Some are preparing for it as if it were a big explosion, others were not even aware of it. Companies will soon have to comply with salary transparency. More precisely, a European directive foresees a series of measures to try to reduce wage inequalities between men and women (which currently amount to 14% in equal working hours). It must be transposed into French law by June 2026 and should affect companies with more than 100 employees.
First point, employers must show a salary range in job offers (or at most before the first interview). “I have certain bosses who tell me that they want to cheat, that they want to do like Netflix in the United States by setting a range between 50,000 and 100,000,” says Sandrine Dorbes, a compensation expert who advises several companies on salary transparency. But he strongly advises them against adopting this risky strategy, both from a legal point of view (they could be sanctioned) and from an image and employer brand point of view.
Know how much your colleagues earn (on average)
Another arrangement risks having the effect of a bomb in open spaces. Employees may request from their employer an average of the salaries of their colleagues who perform “the same work or work of equal value.” Unjustified deviations greater than 5% must be analyzed and corrected. And there are many fears.
“Perhaps this will lead to resignations, in any case, the risk is that there will be a peak of demotivation and disconnection for those who will find out that they are paid less than their colleagues,” he warns.
“Managers do not want to implement this reform because they fear that employees will not agree, they fear opening Pandora’s box,” testifies Sandrine Dorbes.
“They are also afraid of tensions between employees. I remember a team of four people who did the same job but with four very different salaries, when they found out, the team exploded,” he says. “But don’t panic, it can also turn out well,” says the specialist, “as long as you prepare now.”
“For SMEs it is really complicated”
The first step that companies must take is to take stock of the situation and create, if they do not already exist, job categories. “Cleaning and labeling data involves a lot of work, especially when it comes to jobs,” explains Sandrine Dorbes. “For example, ‘project manager’ can correspond to very different positions and levels of responsibility.” But for small businesses, this work can be daunting.
“At Mousline we are lucky to already have templates and job classifications,” explains its president Philippe Fardel, who bought the company from Nestlé three years ago. “We bought the company from a structured group that had the means, so the processes were already underway, in particular the work of labeling the stations and building the racks with bands of approximately 10%,” explains the head of the 180-employee puree company.
Christophe Winkelmuller, vice-president of the CPME in Alsace, even admits it: he was not aware of this new directive. Your small business of 12 employees is certainly not affected, but you are concerned about the administrative overload for those (100+ employees) who will have to comply. “I really recommend that HR managers of SMEs negotiate an HR IS (information system) with their managers. If everything is done in Excel or Google Sheets, the risk of error increases and it takes a lot of time,” suggests Julien Martino, who was HR director of a startup in the past.
“These are painful discussions.”
It is then a matter of defining a remuneration policy. To do this, companies must ask themselves what they want to reward: seniority, responsibilities, skills, etc. Several options are available to you. Therefore, the European directive does not prohibit paying your employees differently. The selection criteria will simply have to be objective and transparent. “Although sometimes we do not want to explain it, even if it is justified, these debates are painful,” emphasizes Sandrine Dorbes.
But what about deviations that are not justifiable? “Sometimes raises are granted arbitrarily, to those who hit the table with their fist, historically mostly men. And those who don’t ask for anything, receive nothing,” says Julien Martino. Therefore, these gaps will need to be resolved.
“The other employees won’t understand…”
But some cases are more delicate and risk creating problems. In particular, in the hiring of professions under tension for which it is easier to align with the requested salary, due to a lack of candidates. “There are special cases, for example in the maintenance sector, where we have difficulties recruiting and that is why we offer a higher salary,” confirms Mousline boss Philippe Fardel.
“On the other hand, perhaps we have to do requalification work at the level of the grids, if we cannot hire with this salary it is perhaps because we have to move to the higher band, it is an adjustment work that we do every 18 months,” he testifies.
“If I employ four people in cybersecurity, for example, and two leave, I will have to replace them. As it is a sector in tension, candidates could ask for 20% higher salaries and we will be forced to accept,” adds a remuneration director of a multinational in the cosmetics sector. “I will also raise the two who stayed so they don’t leave, but with limited budgets, usually not so much.”
Start closing the gaps now
Some companies have already begun to close the gaps. For the individual increase campaign that is underway, Julien Martino from Reckitt asked local officials not only to reward performance, but also to eliminate unjustified differences.
It also relies on the variable part to reward performance. “Previously, the variable part was awarded based on your collective performance; starting this year, 30% of the variable is paid based on your individual performance,” he explains. “We have to start being compliant now,” explains the HR director, who anticipates “a cold financial shower for companies.”
Source: BFM TV
