A new ILO paper on the importance of pay transparency legislation

A new paper by the International Labour Organization (ILO), Pay transparency legislation: Implications for employers’ and workers’ organizations, published on September 2022, shows that pay transparency measures can help to address the gender pay gap and reduce broader gender inequalities in the labour market.

According to the paper, reducing the gender pay gap is a major challenge, especially in the post-pandemic context, which has further exacerbated gender inequality within countries.

The study offers a detailed mapping of existing equal pay legislation worldwide and discusses arguments for and against pay transparency legislation.

Stressing the role of employers’ and workers’ organisations, it presents the outcomes of an online survey conducted with social partner organisations between July and September 2021. Semi-structured interviews were conducted between October and November 2021 to understand how pay transparency measures are implemented in practice and the effectiveness of pay transparency legislation in promoting equitable pay policies.

The results show a great diversity in approaches used by countries worldwide, considering that many countries have only recently introduced pay transparency legislation, and their effects still have to come.

According to the paper, pay transparency reports are one of the most commonly implemented measures at the country level. Pay transparency measures can also encompass periodic pay disclosure, audits and workers’ right to access pay data or digital tools, enhancing access to information.

Pay transparency can provide workers with the relevant information and evidence they require to negotiate pay rates and the means to challenge potential pay discrimination. At need. Atthe same time, it is an opportunity for employers to identify and address those and pay discriminations that might affect the workplace.

Social partners should actively participate in debates regarding pay transparency and the gender pay gap and, more broadly, workplace gender equality.

Social dialogue, including collective bargaining, can address pay discrimination, promote inclusive wage-setting processes and pursue specific pay transparency measures to eliminate pay discrimination in the world of work.

The principle of equal pay for equal work (or work of equal value) between men and women through pay transparency and enforcement mechanisms is also the goal of the European legislative proposal for a Pay Transparency Directive, as we reported here.