Finland Gender Pay Gap Reporting: What You Need to Know

To find the full text of the global pay reporting law in Finland, refer to Finland’s Act on Equality between Women and Men (609/1986).

The Ombudsman for Equality monitors compliance with the Equality Act, including gender equality plans and equal pay audits. Finland’s Ombudsman for Equality may require the employer to make the plan, setting a deadline by which the plan must be drafted. Should the employer fail to meet this deadline, the Ombudsman can take the matter to the National Non-Discrimination and Equality Tribunal for review. The Tribunal may fine the employer if a plan is not generated within a defined period. 

This may also change with the EU Pay Transparency Directive. Not only will the Directive require closing pay gaps that cannot be explained, there may be new penalties for non-compliance. The exact penalties will vary by Member State, but they are likely to be substantial and adjusted based on the severity and duration of non-compliance, with stricter penalties for repeated offenses.

Finland’s pay survey includes pay components like ordinary basic or minimum wage or salary and various supplementary allowances and performance-based bonuses. Syndio provides Global Pay Reports customers with a detailed explanation of all pay elements to include in the analysis.

The Gender Equality Plan (pay gap report) should include all workers who, by contract, perform work for the employer under the employer’s direction and supervision in return for pay or other remuneration. This applies to persons working in other legal relationships that are treated as employment relationships. Syndio provides Global Pay Reports customers with detailed guidance on which employees to include.

Two employees may be paid differently and this does not mean that there is any discrimination. Finland’s Ombudsman for Equality has indicated that there can be acceptable reasons for pay differences based on things like work experience, education, and performance. Syndio provides Global Pay Reports customers with detailed information on acceptable reasons for pay differences and whether an employer needs to take corrective action.

The pay gap requirement in Finland focuses primarily on gender. The reporting requirements and metrics are designed to assess and address the gender pay gaps within organizations. This will also be the case with the EU Pay Transparency Directive.

While the law doesn’t explicitly require reporting on race/ethnicity pay gaps, many organizations also analyse race and ethnicity gaps as part of their pay transparency strategy, where it is permitted by law. 

Syndio’s PayEQ solution allows you to analyse pay equity and opportunity gaps across multiple dimensions, including race, gender, ethnicity, age, disability, and more. This provides a comprehensive understanding of how different groups are affected by your policies and practices.

Syndio provides software and expert professional services to help companies comply with pay equity, pay reporting, and pay transparency regulations. Syndio helps you analyse, remediate, explain, and report on pay gaps so you can stay on top of compliance in Finland. Learn more: https://synd.io/global-pay-reporting/.

The law in Finland analyses pay gaps, not pay equity. What’s the difference?

An unadjusted pay gap (also called an “uncontrolled pay gap”) is the difference between the median or mean pay of two groups, such as men and women.

• Median pay gap: Imagine lining up all the earnings for two groups of employees (e.g., men and women) from lowest to highest. The median pay gap is the difference between the middle earnings in each line. It’s a good indicator of typical pay differences.
• Mean pay gap: This compares the average earnings of each group. However, it can be skewed by extremely high or low earners.

Pay equity, or the adjusted pay gap, accounts for factors that can legitimately explain differences in pay, such as performance ratings, tenure with the company, or location.

The median and mean pay gaps provide valuable insights, but they don’t tell the whole story. There may be legitimate reasons for pay differences between employees. The adjusted pay gap (pay equity) accounts for these factors, revealing whether a pay disparity truly exists (which is unlawful in many countries) so you can take corrective action. Syndio’s PayEQ software is the trusted solution for global enterprises to rapidly identify, address, and prevent pay disparities.