Jul
18
French Labour law - Employees, executives, senior executives - Equality Women / Men (égalité Femmes / Hommes): why the index F / H is a biased tool?

On September 1st, 2019, companies between 251 and 1000 employees will have to publish their index equality Women / Men.

In the absence of publication, the penalty is the same as in the absence of any measure aimed at reducing wage differences, and may be as high as 1% of the remuneration and earnings received by the company (L. 2242-8 C.trav).

(See our article: Equal pay for women / men: how to calculate the index? Https://www.village-justice.com/articles/equality-sale-women-men-how-calculate-index.30749.html)

Decree No. 2019-15 of 8 January 2019 and No. 2019-382 of 29 April 2019 specified the implementation of the gender equality index.

This index makes it possible to calculate the pay gap between women and men in companies with more than 50 employees.

However, despite good intentions, many criticisms can be made about him.

This is the purpose of our article.

1) An irrelevant distribution of employees

The decree of June 8, 2019 allows to regroup the employees by professional categories: workers, employees, technicians / supervisors, engineers and managers.

A more detailed breakdown by branch classification or internal rating requires consultation with the CSE, which can be discouraging for the employer. (Annex 1 of Decree No. 2019-15 of January 8, 2019)

First criticism: the basics of initial comparisons are too broad and do not allow a relevant comparison of employees.

2) The weights of the indicators obscure the results

Of the 5 indicators, each represents a different level of points:

- Pay gap: 40 points;

- Difference in rate of individual salary increase: 20 points;

- Promotion rate gap: 15 points;

- Percentage of employees increased on their return from maternity leave: 15 points;

- Number of employees of the under-represented sex among the ten employees who received the highest salaries: 10 points.

But this distribution of points can allow an employer to ultimately get a good score even though the finding of inequality is present.

2.1) Obligation to increase the employees on their return from maternity leave (congé de maternité) : a non-sanctioned violation

The indicator for calculating the percentage of employees increased on their maternity leave returns is noted on 15 points.

This is a legal obligation provided for by Article L. 1225-26 of the Labor Code.

However, an employer whose score is 0/15 to this indicator may still obtain a score above 75 points.

On the other hand, an employer who would increase all her employees returning from maternity leave by an amount equivalent to 1 euro will get all the points, ie 15/15.

Second criticism: the violation of the legal obligation to increase the number of employees on their return from maternity leave has neither a pecuniary effect nor a particularly negative repercussion on the overall score of the indicator.

2.2) Application of a relevance threshold that mitigates pay gaps.

The Excel spreadsheet provided by the Ministry of Labor automatically applies what is called the "relevance threshold", which corresponds to a margin of tolerance [1].

The logic is to apply a deviation tolerance for such broad categories, grouping non-identical levels of responsibility, and not to penalize the company.

Two scenarios then appear to the employer:

It applies classical CSPs, its relevance threshold is 5%;

It applies a different distribution, finer, its relevance threshold is 2%.

However, a company that has an average pay gap of 15%, or 10% after the automatic application of the relevance threshold, can claim a score of 30/40 points and an overall score of 90/100.

Third criticism: the relevance threshold applied in terms of pay gaps makes it possible to conceal large differences that are not revealed by the final mark.

3) The indicators do not reflect the realities of the companies.

The indicators that have the most points - the gender pay gap and the individual earnings gap - overlook two very important aspects:

Part times;

The amount of the difference of increase.

In fact, this remuneration is calculated in full-time equivalent and excluded, in particular, overtime, or increases paid on Sundays or public holidays.

However, 85% of part-time jobs are held by women, erasing these structural differences is a part of the inequalities that is not taken into account [2].

Moreover, the reality of the increases is not taken into account, so that an increase in wages by the collective agreement will be considered as an increase.

As a result, according to this indicator men and women will have been increased, even if a woman will have just seen his salary revalued by ten euros, when a man will have touched him an increase of one hundred euros.

Fourth criticism: the indicators do not take into account individual growth gaps and partial times, giving a biased image of the reality of the company on gender equality.

4) The implementation of sanctions by the Labor Inspectorate a difficult project.

As for the amount of the sanctions, the control procedure and the implementation, the procedure remains unclear.

Especially since the government project projects a minimum of 7,000 inspections per year for labor inspectors [3].

Today there are just over 1,000 inspectors in France and the implementation of this decree must be done at constant strength.

Fifth criticism: the penalties provided by the deadlines granted are not dissuasive enough for companies.

5) A real lack of transparency.

The company must publish the index on its website, if it has one, or failing to bring it to the attention of its employees by any means.

The index corresponds to a score of 100 points resulting from the addition of the indicators.

Also, in our opinion, it is regrettable that the decree does not require the publication of all the indicators.

Sixth criticism: in the absence of the obligation to publish all indicators, the overall score is in no way revealing the real situation of the company.

In conclusion, despite good intentions, the Excel spreadsheet setup proposed by the Ministry of Labor and the implementation of the decree allow companies to easily hide discrepancies, and remain well below the legitimate expectations in terms of equality between women and men. / men.

Despite good intentions, the Gender Equality Index is not enough to stop wage disparities between women and men.

Frédéric CHHUM, Avocat et membre du conseil de l’ordre des avocats de Paris
Marion Simoné, Elève-avocat EFB Paris
CHHUM AVOCATS (Paris, Nantes, Lille)
email : chhum@chhum-avocats.com
www.chhum-avocats.fr
Twitter : @fchhum
Instagram : fredericchhum

 

 

[1] Lien vers le tableur.

[2https://www.insee.fr/fr/statistique...

[3Objectif de contrôle des inspecteurs du travail.

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