France Gender Pay Gap Reporting: What You Need to Know

To find the full text of the global pay reporting law in France, refer to France’s Gender Equality Index Law, the Supplement to Gender Equality Index Law (2021), and the Rixain Law (for companies with 1,000+ employees).

Penalties under the Gender Equality Act in France are steep and significant. If an employer does not publish results (overall and for each indicator) in a visible and legible way, the company is liable to a financial penalty of up to 1% of its annual payroll. This penalty can also be applied to companies if they do not set progress targets for each indicator if the overall score is less than 85, or fail to publish corrective measures if the overall score is less than 75.

Note that only companies with over 50 employees that received credits under the “Recovery Plan” can be penalized for not setting progress targets for each indicator or for not publishing those targets and the corrective measures. You should consult with legal counsel to ensure your organization understands and complies with all reporting obligations.

Generally speaking, the Index is calculated at the level of each company constituting a legal entity — though you should consult your legal counsel as it applies to your organisation. When the company has several establishments, the calculation of the indicators is carried out at the level of the company, and not of the establishment. When several companies form a group, the indicators must be calculated at the level of each company making up the group.

If there is an Economic and Social Unit (called a “UES”) recognized by collective agreement, or by court decision between several legally distinct companies, the indicators are calculated at the level of the UES.

If an UES with 50+ employees has been recognized, it is subject to the obligation to calculate the Index, regardless of the size of the companies that make it up. For example, an UES comprising three companies, with 100, 80, and 20 employees respectively, is subject to the obligation to calculate the Index. The workforce accounted for in the calculation of the Index will then be the total headcount of the UES. On the other hand, the obligation to publish the Index rests with each company, and not the UES.

Employees covered in the Gender Equality Index report include full-time and part-time employees, home workers, employees with a fixed-term or intermittent employment contract, and others

There are some exceptions for who should be included in the report. Syndio provides Global Pay Reports customers with detailed guidance on which employees are excluded.

The pay gap requirement in France 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 France. Learn more: https://synd.io/global-pay-reporting/.

The law in France 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.