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Equal Pay for Work of Equal Value: A Comparative Analysis of EU and Maltese Law

By Aron Mifsud Bonnici, Partner


The principle of equal pay for work of equal value is a cornerstone of employment law within both the European Union (EU) and Malta. This principle ensures that individuals performing similar work are entitled to equivalent remuneration, thereby promoting fairness and reducing discrimination in the workplace. This article provides a comparative analysis of the EU and Maltese legal frameworks governing equal pay, assessing whether Maltese law is more comprehensive, particularly in its application beyond gender-related issues.



EU Legal Framework


The EU’s commitment to equal pay for work of equal value is enshrined in various legislative instruments and treaties. Article 157 of the Treaty on the Functioning of the European Union (TFEU) explicitly mandates that each Member State shall ensure the application of the principle of equal pay for male and female workers for equal work or work of equal value. This is reinforced by Directive 2006/54/EC on the implementation of the principle of equal opportunities and equal treatment of men and women in matters of employment and occupation.


Maltese Legal Framework


Maltese law also strongly supports the principle of equal pay for work of equal value, and it does so with a distinctive approach. Article 27 of the Employment and Industrial Relations Act (EIRA) states that employees who are in the same job category should receive the same pay if they are doing work of equal value.


Collective Agreement Exceptions: Employers and workers (or their unions) can negotiate different pay scales and employment conditions in collective agreements. This means: Workers hired at different times can have different salary scales and annual raises.

These scales must have a maximum limit that employees can reach within a set period.

Non-Discrimination: Any differences in employment classes that are based on discrimination and are not justified by the law are invalid and have no effect. This ensures that any distinction between employees must be lawful and not discriminatory.


So, while the general rule is equal pay for equal work, there are allowances for different pay scales if they are part of a negotiated agreement and follow certain rules. However, any discriminatory practices are not permitted.


Comparative Analysis


1. Scope of Application:

EU Law: Primarily focuses on gender equality, ensuring that male and female workers receive equal pay for equal work or work of equal value.

Maltese Law: Extends beyond gender issues, prohibiting discrimination on various grounds, including sex, sexual orientation, gender identity, age, disability, religion or belief, and racial or ethnic origin.


2. Comprehensiveness:

• The EU framework, while robust in promoting gender equality, does not explicitly cover other forms of discrimination within the specific context of equal pay for work of equal value.

• Maltese legislation is more comprehensive, providing broader protections against discrimination in pay beyond just gender. This inclusivity ensures that the principle of equal pay is upheld across a wider range of potential discriminatory scenarios.


3. Enforcement and Remedies:

EU Law: Member States are required to implement and enforce these principles through national legislation, and individuals can seek remedies through national courts and tribunals.

Maltese Law: Provides specific mechanisms for addressing grievances related to unequal pay through the Industrial Tribunal and other legal avenues, ensuring that individuals have practical means to enforce their rights.


Case Law


In the Grezzju Azzopardi vs Public Broadcasting Services Ltd case, the complainant, Grezzju Azzopardi, argued that his employer, Public Broadcasting Services Ltd (PBS), paid him less than other employees performing similar work, thus violating the principle of equal pay for work of equal value under Article 27 of the Employment and Industrial Relations Act (EIRA). Azzopardi claimed that despite performing duties equivalent to those of his colleagues, he was not receiving equivalent remuneration.


Decision:


• The tribunal found that Azzopardi’s duties were indeed equivalent to those of the higher-paid employees and that there was no objective justification for the pay disparity.

Decision: The tribunal ordered PBS to adjust Azzopardi’s salary to match that of his colleagues and awarded him compensation for the pay disparity he had suffered.


In the Roberta Spiteri vs ST Microelectronics (Malta) Limited case, the complainant argued that her salary was not on par with that of other employees performing similar work, thereby violating the principle of equal pay for work of equal value under Article 27 of EIRA. The court referenced the principles established by authors on equal pay for equal work, emphasising the need for transparency and fairness in wage structures.


Decision:


• The court of appeal and industrial tribunal found that the differences in pay were not justified by any objective criteria and constituted a violation of the equal pay principle.

Decision: A ruling in favour of Spiteri, ordering ST Microelectronics to adjust her salary and compensate her for the financial prejudice suffered due to the pay disparity .


Assessment


Maltese law can be considered more comprehensive in the context of equal pay for work of equal value due to its broader application. By not limiting the principle to gender discrimination, Maltese legislation offers a more inclusive and protective framework for all employees, regardless of the basis of potential discrimination. This reflects a progressive approach in aligning with contemporary understandings of equality and non-discrimination, ensuring that the workplace remains fair and equitable for all.


What new employee rights does the Pay Transparency Directive create?


The EU Pay Transparency Directive entered into force on 6 June 2023 and is expected to be transposed into national law by member states by 2026. This Directive creates new rights for employees covering:


  • “Pay transparency prior to employment” (a right to information on pay/pay range and a ban on asking about pay history).

  • “Transparency of pay setting and pay progression policy” (a right to information on pay criteria).

  • “Right to pay information about those performing “like work” and “work of equal value”” (a right to access to information about pay gaps in a worker’s category).

  • Ban on pay secrecy clauses.


Conclusion


Both EU and Maltese laws firmly uphold the principle of equal pay for work of equal value. However, Maltese law’s broader scope makes it a more comprehensive legal framework, addressing various forms of discrimination beyond gender. This inclusiveness is a significant step towards achieving genuine equality in the workplace, setting a benchmark for other jurisdictions to follow.


Aron Mifsud Bonnici is a partner specialising in employment law, with extensive experience in both Maltese and European legal frameworks. His work focuses on promoting fairness and equality in the workplace through informed legal practice and advocacy.


12th June 2024

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