Germany’s Remuneration Transparency Act Proves Paper Tiger
Germany's Remuneration Transparency Act has hardly had any impact to date, according to a survey of German personnel managers conducted by the ifo Institute on behalf of Randstad Germany. This is due to the fact that only a few employees have made use of their new right to information.
As of the beginning of 2018, employees have been entitled to know the salary of a colleague performing similar activities and in a comparable position if s/he is of the opposite sex. To date, however, employees only obtained such information in just under 10 percent of all of the companies surveyed; and only sporadically even in such cases. Even if employees did request such information, this rarely had an effect, with only around one in seven information requests resulting in a salary adjustment.
Fears that the law would create discord among employees or cause excessive bureaucracy for companies have also proven unfounded. Only 4% of HR managers reported the law creating unrest in the workforce. For just under 90 percent of the companies surveyed, the bureaucratic workload also remained limited, with only one percent reporting a high burden. The law took effect in January 2018 for firms with 200+ employees.
