Employers grumble about rules that should help close the wage gap

The average hourly wage for women in the Netherlands was 10.5 percent lower than for men last year. In the EU, that will be 12 percent in 2023. It is a gap that needs to be closed. "Most employers agree on that," says Jannes van der Velden, spokesperson for employers' association AWVN.

But there is more discussion about the way in which this will be done, as is evident from the responses to the bill from Minister Eddy van Hijum (Social Affairs and Employment), which is still under consultation until today.

As a result of a previously adopted EU directive, new rules will apply in the Netherlands from the middle of next year to ensure that men and women receive equal pay for equal work.

The law effectively creates a 'collective obligation' to be transparent when it comes to salaries, says Jet Stolk, a lawyer at Houthoff, who assists entrepreneurs in complying with the rules. Companies with 100 employees or more are also required to map their wage gap and report on it (periodically).

• Employees' wages must be determined objectively and gender-neutrally on the basis of a fixed structure and companies must be transparent about this.
• Companies must, in consultation with the works council, take appropriate measures within 6 months if the wage gap for equal work appears to be greater than 5 percent and cannot be objectively explained, for example on the basis of experience or education.
• Companies with 100 or more employees must report on internal wage differences.
• During the employment conditions interview, you may not be asked about your last earned salary from your previous employer.
• Before the employment conditions interview, for example in a vacancy text, you must be informed about the starting salary or its range.
• Discussions about wages among employees should not be prohibited.

Individual employees can rely on the wage information to find out whether there is unequal pay in their case, and thus also enforce closing the gap. Not only in the future, but also up to five years back, says Stolk.

"Works councils may also ask companies to actively close a wage gap if it is found," says Stolk. Works councils do not deal with individual employees, but can generally increase the pressure on companies after a report.

That is also where the biggest fear lies for many entrepreneurs. "It is going to require a lot," says Mieke Ripken, spokesperson for trade associations MKB-Nederland and VNO-NCW. According to her, companies must be able to formulate categories of equal work within a company and set up a system for the appreciation thereof.

In many cases, these systems are already (partly) in place, but how exactly this should be implemented is not clear to everyone. Many entrepreneurs are still insufficiently prepared, as a survey by Het Financieele Dagblad showed earlier this week.

The ministry says it is working on tools for entrepreneurs, but according to the Dutch Association of Insurers, these are not yet available, while the legislation must be clear and enforceable and time is running out.

Anyone who reports also runs the risk of being pilloried. The government intends to check whether companies comply with the rules - and if not, that can lead to fines and penalty payments that can also be made public, says Stolk. According to various sources, the Dutch Labour Inspectorate would be charged with the checks, but the agency itself has not been able to provide any explanation for this to date.

According to AWVN, this is a bitter pill, because the figures that a company must report do not always reflect the full reality. Data on wage gaps are not automatically peeled off to individual differences, says the organization. "It also concerns gross figures, the wage differences are much smaller in net terms," ​​says Van der Velde.

The question is whether the mandatory transparency and reporting obligation will actually ensure that the wage gap is closed. This is not substantiated in the current bill, says the Advisory Board for Regulatory Burden Assessment (ATR), which advises the cabinet.

"This creates the risk that efforts for employers and the resulting regulatory burden are not in proportion to the expected social impact," says the advisory body that recommends further evaluation of the effects of the rules. In other words, the cabinet itself still has work to do.

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