Large companies in Switzerland will have to analyse wages of men and women starting in 2020 and make the audited results available to staff in 2021.
The Federal Council agreed on Wednesday that the equal pay revision to the Gender Equality Act, passed by parliament in December 2018, will come into force on July 1, 2020. Companies will have one year to publish a gender pay gap analysis audited by a qualified specialist.
The law affects firms with 100 or more employees. Although this applies to less than 1% of companies in Switzerland, they employ 46% of workers.
The analysis must be conducted every four years, unless the company shows no inexplicable wage gap between men and women in the first assessment. However, no sanctions will apply for companies with remaining pay gaps.
Employers are not required to publish the results externally but must share them with employees. The requirement is valid for 12 years – until July 2032 when the law is set to expire.
The government is also required to perform gender gap analyses, which have been performed twice so far: in 2013 and 2018.
The law was highly contested in parliament. The Federal Council supported a more ambitious proposal covering companies with 50 or more employees and without an expiration date.
Gender equality activists and left-wing parties celebrated the passing of the law while conservative parties argued the revision to the law to be excessive.
Several other countries including the UK have mandatory gender pay gap reporting, considered a step towards eliminating gender discrimination.
Women in Switzerland earn about a fifth less than men, according to the Federal Equality Office. This means every woman loses out on an average of CHF600 ($625) a month.
The International Labour Organization recently ranked Switzerland near the bottom of the list when it comes to the gender wage gap in senior roles.