EMPLOYER ACTION CODE: ACT

Decree-Law 6/2019 (“on the urgent measures to guarantee equal treatment and opportunities for women and men in employment and occupation”) contains various provisions to promote equal treatment and improved balance between work and family life for the private and public sectors. The legislation includes new measures to promote equality between men and women in the workplace and will gradually increase statutory paternity leave to 16 weeks by 2021.

KEY DETAILS

Some of the more significant provisions of the law, effective March 8, 2019 (unless otherwise noted), include:

  • Extension of the existing obligation to implement a workplace equality plan to companies with 50 or more employees (previously 250 or more employees). As part of the development of the plan, the employer must prepare an audit of the company’s gender status in consultation with employees’ legal representatives (i.e., the works council, union or other representative) covering issues including salary audits based on gender, access to employment, representation of women, professional classifications and promotions, training, working conditions and prevention of sexual harassment in the workplace. All equality plans will have to be posted to a public registry (under development).
  • The deadline for companies to develop equality plans (if they haven’t done so already) depends on its workforce size as follows:
    • One year (by March 7, 2020) for companies with more than 150 employees
    • Two years (by March 7, 2021) for companies with more than 100 employees
    • Three years (by March 7, 2022) for companies with 50 or more employees
  • All companies subject to the law (including companies that already have equality plans) are required to develop wage registries showing average pay levels disaggregated by gender and, in addition, one of three options: (1) professional group and/or category, defined by collective bargaining agreement in most cases; (2) equal jobs, i.e., job title, functions; or (3) work of equal value, as defined in the new decree. The registries must be made available to the workers’ legal representatives for review. The employer’s wage registry must justify any differences between average pay by gender of 25% or more.
  • Effective April 1, 2019, the provisions of the labor code for paternity leave will be amended to (eventually) provide 16 weeks of leave by 2021. The requirement for employers to provide two days of paid paternity leave for the birth of a child will also be abolished on the same date. The provisions are intended to align the duration of maternity and paternity leave, but the existing levels and durations of pay replacement benefits from social security for such leaves are unchanged. For new fathers, this means that they will be able to take up to eight weeks of paternity leave in 2019, 12 weeks in 2020 and 16 weeks starting in 2021, but only the first five weeks of leave will be covered by the social security paternity allowance.

The law also includes provisions for parents with children under the age of 12 months to request adaptation of working hours or other accommodations to improve work/life balance; enhanced employment protections for employees returning from maternity, paternity, adoption or guardianship leave; and pregnant employees during the trial period of employment.

EMPLOYER IMPLICATIONS

Employers subject to the equality plan obligation (i.e., those with 50 or more employees) should begin to monitor and ensure their compliance over the three-year transitional period (as applicable). Failure to establish an equality plan can result in significant financial penalties for the employer. It will also be necessary to review reward management and pay policy practices to ensure pay is fair and justifiable and to actively address any potential pay disparities across professional category and gender. Some of the practical details pertaining to the establishment of wage registries have yet to be disclosed by the government (e.g., the compliance due date, the specific methodology that employers must use to calculate the results and internal/external reporting processes) but are expected going forward.