Employers Push Back on EU Pay Transparency Rules

Employers Push Back on EU Pay Transparency Rules

The German employers’ association, the BDA, is urgently pressuring the federal government to resist further modifications to the EU directive on pay transparency in the final stages of its implementation. Steffen Kampeter, CEO of the BDA, told the Redaktionsnetzwerk Deutschland that the government now faces a doubly demanding task: safeguarding against presumptions of misconduct regarding social partners while ensuring the protection of collective bargaining autonomy, mirroring the safeguards currently enshrined in Germany’s existing Pay Transparency Act. He stressed the necessity of advocating for a substantial reform of the directive at the European Union level.

The government aims to transpose the EU Pay Transparency Directive into German law by June 7th, with the stated goal of reducing the gender pay gap through increased transparency in salary negotiations. This ambition, however, is drawing sharp criticism from the BDA, which warns against undermining the principle of collective bargaining during the transposition process.

Kampeter cautioned that weakening collective bargaining agreements – which he asserted effectively guarantee equal pay for women and men – risks not only their legal validity but also erodes the entire system of tariff autonomy. He further warned that actions challenging these agreements are indirectly encouraging circumvention of collective bargaining agreements. He sharply criticized any proposals suggesting such a course of action, particularly given concurrent calls for strengthening the commitment to collective bargaining.

The BDA’s intervention underscores a growing tension between the EU’s aims for gender equality and the concerns of German industry regarding the potential disruption of established labor relations and the weakening of a system built on negotiated agreements. The debate highlights the complex political calculus involved in reconciling European directives with national industrial practices and raises questions about the government’s ability to balance these competing priorities.