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BAG: Equal remuneration for same or equal work? – Presumed discrimination on the grounds of gender in the case of higher comparative remuneration

Gender pay gap. Seesaw with wooden cubes with signs of men and women with different stacks of coins, man get bigger salary, copy space

In case a woman’s remuneration is lower than the comparative remuneration of male employees disclosed by the employer according to the Transparency in Wage Structures Act (Entgelttransparenzgesetz – EntgTranspG) justifies the rebuttable presumption of discrimination on grounds of gender – Federal Labour Court (Bundesarbeitsgericht – BAG), decision of 21 January, 2021 – 8 AZR 488/19.

In the case on which the decision was based, the plaintiff, who was employed as head of department requested information from the defendant in August 2018 according to the EntgTranspG. This revealed that the average remuneration of comparably employed male department heads was higher than the plaintiff’s remuneration, both in terms of the monthly average basic remuneration and the above-standard bonus. The plaintiff sued for payment of the difference between the basic remuneration and bonus paid to her and the higher median remuneration disclosed to her for the months August 2018 to January 2019.

The EntgTranspG is intended reduce gender-specific wage inequities by granting employees a right to information as to whether they receive equal remuneration for same or equal work compared to their colleagues. Employers are required to provide information about reference remuneration as the full-time equivalent, projected, statistical median of the average monthly gross remuneration. For this purpose, the average monthly gross remuneration is first calculated for each person in the comparison group. All remuneration paid to an employee in a calendar year is shown as a total and then divided by twelve (months). The calculated totals are then ranked in order of magnitude. The middle value represents the full-time equivalent, projected, “statistical median of the average monthly gross remuneration”.

The LAG dismissed the complaint because it could not be concluded from the fact that the plaintiff’s remuneration was below the reported median of male comparative employees that the disadvantage in remuneration was due to gender. The BAG did not share the opinion of the LAG. With the information of the comparative remuneration as median remuneration, the employer also informs about the relevant comparative person. Accordingly, either a concrete or a hypothetical employee of a different gender receives this remuneration for the same or equal work. Thus, the fact that the plaintiff’s remuneration is lower than the median remuneration of the male comparison person disclosed by the defendant justifies the presumption that the discrimination is due to gender.

In case the plaintiff for discrimination succeeds in presenting indications showing an predominant probability of a disadvantage prohibited under the General Equal Treatment Act (Allgemeines Gleichbehandlungsgesetz – AGG), the employer bears the full burden of proof that the discrimination is not due to one of the reasons listed in sec. 1 AGG or is exceptionally permissible.

So far, only the press release on the BAG’s decision has been published. Considering the convincing argumentation of the LAG, the reasons for the decision of the BAG on the information value of the median and on the criteria for rebutting a presumed discrimination remain to be seen.

As usual, we will keep you informed about the latest developments in case law and legislation.

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