Top German labor court boosts equal pay procedure for women

February 17, 2021
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The executive, who managed a department within a public insurer in Hanover, had used Germany’s relatively new pay-transparency law, which requires employers to disclose male colleagues’ wages or salaries.

The Federal Labor Court ruled that her earning €1,006 ($1,218) less per month than the median compensation, in terms of basic salaries and bonuses, of six male colleagues in comparable positions was an indicator of gender discrimination.

Despite narrowing gradually, gender pay discrepancies in Germany persist

Furthermore, BAG placed the burden of proof on employers to show that gender was not the factor behind a woman’s lower pay.

The case now goes back to Hanover’s regional labor court, where the insurer, facing the presumption of gender discrimination, can still argue that other factors, such as training and experience, had led to the men’s higher compensation.

The employer is the Landschaftliche Brandkasse Hannover, a public insurer that started in the farming sector in the 18th century.

Statistics of recent years show that women in Germany earn about 20% less than their male counterparts.

Simplifies procedure

The acting head of Germany’s federal anti-discrimination agency, Bernard Franke, said the ruling would simplify proceedings in equal-pay cases by putting the burden of proof on employers.

Germany’s 2017 transparency law allows an individual employee within a firm of more than 200 personnel to require employers to calculate the median pay from a comparable group of at least six similarly qualified colleagues of the other gender.

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