The Government of Spain, on the occasion of the Day for Salary Equality In February, published an institutional declaration, expressing commitment to eradicating the gender pay gap, which reaches 21.4% according to INE data. The government is now presenting new legislation to tackle gender inequality in salaries. With the aim of increasing transparency in pay rates and equal pay for genders, from 14 April 2021 it will be mandatory for companies, regardless of their size, to produce and maintain a remuneration register, in which companies analyse and collect the criteria used to determine the wage remuneration of employees. This is a legal requirement to ensure jobs of equal value have the same salary.

This register, marked RD 902/2020, shall be made available for Inspection by the Ministry of Labour, which may request it at any time with a reference period of one calendar year. The inspection may be sanctioned in the event of non-compliance.

For now, the level of requirement and flexibility that an inspection will have is unknown, since there are no criteria given in the order. In any event, Article 10 of RD 902/2020 provides that the absence of paid registration may give rise to administrative and judicial actions and/or the application of penalties for discrimination.

Companies that do not produce a remuneration register could be sanctioned, as established by the regime of the Law on Infringements and Sanctions in the Social Order –  LISOS  (RDL 5/2000 of 4 August). Firms should be aware that wage discrimination is considered a very serious infringement, the penalty for which has associated fines ranging from €6,251 to €187,515.

As a summary, the salary information to be contained in the remuneration register, pending a final format requirement by the government:

  • Total annual salary and gender gap of this concept.
  • Annual base salary and gender gap of this concept.
  • Annual salary supplements and gender gap of this concept.
  • Extra-salarial allowances and gender gap of this concept.
  • Annual payments for overtime and complementary hours and gender gap of this concept.

Each of them must be broken down by professional category, professional group, workplace and must also indicate the arithmetic mean and the median of what is actually perceived by each professional group, category, position.

In order to comply with this new legal requirement, firms must:

  • Review their remuneration concepts.
  • Reconcile jobs and categories for the determination of analysis.
  • Analyse the data and make calculations as required to produce the remuneration report.
  • Prepare a general diagnostic report with the results obtained, following the legal requirements.
  • Identify possible inequalities in the wage register with detailed information of any bias so that the company can proceed with its justification, or resealing if applicable.

Auxadi’s Payroll department can support you in this new aspect of compliance for companies with activity in Spain and that will be affected by this regime. Just get in touch if you’d like help or assistance.

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Founded in 1979, Auxadi is a family-owned business working for multinational corporations, private equity funds and real estate funds. It’s the leading firm in international accounting, tax compliance and payroll services management connecting Europe and the Americas with the rest of the world, offering services in 50 countries. Its client list includes many of the top 100 PERE companies. Headquartered in Madrid, with offices in US and further 22 international subsidiaries, Auxadi serves 1,500+ SPVs across 50 jurisdictions.

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María Jesús Álvarez Almería
Payroll Management Services Director

All information contained in this publication is up to date on 2021. This content has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this chart without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this content, and, to the extent permitted by law, AUXADI does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this chart or for any decision based on it.