To identify pay differences by worker category, first place workers into defensible categories representing the same work or work of equal value using objective, gender-neutral criteria. For each category, calculate or obtain the average pay level for female workers and for male workers, review complementary or variable components, and quantify the difference between the two groups. Article 10 requires these differences to be identified for each category. A difference of at least 5% in average pay level is the first condition in the joint pay assessment trigger, but any identified difference should then be examined for objective, gender-neutral explanations and, where unjustified, corrective action.
Jurisdiction: European Union
Start With Defensible Categories of Workers
The analysis depends on how workers are grouped. The Directive defines a category of workers around workers performing the same work or work of equal value, grouped in a non-arbitrary manner using objective, gender-neutral criteria. Employers should therefore avoid categories created merely to make the resulting gap smaller or to mirror inconsistent legacy job titles. Relevant work-of-equal-value factors under Article 4 include skills, effort, responsibility and working conditions, along with other factors relevant to the specific job or position where appropriate.
Build a Sex-Disaggregated Pay View for Every Category
For each category, the joint pay assessment requires the proportion of female and male workers and information on average female and male pay levels and complementary or variable components. The analysis dataset should therefore preserve at least the worker category, sex, relevant pay level and relevant complementary or variable pay information. Employers operating multiple payrolls should reconcile coding and definitions before comparison so that the same type of compensation is treated consistently across the category.
Calculate the Difference Within Each Category
Article 10(2)(c) requires any differences in average pay levels between female and male workers in each category of workers. The employer should therefore compare the category-level female average with the corresponding male average and preserve the underlying figures used in the comparison. The assessment should not rely only on an employer-wide gender pay gap because broad workforce composition can hide material differences within comparable groups. National methodology may provide additional instructions on operational calculation details.
Flag Categories That Meet or Exceed the 5% Threshold
Article 10(1)(a) uses a difference of at least 5% in average pay level between female and male workers in any category as the first mandatory-assessment trigger condition. Where an employer is already conducting the joint assessment, categories meeting or exceeding that threshold deserve clear attention in the analysis. The 5% figure should not be confused with a safe harbour: a smaller difference can still warrant review under the equal-pay principle, while the Article 10 trigger also requires lack of objective justification and failure to remedy within six months.
Separate Detection From Objective Justification
A numerical difference is a finding, not automatically a conclusion of discrimination. Article 10 requires the reasons for category-level differences to be examined on the basis of objective, gender-neutral criteria and, in the joint assessment, established jointly by the employer and workers' representatives. The analysis should therefore first identify the difference accurately and only then test possible explanations against documented evidence. Mixing those two stages can make it difficult to distinguish a genuine justification from an assumption introduced to explain the result after the fact.
Unjustified Differences Should Feed Directly Into Remediation
Article 10 requires measures to address differences that are not justified on the basis of objective, gender-neutral criteria. Once an unjustified difference is identified, the employer should trace the cause before choosing a corrective measure. The issue may involve individual pay decisions, progression practices, variable compensation, job evaluation, classification or another structural feature. The assessment should document which categories are affected, the evidence supporting the finding, the selected measure and how effectiveness will be reviewed.
Frequently Asked Questions
Should pay differences be analysed by job title only?
Not necessarily. The Directive uses categories of workers based on the same work or work of equal value and requires objective, gender-neutral grouping rather than reliance on job titles alone.
Does a category-level difference automatically prove discrimination?
No. The difference must be examined for objective, gender-neutral explanations. Unjustified differences require corrective action.
Is the 5% threshold based on the employer-wide gap?
No. Article 10 applies the 5% condition to the difference in average pay level within any category of workers.
Related Guides
Official Sources
Requirements and practices differ by jurisdiction and organisation. Check current local law, official guidance and professional advice for a specific situation.