Transparency in Wage Structures Act

The Transparency in Wage Structures Act (Entgelttransparenzgesetz), enacted in Germany in 2017, aims to promote gender pay equality by ensuring equal pay for equal work. It prohibits direct or indirect discrimination based on gender regarding all pay components and supplements the General Anti-Discrimination Act (AGG) of 2006. Key provisions include an individual right to information for employees in companies with over 200 staff, allowing them to request explanations for their compensation starting January 2018. This right applies only if at least six comparable employees exist, and requests are made through works councils or directly to employers.

Employers with more than 500 employees must report on gender equality measures every three to five years, detailing actions taken and reasons for inaction, with reports published in the Bundesanzeiger. The law encourages voluntary reviews of pay structures but faced criticism for its thresholds and voluntary nature. Critics argued it may not effectively address pay disparities due to fear of retaliation and limited usability of reported data.

In 2021, the Federal Labour Court ruled that paying female employees less than the male median in comparable roles creates a presumption of discrimination. Despite these measures, the law's impact has been limited, with many employees hesitant to exercise their rights and companies making few fundamental changes.