency” (see press release). However, it argues that the key is to “address the root causes of inequalities, especially gender stereotypes, labour market segregation and insufficient provision of childcare”. It emphasises that the Commission’s proposals must 1/ respect national social partners’ competences for wage-setting; 2/ allow pay to be determined according to individual performance; 3/ fully respect the confidentiality of individual pay; 4/ should not complicate human resources management with excessive administrative burdens; 5/ not open the way to undue litigation. The view taken by the European Trade Union Confederation (ETUC) is that the directive “contains many good principles” but is let down by “inadequate tools” to make it work in practice (see press release). In particular, the ETUC denounces 1/ the threshold of 250 employees, considering it to be too high; 2/ the fact that employers are left to define which jobs can be compared when it comes to equal pay for work of equal value; 3/ the references throughout the text to “workers’ representatives” only, rather than to “trade unions”.

European Pillar of Social Rights Action Plan : On 4 March, the European Commission published a European Pillar of Social Rights Action Plan (see press release and Commission staff working document). The action plan, which constitutes the Commission’s contribution to the Porto Social Summit on 7 May, sets out three major objectives to be achieved by 2030: 1) at least 78% of people aged 20 to 64 should have a job (instead of 73.1% in 2019); 2) at least 60% of adults should participate in training activities every year (compared to 37% in 2016); 3) the number of people at risk of poverty or social exclusion should fall by at least 15 million (out of a total of 91 million in 2019, before the pandemic struck). For the most part, this action plan draws together the various initiatives already adopted by the Commission (minimum wages, pay transparency, etc.) and those included in its work programme, which come under the auspices of one of the twenty principles of the European Pillar of Social Rights (see Social Pillar). For example: a revision of the recommendations for promoting quality traineeships with a view to enhancing the working conditions on offer to trainees (2022), a legislative proposal relating to AI in the workplace (2nd half of 2021), a new occupational safety and health strategy (2nd half of 2021), an initiative on setting up individual learning accounts (4th quarter of 2021) and a proposal to combat gender-based violence (4th quarter of 2021). However, the plan remains very cautious with regard to the creation of any new workers’ rights to information and consultation; instead, it “encourages” Member States to guarantee procedures for informing and consulting workers in the event of a restructuring. As for the right to disconnect, which the European Parliament is calling for, the plan merely provides for an “appropriate follow-up” to Parliament’s resolution. This action plan is also accompanied by a Commission recommendation on an effective active support to employment (EASE) following the COVID-19 crisis, to encourage a recovery that will create jobs. This recommendation promotes “job creation and job-to-job transitions from declining sectors towards expanding sectors, notably the digital and green ones”. The European Trade Union Confederation welcomes the initiative, while at the same time expressing its regret at certain shortcomings, and in particular the lack of any legislative initiatives on: a minimum income; an unemployment reinsurance scheme at EU level; information, consultation and participation of workers; and revision of the European Works Council directive (see press release).  For its part, BusinessEurope has reacted mainly to the proposal for a directive on pay transparency, which formed part of the action plan (see above).

Consultation on self-employed workers’ rights to collective bargaining : On 5 March, the European Commission launched a public consultation to prepare for an initiative seeking to ensure that EU competition rules do not stand in the way of collective bargaining by certain self-employed people. Under EU competition law, self-employed people are considered “undertakings” and thus risk infringing competition rules when they bargain collectively and reach “agreements” that might distort the free play of competition (see Commission press release). It should be borne in mind that the Commission had already raised this issue within the framework of a broader consultation, launched in June 2020, on the digital services package (see press release). It also published, on 6 January, an Inception Impact Assessment setting out several options, which are, at minimum, limiting collective bargaining to platform workers only, through to extending it to all self-employed workers, including self-employed professionals.

Consultation on working conditions provided by platforms : On 24 February, the European Commission launched a first-phase consultation of European social partners concerning an initiative, which is distinct from the previous one (see above) on the working conditions of platform workers (see Commission press release and Gig economy). The Commission believes it will be useful to “address the potential misclassification of the employment status” of these workers. Consequently, it may consider action “to improve clarity and predictability for authorities, businesses and workers”, and putting in place a “rebuttable presumption of employment status” or a “reversal of burden of proof”. Moreover, “rights could be defined regarding currently unpaid search or waiting time”. In addition, “to preserve the health and safety of people working through platforms, overall working time might need to be monitored”. As well as the question of the status of these workers, which has been the subject of many disputes, the Commission is also asking the social partners to react on five other points: 1/ Access to social protection in order to cover platform workers against the main risks; 2/ Access to collective bargaining and to the right to information and consultation. The social partners could consider “possible representation and collective defence of the interests of workers at the appropriate platform decision-making level”. 3/ Algorithmic management, with the proposal “to ensure more effective redress mechanisms for workers to challenge algorithmic management decisions and improve transparency and predictability of automated decision-making”. 4/ The cross-border dimension of platform work (including social security contributions and tax collection). 5/ Training and professional opportunities for people working through platforms.

Uber engages in advocacy to promote the independent status of its drivers : While the European Commission is embarking on multiple initiatives aimed at improving the working conditions of platform workers, Uber is undertaking powerful lobbying activities to defend its business model. This activism, which has been condemned by the European Trade Union Confederation (see press release), has led Uber to publish a lobbying document aimed at European decision-makers, carrying a message that can be summarised as follows: the more Uber enhances the protection of its self-employed workers, the more the company becomes exposed to the legal risks of having them reclassified as employees. “Legal ambiguities” and the contradictory decisions reached by national courts are making it “difficult for platforms like Uber to provide both access to flexible work and benefits and social protections to independent workers”.
> See also: The Irish government, reacting to the UK Supreme Court ruling on Uber, has no plans to create an intermediate status between employment and self-employment, along the lines of ‘workers’ in the UK (see article in the Irish Times).

• A European strategy for Persons with Disabilities : On 3 March, the European Commission presented a Strategy for the Rights of Persons with Disabilities 2021-2030 (see press release and Disability). It announces the creation of a European disability card that will facilitate mutual recognition of disability status between Member States.

• Due diligence : Following the agreement reached within the grand coalition (see IR Notes 158), on 3 March, the Federal cabinet passed the bill “on reasonable diligence exercised by companies within supply chains” (see press release).

Teleworking : On 24 February, the lower chamber of the Austrian Parliament (Nationalrat) passed the tax provisions allowing the agreement between the government and the social partners on supervision of teleworking to be applied (see press release). Under the agreement, the necessary work equipment has to be supplied by the employer; if the employee uses their own facilities (e.g. laptop, mobile phone, call charges), the employer will have to refund the costs incurred. The monies paid by the employer to cover teleworking costs, such as fixed amounts paid for digital equipment or allowances, will in future be exempt from tax and social security payments as part of a fixed 3 euros per day allowance for teleworking, up to a maximum of 300 euros per year. (see article published by the GPA trade union).

• Proposal to create reproductive health-related leave : The Labour Party has submitted a bill to grant a set number of days’ leave to people who are encountering problems with their reproductive health, whether associated with fertility treatment, IVF or miscarriages. The Labour Party is calling on the government to support this initiative, which would provide employees with up to 20 days’ paid leave, rather than obliging people who are experiencing such difficulties to use their paid leave or to take unpaid leave (see press release).

Encouragement for flexible working : Liz Truss, the Minister for Women and Equalities, has called on employers to normalise flexible working (see press release). She cites a study, one of whose findings was that a job offer explicitly mentioning flexibility (part-time working, flexible working options, teleworking, etc.) attracted 30% more applicants. If all advertisements were to explicitly mention flexible working options, it is estimated that around 174,000 flexible jobs could be created every year. Women, who are twice as likely as men to work flexibly, would be the main beneficiaries of this change.

• Pregnant women being forced out of their jobs: A charity set up to support women who are made redundant during their pregnancy, says that this phenomenon has been amplified by the Covid-19 pandemic. In a normal year, the organisation provides legal advice to about 3,000 women, but in 2020 it was contacted by 32,000 of them. A survey of 20,000 mothers and pregnant women found that 15% of them had been made redundant, or expected to be (see article in The Guardian). This situation is highlighted by a bill that will go forward for its second reading in March, and aims to prohibit redundancy during pregnancy and maternity leave and for six months after the end of the pregnancy or leave.

Breach of the right to information and consultation : The EWC of the Adecco group has just won a non-appealable victory before the UK’s Central Arbitration Committee (CAC), which is the authority responsible for resolving industrial relations disputes. This important decision concerns firstly, the company’s refusal to consult the EWC’s Steering Group about successive restructurings it undertook in several EU Member States, and secondly, management’s refusal to provide information on the company’s business sales performance, broken down by country. The CAC Panel based its decision on the agreement setting up the EWC, the relevant provisions of which stipulate that the EWC is competent to deal with transnational matters concerning either the group as a whole or at least two establishments in two different EU Member States. A Steering Group meeting is convened where exceptional circumstances arise, notably in the event of collective redundancies in at least two different countries. Lastly, a provision specifies that matters involving one or more sites in one or more countries, which form part of the company’s day-to-day management activities, lie outside the EWC’s competence and must be dealt with specifically within the framework of national information and consultation procedures. In May 2020, the Steering Group discovered that collective redundancies had already been implemented or announced in the following countries: Hungary (13% of the workforce), the Netherlands (43% of the workforce) and Sweden (25% of the workforce). Other redundancies were subsequently announced in Germany in June 2020.  Management claimed that these were “national” issues unrelated to any decision taken by them at European or global level, and refused, as they had done in similar circumstances in 2018 and 2019, to inform and consult either the EWC or the Steering Group. The CAC Panel held that they were wrong to do so, and found in favour of the Steering Group, even though the reasons justifying the redundancies varied from one country to another, and even though there was no requirement for the redundancies to be “proposed, approved or co-ordinated at central level or at any level beyond that of the individual country”. To prepare for the EWC’s annual meeting, the Steering Group had also requested the most recent data on the company’s country-by-country business performance, so that it could undertake a “detailed assessment” of the information, its possible impact and, if applicable, could prepare itself for a consultation. Here too, management refused to provide a country-by-country breakdown. The CAC finds against management  for breaching both the agreement setting up the EWC and UK national legislation (Article 18A of the TICE Regulations), taking the view that the “provision of information at a more macro level” is inadequate for the purpose of performing an in-depth analysis.

Gender equality : The Commission has published its 2021 annual report on gender equality in the EU, which shows the negative impact of the COVID-19 pandemic on women. The pandemic has exacerbated existing inequalities between women and men in almost all areas of life (see press release). The Commission has also launched a Monitoring Portal to support its Gender Equality Strategy unveiled a year ago, for the purpose of monitoring the performance of the Twenty-Seven in this area.