Swiss companies must start accounting for unequal pay

Women in Geneva demonstrating for gender equality at the women's strike on June 14, 2020 Keystone / Magali Girardin

After the amended Gender Equality Act comes into force on July 1, Switzerland’s largest companies will have one year to report any gender pay gaps.

The law applies to firms with 100 or more employees. Although this currently means under 1% of companies in Switzerland, it accounts for 46% of the Swiss workforce. The Federal Council had wanted to include companies with 50 or more employees, but parliament decided to focus on larger firms.

If an audit reveals inexplicable wage gaps between female and male employees, the company will have to repeat the analysis every four years. Companies do not have to publish the results publicly, but they do have to share them with their employees. However, there will be no sanctions for pay gaps.

Added to the constitution in 1981, the Gender Equality Act enshrines the principle that equal work deserves equal pay. In 1996, the Equal Opportunities Act came into force. It’s supposed to ensure equality in working life while prohibiting all forms of discrimination.

However, women in Switzerland still earn less than men. According to the 2018 Wage Structure Survey, the wage difference averaged 12.5%. For the private sector, the survey calculated a difference of 14.6% based on median wages.

The new policy of conducting pay gap audits will be reviewed in 2029 and is set to expire on July 1, 2032.