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Equal pay for equal work


One company bucks negative trend on pay parity


By Sonia Fenazzi in Morges


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Overall, women in Switzerland earn CHF7.7 billion a year less than men, of which CHF2.9 billion is due to outright discrimination (Keystone)

Overall, women in Switzerland earn CHF7.7 billion a year less than men, of which CHF2.9 billion is due to outright discrimination

(Keystone)

Wage discrimination against women is still common in Switzerland. But paying workers what they are worth regardless of gender makes sense for the corporate world, says the CEO of one of the few Swiss companies to have been certified as “fair” in their pay policies and practices.

Switzerland provides the “best example” of a certification process for companies that address the gender pay gap, according to the European Commission in a 2014 document about achieving pay parity between the sexes. Since 2005, the “equal-salary” label has been awarded by Vevey-based foundation EQUAL-SALARY.

The foundation has set out to show, without divulging confidential information, that fair wages between the sexes is good for business as well as employees.

Among those certified are the Geneva-based World Economic Forum, host of the annual gathering of elites in Davos, and Romande Energie, the fifth-largest electric power company in Switzerland.

Certification takes from four to six months. A research institute at the University of Geneva analyses pay rates and a specialised international firm performs an audit. Any inequalities that are found must be eliminated for a company to earn the “equal-salary” label, which is valid for three years.

New legislation

The government wants draft legislation on pay parity by the middle of 2015. Results of a certification would be published in a company’s annual financial report. There would be an obligation to specify the amount of discrepancy in pay between women and men. And if discrimination was found and the company did nothing to fix it, the government would not necessarily intervene to force it to do so, either – it would be up to the people affected to take legal action.

“I must admit I did not think that the investigative process would go so far,” says Pierre-Alain Urech, director-general of Romande Energie, referring to a process involving detailed analysis of corporate documents and probing interviews with executives and other staff. “Anything I said, they wanted me to back it up with facts: minutes of meetings, regulations, pay certificates and so on.”

The CEO of the 750-strong company based in Morges says “there was a point where I was just about to explode, because I got the feeling that I wasn’t being believed, whereas every day for years we have been practising a policy of equality - and not just as regards salaries.”

Lack of will

Despite the enthusiasm in Brussels and in some Swiss circles for that investigative procedure, companies willing to subject themselves to it remain the exception in Switzerland. Since 2007, some 26 procedures have been carried out, resulting in 14 stamps of approval – some for banks, churches and communities.

Even a fairly mild measure pushed by the Swiss government and labour groups with the intention of encouraging participation by companies with at least 50 employees failed to impress the corporate sector. Just 51 of the some 10,000 companies in Switzerland signed up for it, and, of those, 36 were public sector employers.

In recent years, the pay gap between men and women in Switzerland has even widened at private companies, rising from 18.4% in 2010 to 18.9% in 2012, according to the Federal Statistical Office. 

The so-called “gender pay gap” varies from sector to sector. It ranges from between 6% and 32%, as can be seen from the chart below:

Switzerland does not exactly shine in international comparisons. Its gender pay gap, as shown in the next chart, exceeds the OECD average and that of neighbours Germany, France and Italy.

Experts say a significant portion of the pay gap cannot be explained objectively based on training, skills, experience or level of responsibility, but comes down to discrimination, pure and simple. Such discrimination amounted to 38% of the average pay gap between men and women in the private sector in 2010, according to the Federal Statistical Office.

Government to take action

The Swiss government, faced with these figures and a general lack of will among employers to improve the situation, is considering whether to require companies with at least 50 employees to have their pay parity compliance checked periodically. The bill is expected to be made public by mid-year.

Switzerland’s small business federation immediately let it be known it opposes outside controls that it views as “a costly and time-consuming bureaucratic activity”, but welcomes more dialogue. Similarly, the Swiss Employers’ Association calls the certification “a useless requirement” that amounts to “a vote of no confidence in business”.

Urech, of Romande Energie, says it is totally unfair that a woman should earn less than a man with the same skills and experience for doing the same job, but that doesn’t justify putting in place an outside verification process required by law.

“I think we should be appealing to the sense of responsibility of corporate management, without enforcing a blanket solution,” he says.

A matter of responsibility

What motivated his company to participate, he says, was a sense of social responsibility to staff and, more broadly, to society at large.

“As a matter of priority, we wanted an independent, neutral and rigorous process that would prove to our staff that one of the basic values proclaimed by the company is really being practised," explains Urech. “I believe that this is bringing us contentment and quality in our work, and it allays any tensions and suspicions.”

It also gives his company “an extra edge” in terms of its image that helps with recruiting, he says. Any company would benefit from such a process, he adds, “because people are more motivated – they lean in for the company".

Constitution disregarded for 34 years

The theme of International Women’s Day 2015 in Switzerland is pay parity. A coalition of women’s organisations, unions and political parties has planned a national demonstration for Saturday, March 7, on Parliament Square in Bern, to demand its implementation. In their view it is unacceptable that the principle of gender equality added to the constitution in 1981 and legislation approved in 1996 requiring equality of men and women are still not being applied systematically.

Swiss women in work

Switzerland still ranks among top ten OECD countries for women’s participation in the workforce according to the latest PricewaterhouseCoopers (PwC) Women in Work Index released on March 6. However, a slight increase in the gender wage gap (from 18% to 19%) compared to the year before resulted in the country dropping from 7th to 8th place overall.

At 78%, Swiss women’s participation in the workforce is the second highest, only behind Sweden. But the country has one of the lowest proportion of women in full time employment (54%). Only Netherlands (39%) fared worse.



(Translated from Italian by Terence MacNamee), swissinfo.ch



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