Pay Equity

France — Gender equality index

June 12, 2024•eGuide

A photo of the French flag with a blue sky in the background.

Local requirement

France

For companies operating in France, this article provides information on pay equity reporting and associated legal requirements. This includes what the requirements are, what employers are subject to them, what steps to take, and how PayAnalytics by beqom may help.

Local reporting requirements in France

France’s current pay gap reporting requirement was introduced in 2018 and rolled out gradually. The required report (Index de l’égalité professionnelle femmes-hommes) is known as the “gender equality index” in English.

The goal is to provide a simple, reliable, and practical way to end gender pay inequity. Companies must not only publish pay gap information, but also document the measures they are taking to close the gap. The report also looks at the specific impacts of gender differences. For example, it is designed to detect whether employees who take maternity leave get raises at the same rate as those who do not. This helps detect any ingrained bias against working mothers.

Today, all organizations with 50 or more employees have to publish their gender equality index every year before March 1. Companies who have employed 1,000 or more people for three or more consecutive years have an additional requirement. They must calculate and publish any gaps in gender representation among their executive managers and members of their governing bodies. This report is also due annually by March 1.

Requirements

The report must include four or five specific indicators, depending on company size. Each indicator has its own numerical value. When added together, the indicators yield a total gender equality index between 1 and 100. All employees should be included in all indicators, with one exception. Employees who have been on maternity leave for more than six months and returned during the reference period should only be included in the fourth indicator.

The indicators are:

The gender pay gap within comparable jobs and age groups. This indicator has the highest value and can contribute up to 40 points to the index.
Difference in individual raises between men and women in comparable jobs. 35 points for companies with 50-250 employees, 20 points for those with 250+ employees.
Difference in the promotion rate between men and women in comparable jobs. This indicator is only required for companies with 250+ employees and can contribute up to 15 points.
Employees receiving raises when returning from maternity leave. 15 points.
Gender distribution among the 10 highest paid employees. 10 points.

With just a few clicks, PayAnalytics by beqom allows users to create a complete Excel report for the French gender equality index. This report matches the official template on the government’s website (under “Comment calculer votre Index”).

PayAnalytics by beqom automatically performs all necessary calculations:

Using the relevant indicators and weighting based on the organization’s size
Necessary groupings of employees (for indicators 1-3)
Measuring which groups are valid and scaling the indicator if needed
Excluding employees who were on maternity leave for more than six months from other indicators

To get started, users should be ready to provide data files with columns for the following:

Gender, age and salary
The employee’s job. (If necessary, PayAnalytics by beqom allows you to map job roles to four socioeconomic categories defined by the French government.)
Designations for employees who received raises, promotions and/or returned from maternity leave.

What happens next

Organizations must submit their index to the Ministry of Labor through an online form. It should also be made publicly available, identifiable, and accessible on the organization’s website. Specifically, it must be posted no more than two or three clicks away from the main page.

Each employer must also present the index internally to its Social and Economic Committee (CSE). This should take place their first meeting after the publication of each year’s index. This meeting should deliver an in-depth presentation on each indicator and also the data relating to any incalculable indicators. (See further details here (Question I).)

The goal is to have a total index (sum of all relevant indicators) of 85 or higher.

If the total index is below 85, the following actions are necessary:

On its website, the organization has to publish its development goals for each indicator where the maximum score is not reached. This information must remain available there until the goals have been reached.
Organizations must submit the same information to the Ministry of Labor and to their CSE via BDESE (the economic and social database)

In addition to all the above, organizations with a total index below 75 have further requirements:

Define their goals and corrective measures for each indicator through a collective agreement or a unilateral decision, which should have been filed on Téléaccords
Consult with their CSE for approval
Internally inform their employees of the goals and corrective measures
Publish the goals and corrective measures

There are financial penalties for non-reporting, substandard reporting, or non-implementation of corrective measures. This includes failure to make the reports adequately visible and readable online. It also includes corrective measures that are implemented, but inefficient. Penalties can be up to 1% of the company’s annual payroll. There is also a penalty for failure to improve the index score within three years. The penalty here will be proportional to the efforts the organization made to improve its index.

Further support in PayAnalytics by beqom

PayAnalytics by beqom provides an easy and streamlined way for users to create reports that meet the legal requirements in France. But the platform also helps companies go further on their pay equity journeys with the following features:

Pay equity analyses: This tool not only measures the adjusted pay gap but also provides suggestions (specific raises for specific employees) on how to close it.
Workplace equity feature: This tool gives an overview of the diversity in an organization’s workforce composition. Understanding workforce diversity is key to understanding why an unadjusted pay gap might exist. This tool also shows how the organization’s workforce is changing.
Compensation Assistant: Once the pay gap is closed, this tool helps ensure that it does not come creeping back through promotion or new hire decisions.
Drill-down capabilities: Insight into specific groups of employees, like those in comparable jobs or those that have been on maternity leave, helps employers get a better understanding of their pay structure.