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Suspected case of pay discrimination (TAS 137/2019, issued on 11 February 2020)

In this pay dispute, the Ombudsman for Equality was asked to determine whether A had been treated in a manner that violates the Act on Equality between Women and Men (hereafter ‘Equality Act’) as she was paid a lower salary than the men performing comparable tasks.

The key issue is whether the work tasks performed by A have been equally demanding or of equal value as those performed by the men in question.

Provisions of the Equality Act

The action of an employer must be deemed to constitute discrimination prohibited under the Equality Act if the employer applies the pay or other terms of employment in such a way that one or more employees find themselves in a less favourable position on account of their gender than one or more other employees in the employer’s service performing the same work or work of equal value.

However, equality between genders has not been violated if the employer can prove that its action is based on some other acceptable reason than gender.

The principle of equal pay is applied when the work tasks are so similar that they can be considered the same, or when the tasks are so similar in terms of complexity that they are of equal value. When it is assessed whether the work tasks are the same or of equal value, the decisive factor is not the job title or any other similar criterion, but the type of work that the employees actually perform.

The salary component based on the complexity of the work tasks (task-specific salary) must be the same if the tasks are the same or of equal value. The total salaries do not have to be of equal size if there is an acceptable reason for the pay differences. All salary supplements paid in addition to task-specific salaries must also be non-discriminatory. The discriminatory nature of the salaries is assessed separately for each salary component.

Acceptable reason

Acceptable reasons for pay differences may include a person’s education, professional skills, initiative and suitability for more demanding tasks. The competitive environment arising from a shortage of qualified employees may also be such a reason.

When the complexity of the work tasks is assessed, no consideration should be given to the personal characteristics or work performance of individual employees even though they may be acceptable grounds for paying different salaries to employees performing the same tasks or tasks of equal value. If the employer applies such criteria, it must be able to demonstrate the existence of differences between the employees.

The level of education can only be considered an acceptable reason for pay differences if, on account of the differences in the level of education, an employee can manage their work tasks better than another employee or if the better-educated employee is more available to the employer.

Inadequate financial resources

Different treatment of employees cannot be justified by referring to economic considerations and inadequate financial resources. If, on the basis of a salary comparison performed in accordance with the Equality Act, the work tasks are deemed to be of equally demanding nature, the employer cannot justify an employee’s lower salary by referring to inadequate financial resources.

Statement by the Ombudsman for Equality

According to the employer, the tasks of all employees, irrespective of their gender, are largely the same. Moreover, the employees have specific responsibilities that have not affected their pay. However, the men performing comparable work have received a salary supplement for performing special tasks.

The employer has justified the higher salary paid to the men performing comparable tasks by saying that they have longer professional experience and that their work has been more demanding and has involved more responsibility.

The performance of the tasks related to the development of operations and other responsibilities mentioned by the employer can be deemed to increase the complexity of the work task. However, the duration of the development tasks, the concrete nature of the other tasks involving operational and personnel responsibilities, or the quantitative share of these tasks of the overall job description of the men concerned were not clear from the information submitted by the employer.

In his statement, the Ombudsman for Equality noted that, based on the information received, the job description of the men performing comparable tasks could not be considered more demanding than that of A as a whole. It must also be taken into account that the men performing comparable tasks have received a personal salary supplement for specific tasks even though no salary supplements have been paid for the other specific responsibilities mentioned by the employer. According to the Ombudsman for Equality, the salary component based on the complexity of the work and all salary supplements separately must be non-discriminatory. Both men and women should have equal opportunities to receive salary supplements.

The Ombudsman for Equality has concluded that an assumption of pay discrimination arises in the matter.

However, the level of professional experience of A or the employees performing comparable tasks or the role played by the higher level of education of A or any longer professional experience of the employees performing comparable tasks as factors contributing their work performance had not been examined in the matter.

To the extent that the specific content of the work tasks and their complexity remained open, more detailed evidence can be presented in connection with a compensation claim against the employer in the district court.