New legal measures to promote equal pay between men and women

Portugal - 

Labor and Employment Law Portugal Alert 17-2018

It was published today in the Official Gazette, Law no. 60/2018, of 21 August, establishing new measures to promote equal pay between men and women for equal work or work of equal value. 

These measures consist mainly on disclosing information, detecting and correcting any salary inequalities or discrimination between men and women, with the participation of companies and several public authorities. 

The following aspects are to be highlighted:

1. Implementation of a transparent Salary Policy by the companies 

Companies shall implement a transparent Salary Policy, applicable to all employees, to detect, prevent and eliminate cases of salary discrimination between men and women. 

The Salary Policy shall be designed further to an evaluation of all the elements of the tasks rendered by the employees, based on objective criteria (such as merit, productivity, absenteeism or seniority), common to men and women.

In case of any claim on salary discrimination, it is up to the company to demonstrate that a Salary Policy is in force in the company, and that such Policy governs the claimant’s salary and the salary from whom he/she considers to be discriminated against.

2. Disclosure of statistical information by the Labor Ministry

On the first semester of each year, the services responsible for carrying out statistical analysis for the Labor Ministry shall disclose statistical information on salary inequalities: 

  • General and by sector;
  • By company, by profession and by employee's qualification level.

This information will be sent to Labor Authorities, so that any detected case of salary difference between men and women based on gender can be investigated.

3. Intervention of labor authorities

Up to 60 days after the reception of the statistical information, if any case of salary difference between men and women is detected in a company with more than 250 employees, the Labor Authorities (“ACT”) notifies the company to provide an assessment of the detected salary differences and a plan of action. 

The abovementioned assessment and plan of action: 

  • Must be submitted by the company within 120 days further to ACT’s notification;
  • Is implemented by the company for a 12 months period;
  • Is designed on the evaluation of all the elements of the tasks rendered by the employees, in order to eliminate any discrimination based on sex.

At the end of the 12 months period of the plan of action, the company communicates to ACT its results, indicating any justified salary differences and the elimination of any unjustified salary differences.

If any detected salary difference remains and is not corrected or justified by the company, such differences are presumed to be discriminatory.

At the third year that this new Law is in force, the obligation to implement assessment of detected salary differences and plans of action becomes mandatory to companies with more than 50 employees.

4. Intervention of public Commission for Employment Equality 

From 21 August, 2019, onwards any employee or union representative may request Portuguese Commission for Employment Equality (“CITE”) a report regarding the existence of salary discrimination based on sex for equal work or work of equal value. 

The request must be presented in writing with facts that sustain the claim of salary discrimination, indicating the employee or employees of different sex in relation to whom the applicant considers to exist a case of discrimination.

Upon receiving the request, in the following 10 days CITE notifies the company to, within 30 days, provide its response to it and disclose information on:

  • Company’s Salary Policy;
  • The criteria used to calculate the remuneration (i) of the employee mentioned in the request and (ii) the employees of different sex in relation to whom the applicant considers to exist discrimination.

If the company fails to disclose this information within the 30 days period, it is considered that salary discrimination exists.

If the CITE preliminary report considers that salary discrimination exists, in the following 180 days, the company shall communicate to CITE the measures implemented to eliminate the detected cases of salary discrimination.

After the 180 days period, CITE issues its final report, legally binding, which is notified to the applicant, to the company and to ACT.

Any dismissal, as well as any other disciplinary penalty, allegedly due to disciplinary infraction, is considered unfair if it occurs within one year after the CITE’s report is requested. 

5. Intervention of Labor Courts

Labor Courts will be obliged to communicate immediately to CITE any final decisions in which an employer is convicted for salary discrimination based on gender.

6. Company’s Social Report

The Social Report filled and sent annually by the companies to the labor authorities will have to include nominative information for each gender.

The employer will be obliged to disclose to the employees the data included in the company’s Social Report.

7. Entry into force

This law enters into force on 21 February, 2019.