France to fine companies for not fixing their gender pay gap

Firms will have to instal software directly linked to their payroll systems to monitor unjustified pay gaps

Men are on average paid 9 per cent more than women in France (AFP/Getty)

France’s Prime Minister has proposed plans to fine companies that do not close their gender pay gap within three years.

Edouard Philippe on Wednesday told unions and employers about the plans, under which French companies with more than 50 employees will have to instal software directly linked to their payroll systems to monitor unjustified pay gaps.

The government said it was aiming to roll out the software in companies with more than 250 employees next year, and in 2020 for firms with between 50 and 249 staff.

If unjustified gender pay gaps are detected and not corrected within three years, labour inspectors will have the power to impose fines of up to 1 per cent of the company’s total wage bill.

“The software is not a magic wand, but it will reveal certain differences in the pay between men and woman,” Mr Philippe told journalists after meeting with unions and employers.

Men are on average paid 9 per cent more than women in France, even though the law has required equal pay for the same work for the past 45 years, which is roughly on par with the gender pay gap for full-time work in the UK.

Under legislation introduced last year, all UK companies employing at least 250 people have until early April to publish their gender pay gaps, broken down by seniority level.

The French government said that its plans, the details of which are still being finalised, also include greater transparency requirements for reporting publicly on the gender pay gap.

Additional reporting by news wires