Global labor and employment law strategic topics

DE&I — Diversity, Equity & Inclusion

July 2021 Edition #2

In this issue, we focus on: DE&I — Diversity, Equity & Inclusion (July 2021)

Editorial 4 Romania 29

Argentina 6 Russia 30

Australia 7 Singapore 31

Brazil 8 South Africa 32

China Mainland 9 Spain 33 Colombia 10 Sweden 34 Costa Rica 11 Switzerland 35 Czech Republic 12 United Kingdom 36 Finland 13 Contacts for Labor and France 14 Employment Law services 38

Georgia 15 Recent EY publications 40

Germany 16

Greece 17

Hong Kong 18

India 19

Italy 20

Japan 21

Lithuania 22

Luxembourg 23

Netherlands 24

New Zealand 25

Norway 26

Peru 27

Poland 28 Editors’ letter Corporate reporting includes Environmental, Social and Governance (ESG) reporting. This trend to measure the health of an organization, not only through financial and economic measures, but also through non-financial indicators, is key to assess a company’s value for investors and shareholders today. As with CSR (Corporate Social Responsibility), organizations need to demonstrate sustainability and good corporate citizenship as measured through ESG reporting. The Social aspect of ESG includes inter alia working conditions, health and safety, employee relations, and DE&I: Diversity, Equity & Inclusion.

Together with ESG reporting needs, countries around the world understand that incentives and binding legal measures are needed to achieve gender parity and generally, greater diversity, equity and inclusion in the workplace. For this reason, many countries are passing legislation to ensure non-discrimination laws are in place, and also requiring companies to measure and report on Diversity, Equity & Inclusion. Indeed, as the Head of the European Central Bank, Ms. Christine Lagarde, stated in March 18, 2021 before the French National Assembly, it would take 140 years before parity between men and women is achieved if nothing further is done.

In this edition of EY’s Global labor and employment law strategic topics publication, we survey the laws in 31 countries relating to DE&I.

Roselyn Sands Paula Hogéus EY Global Labor and Employment EY Global Labor and Law Markets Leader Employment Law Leader [email protected] [email protected] Argentina Javier Sabin

DE&I in the working Argentine Employment Contract Law Latest reviews No. 20,744 governs employment environment In 2020, a hiring quota for transgender relationships in the private arena, people was set through Presidential Same-sex marriage was approved in 2010 establishing workers’ basic rights. Decree No. 721. It aims to ensure that in Argentina, making it the first country in Section 17, Employment Contract Law, at least 1% of all civil servants are Latin America to allow gay couples to wed. prohibits discrimination between workers transgender people. Two years later, the Gender Identity Law on the basis of sex, race, nationality, Furthermore, Presidential Decree No. was one of the most progressive pieces of religion, political opinion, union or age. 191/2021 introduces an incentive for legislation enacted worldwide. Section 172, Employment Contract Law, companies located in some provinces in Interest in diversity has been gaining recognizes women’s full capacity to enter northern Argentina that increases the momentum since then, in line with global into all type of agreements, and equal pay payroll for hiring women or transgender events, with initiatives in the corporate to men and women who perform jobs of people by reducing employer social and public sectors. equal value. security contributions up to 80% during The Argentine Ministry of Women, Moreover, Law No. 26,485 on the first 12 months, 55% the following Genders and Diversity was recently Comprehensive Protection for Women, 12 months and 30% the last 12 months. created to implement policies that foster enacted in 2009, establishes that the Though legislation has promoted policies gender equality and nondiscrimination in limitation or control of women’s earnings that foster inclusion in the workplace, different spheres, including employment, as well as the collection of a lower pay for there are more opportunities to expand along with other ministries, such as the the same job within the same workplace is on this. Labor, Employment and Social Security economic and financial abuse. Ministry. Reports Labor precedents The Argentine Bulletin of Labor Statistics, The Argentine Constitution amended whose set of indicators arises from in 1994 introduces clauses that grant different sources of information developed supra-legal status to human rights by the Argentine Ministry of Labor, treaties and conventions, such as the Employment and Social Security and the Convention on the Elimination of all National Institute of Statistics and Census, Forms of Discrimination Against Women, monitors the distribution of employment which establishes gender equality in per gender in Argentina. employment in article 11 (article 8(22), The Permanent Household Survey Argentine Constitution). conducted by INDEC also offers insights It also empowers the Argentine Congress on persistent inequalities in the Argentine to promote measures to ensure equality workplace. of opportunity and treatment, and full However, there are no mandatory reports enjoyment of rights recognized in the to be completed by employers in relation Argentine Constitution and international to D&I. treaties (article 75(23), Argentine Constitution). Javier Sabin [email protected]

Elizabet Lozada [email protected]

6 | DE&I — Diversity, Equity & Inclusion Australia Andrew Ball

Diversity, equity and Specific reporting requirements Non-compliance may result in the WGEA naming the employer in a report to the inclusion The Workplace Gender Equality Agency Act 2021 (Cth) requires private sector minister, on its website or in a newspaper. Non-compliance may impact whether Gathering information employers with 100 or more employees to file an annual report signed by the CEO the employer can tender for Australian Laws around the world are requiring that with the WGEA (www.wgea.gov.au) government work. companies do more to achieve diversity, The report covers gender equality equity and inclusion (DE&I). Leading practice indicators such as internal programs to One way to overcome inequality is to Leading practice for Australian employers promote gender equity, the number of measure it through formal reporting is to gather data on DE&I matters at women in leadership positions and any requirements. the hiring stage and through employee gender pay gap. Australia leads the way on gathering surveys and exit interviews. The reports are publicly available but data about gender equity and equal pay. The Australian Human Rights Commission exclude personal information and Apart from this there are no mandatory launched a Respect@Work report in March remuneration information. However, the reporting requirements. 2021. Recommendations include requiring WGEA can use pay gap data in aggregated employers to take more responsibility for reports including headline figures such as: Anti-discrimination laws preventing sexual harassment. Australia has comprehensive anti- • The current national gender pay gap is Employers can stay a step ahead of discrimination laws at both the federal and around 14% to 19% which is expected to regulators by taking proactive steps now state/territory level. close by 2040. to prevent discrimination and increase An employer must not discriminate DE&I outcomes for employees. • Only 14.1% of board chairs are women, against an employee because of, or for Diversity surveys ensure that data with very little change over the last six reasons including protected grounds gathering does not stop at mandatory years. such as the employee’s race, color, sex, WGEA reporting. sexual orientation, age, physical or • Women are more likely to hold lower- Surveys and exit interviews have the mental disability, marital status, family level line management roles than senior added benefit of potentially alerting the or caregiver responsibilities, pregnancy, leadership positions. employer to serious issues, enabling it to religion, political opinion, national head off anti-discrimination claims. extraction or social origin. An employer with 500 or more employees must have a formal policy or strategy These laws rely on employees making in at least one of nine areas such as complaints around the hiring process, recruitment, retention or promotions. their experience at work or upon An employer of 500+ employees must termination of employment. also have a policy or strategy in place for Can data on diversity measures be either closing gender pay gaps, supporting gathered? caregivers or preventing sexual harassment and discrimination. Yes, data on gender equality and equal pay is gathered by the Workplace Gender The employer must inform employees and Equality Agency (WGEA). Apart from this, shareholders or members that the public DE&I data is mainly based on a mixture report has been lodged. Donna Trembath of government inquiries and voluntary [email protected] participation by employers in DE&I initiatives. Andrew B Ball [email protected]

DE&I — Diversity, Equity & Inclusion | 7 Brazil Tatiana Carmona

Collection and maintenance Reporting and hiring obligations Even though most Brazilian companies are obligated to report employees’ of diversity information Currently, most Brazilian companies must report information relating to information, as well as to provide detailed payroll information to the Government, ESG and diversity the workforce to the Government. The report is made through an electronic there is no significant questioning on Companies in Brazil have focused more obligation named eSocial. Companies salary equality by the authorities. on environmental, social and governance must report specific personal information Aiming to reduce the differences of (ESG) issues and, diversity and inclusion about each employee hired under the salaries due to gender, there is a Law are very relevant. During the COVID-19 Brazilian Labor Law. Project being analyzed by the Brazilian pandemic, several companies have Therefore, some information must be Congress that establishes the payment of been planning and studying what the collected from employees during the a penalty in the amount corresponding to future of work will look like, considering selection process; otherwise, companies five times the difference of salary, during not only the work regime, but also will not be in compliance with local the total period of the work relationship new ways of evaluating performance, legislation. Mandatory information (observing the statute of limitations). measuring productivity, determining includes gender, race, skin color, social more appropriate benefits, etc. Many Conclusion name if applicable (transgender) and companies have already determined that it disabilities (including type of disability There are several reasons why a is fundamental for the business to assure – mental, intellectual, physical, hearing company should have a very structured there is a diverse team. or visual). process regarding diversity information: However, some companies still struggle compliance reasons and no less important, Additionally, companies with 100 or with a lack of information necessary to to make sure necessary actions will be more employees must meet hiring goals evaluate the current diversity picture, to taken to assure a diverse and inclusive for employees with a disability (from 2% establish a structured action plan, and to environment. to 5%, according to the headcount). The monitor and make sure the actions taken non-observance of such law may result will be effective. in penalties. Legislation regarding diversity Even though a report to the Government information is mandatory, it is important to be aware Brazilian law forbids any type of that in Brazil, there is a law related to discrimination for the purpose of access personal data protection. Therefore, or maintenance of the work relationship companies should implement very robust due to gender, race, origin, skin color, civil internal processes and controls around status, family situation, disability and age, employees’ personal information. among others. Also, the Brazilian Federal Gender equality Constitution expressly forbids salary differences due to the reason of gender, As mentioned, equal pay between males disability, age, skin color or civil status. and females is assured by law. However, according to a research recently published by the Statistics and Geography Brazilian Institute, in general, women received 77% of the salary paid to men in 2019.

Tatiana Carmona [email protected]

8 | DE&I — Diversity, Equity & Inclusion China Mainland William WL Zhang

Diversity, equity and • Rules on information processing should (except for the range of work that should be disclosed. not be assigned to female employees inclusion or other circumstances as stipulated • The purpose, method and scope of More companies are realizing that by the law) or gender preferences, nor the information processing should be employee diversity, equity and inclusion should they restrict the employment of expressly indicated. are closely related to enterprise creativity, women or refuse to employ women on productivity, customer satisfaction and gender grounds; they should not inquire • The law, administrative regulations or market competitiveness and thus are about a female applicant’s marital and agreement between the parties should trying to build the best compliant global childbearing status; nor should they not be violated. DE&I programs. include a pregnancy test in the pre- China Mainland Cybersecurity Law employment physical examination or Rules on diversity data collection and also specifies that key information include restrictions on childbirth as a transfer infrastructure operators should store condition for employment; and they personal information and important data In recent years, the China Mainland has should not increase the recruitment gathered and produced during operations placed significance on personal data standards for women in a differentiated within the territory of the China Mainland. collection and protection. The legislation manner. Where it is necessary to provide such and standards are becoming more Employers that are suspected of gender information and data to overseas parties comprehensive and the compliance discrimination should be subject to joint due to business requirements, a security stricter. In general, collecting diversity interviews and investigation by the local assessment should be conducted in data should comply with the principles administrative authorities and be exposed accordance with the measures formulated of legality, legitimacy and necessity and to the public through the media if they by the national Cyberspace Administration should meet the specific requirements refuse to make rectifications. Female in concert with the relevant departments under different laws. employees are entitled to file a case to under the State Council. Article 8 of China Mainland Employment demand equal employment rights. Contract Law states that employers Requirements on equal pay Conclusion should be entitled to, and employees Under China Mainland law, employees More companies are pursuing business or should render, a truthful explanation should enjoy the right to be employed on social fairness, which emphasizes the need of basic personal information relating an equal basis in accordance with the law. for diversity, equity and inclusion, but directly to the employment contract. Employees should not be subject to any they must follow certain procedures when Employees have the right to refuse to discrimination arising from differences collecting and processing employees’ provide information that is not directly in terms of nationality, race, gender and information. related to the employment contract. religious belief. China Mainland Labor Law According to Article 1,035 of China further clarifies that women should enjoy Mainland Civil Code, the processing of equal employment rights to men. When an individual’s personal information companies are recruiting employees, should comply with the principles of women should not be refused on the legality, legitimacy and necessity, should grounds of sex, nor should the recruitment not be excessive and should meet these standards for women be raised, except requirements: in those types of work or positions of work that are unsuitable for women as William Zhang • Consent shall be obtained from a stipulated by the law. In addition, the [email protected] natural person or his or her guardian employer’s recruitment information unless otherwise stipulated in laws or should not include gender restrictions Annie HP Li administrative regulations. [email protected]

DE&I — Diversity, Equity & Inclusion | 9 Practical approach Colombia The constitutional and legal development Paola Gutiérrez Sáenz has generated prohibitions in the workplace that mitigate any opportunity for discrimination in which the following stand out: for those under particular circumstances The gender equity track • In a selection process, questions (e.g., pregnant employees, soon to retire, should be geared toward determining Enabling diversity is a main principle of disabled or sick individuals). Regarding whether the candidate has the skills for guidance for employers as inclusiveness the LGBTIQ+ community, this court the position. Therefore, any inquiries is a way to boost performance of established that sexual orientation is a related to the intimate sphere of the working teams. matter circumscribed within the scope candidate constitute an indication of Over the past few years, inclusion has of individual autonomy that allows an discrimination. become a major issue in corporate individual to adopt, without coercion, life responsibility programs. It also has been projects that are considered pertinent • Requesting information on certain included in the agenda of governments as long as they do not violate legal order diseases or disabling conditions from as they seek to promote it through their and/or other rights. candidates or employees constitutes legislations, actions and rulings. But how Law 823 of 2003 was aimed at promoting an illegitimate practice that violates, well is the market responding to diverse equal opportunities for women. Thus, the among other things, the rights to non- workforce? government established the obligation to discrimination and to privacy. These eliminate sexism and other discriminatory may only be requested if a diagnosis Gender equity numbers criteria in the processes, contents and may expose the individual to higher According to data compiled by the methodologies of formal and informal risks (e.g., HIV tests, pregnancy tests, National Department of Statistics, in education. It developed actions to among others). Colombia, the average general wage promote non-discrimination against gap between men and women is 12.9% women at work and the principle of equal • Regarding the COVID-19 pandemic, if for 2019 in favor of men. However, pay for equal work. symptoms are suspected, the employer the direction of the gap changes when must direct the person to an authorized In relation to the protection of personal calculating the average wage gap per medical center to carry out a diagnostic data, Law 1581 of 2012 established hour of work. In fact, the gender pay test. This should not impede the the legal framework for its treatment. gap per hour for 2019 is -2.3% (i.e., per hiring process or the continuation of Furthermore, sensitive data is data hour, on average women earn 2.3% more employment. that affects the privacy of the holder than men). or whose improper use may generate Conclusion discrimination, such as racial or ethnic Constitutional and legal approach Any employer must promote diversity origin; political orientation; religious or It is important to note that the Colombian and inclusion, not only because it is the philosophical convictions; membership of Constitution established as a fundamental ethically correct thing to do, but because trade unions, social organizations, human right that all citizens are born free and diverse teams work better. At a time in rights organizations or that promote the equal before the law, and deserve the history where innovation is an intangible interests of any political party or that same rights, freedoms and opportunities asset, having a diverse and inclusive guarantee the rights and guarantees of without discrimination based on sex, team ensures that all employees feel opposition political parties; as well as race, national or family origin, language, free to express ideas that could lead to data related to health, sexual life and religion, and political or philosophical big changes. biometric data. opinion. According to article 23 of the This right has been extended to the aforementioned law, when an employer workplace in principles developed by the does not have a data protection policy Constitutional Court such as “equal work Paola Gutiérrez Sáenz or authorization to treat personal data per equal remuneration,” the right to [email protected] from its employees, it could be subject to equality and non-racial discrimination in economic fines by the Superintendency of the workplace and employment stability Alberto Pinzón Tafur Industry and Commerce. [email protected]

10 | DE&I — Diversity, Equity & Inclusion Costa Rica Laura Navarrete Hernández

Diversity, equity and Differentiation is not equivalent to Employees must provide written informed discrimination. It is completely valid consent for the collection of such data. inclusion to differentiate when based on truly The informed consent must include The workplace of the 21st century objective factors and not on the information on where the data is being Companies around the globe are focusing employees’ personal characteristics. collected, how they may access such data, more and more on diversity, equity Due to the above, filling specific diversity and how the data is being stored and/ and inclusion (DE&I) to have a better quotas may be a practice for employees, or processed. Employees should always workplace. A diverse and inclusive if based solely on the employees’ personal be made aware of their right to refuse workplace leverages from the different traits and not on their experience, to provide such information. In addition, perspectives, becomes more innovative competences, etc. legally protected sensitive data may not and collaborative, and strengthens It is best practice and fairness within be used for discriminatory purposes. the employees’ capacities to work in a their internal policies and procedures. Although most practices that seek to globalized environment. Employees deeply To accomplish this, it is key to train all incentivize DE&I in the workplace have appreciate working for an entity that decision-making employees to identify a good purpose, poor execution of such shows trust and appreciation, and for an their unconscious bias and focus on initiatives or lack of document trails to employer that values their uniqueness and the company’s business needs and the back up the rationale behind certain empowers them to express their diverse abilities, experience, talents and skills that decisions may bring discrimination claims points of view in a safe environment. each employee has to offer. against employers.

Rules against discriminatory Diversity monitoring practices Is a company permitted to collect sensitive Since 2017, Costa Rica has reinforced its personal data (e.g., race, nationality, rules against discriminatory practices in sex, age, sexuality, health, military all stages of the employment relationship. status) in relation to its employees These rules protect candidates against and prospective employees in order to discrimination in the recruitment process monitor diversity? The answer is yes and employees from discriminatory “under certain circumstances.” The Law practices when the relationship is for the Protection of the Person Against already in force or when it comes to the Processing of their Personal Data an end. Article 404 of the Labor Code (Law No. 8968) defines sensitive data prohibits any form of discrimination in as information related to the intimacy of the workplace based on age, ethnicity, the person (e.g., racial origin, political sex, religion, race, sexual orientation, opinions, religious or spiritual convictions, marital status, political opinion, socioeconomic status, biomedical or nationality, social origin, affiliation, health genetic information, life and sexual conditions, disability, union membership, orientation). Pursuant to article 9 of economic situation or any other form Law No. 8968, people are not obligated of discrimination. This ensures that to provide their sensitive data. Even employment decisions will be properly though there are certain exceptions, the substantiated on an objective reason law does not carve out as an exception and not on subjective conditions that are employment-related purposes related to intrinsic to each employee. diversity. Therefore, all data collection should be voluntary and anonymized to Laura Navarrete Hernández the extent possible. [email protected]

DE&I — Diversity, Equity & Inclusion | 11 Czech Republic Ondřej Havránek

Diversity, equity and Data on diversity Trends inclusion Overall data on diversity is anonymously There are clear statutory rules for anti- gathered, processed and published discrimination and equality, but no legal Diversity, equity and inclusion are long- by the Czech Statistical Office with an regulation actively demanding diversity in term topics resonating throughout the emphasis on gender statistics in various various functions. Czech society as well as governmental areas. This data is gathered regularly Employers are generally not required to programs. and is published approximately every publish data on salaries, making it difficult three years. The various areas include Legal background for employees to be aware of pay gaps demographics, health, education, salary, and file legal claims. Disputes relating to The equity of people is one of the main social security, criminality, representation diversity, equity or discrimination are still principles enshrined in the Czech Charter in public functions and employment in rather rare in the Czech environment. of Fundamental Rights and Freedoms, the information and communication In 2020, the Supreme Court issued an followed by the guaranteed fundamental technology sector. important decision promoting equal pay rights and freedoms regardless of gender, Specific data is gathered from the for employees performing the same work race, color of skin, language, belief and statistical reports made by various in different regions of the Czech Republic. religion, political and other opinions, official authorities and from a number of This decision has brought the equal-pay national or social origins, belonging to a databases and information systems. issue more into the public discussion. national or ethnical minority, property, lineage or other status. Data on equal pay Another labor market issue complicating the position of persons requiring flexibility The right to equal treatment and Data on equal pay between males and such as parents is a very low number of protection against discrimination females is part of the annual structural part-time positions offered by employers. is further regulated by the Anti- salary statistics performed by the Czech With the shift to remote work during the Discrimination Act. Statistical Office. This statistic is based on last year, this trend now seems to be Additionally, the equal treatment of all a sample survey among economic entities finally turning. It will be an important employees and prohibition of their randomly selected from the Register of task for the new Czech government after Economic Entities. The selected entity discrimination is stipulated directly in the the upcoming Parliamentary elections then must provide required data, including Czech Labor Code, including the principle to provide more systematic support of number of employees and their salary, to of the same remuneration for the same part-time and remote (home office) work, the Czech Statistical Office. If the entity work or work of the same value. also due to the implementation of the EU fails to provide the data, it may face a Work-Life Balance Directive. Protected categories penalty up to CZK100,000 (approximately Discrimination grounds under Czech EUR3,930). law are race, ethnic origins, nationality, Data on equal pay consistently shows a gender (including pregnancy, wide gender pay gap of approximately motherhood, fatherhood, gender 20% that represents the third widest identification), sexual orientation, age, gap among the EU member states. This disability, religion, and belief or worldview. makes the Czech Republic the subject of continuous criticism by the European Union and international organizations, not only regarding the pay gap but also Ondřej Havránek in relation to inequal representation [email protected] in managerial positions or in public authority bodies. Barbora Suchá [email protected]

12 | DE&I — Diversity, Equity & Inclusion Finland Maiju Kurvi

Diversity, equity and Companies employing at least 30 Conclusion employees must have a plan regarding the inclusion at workplace Diversity, equality and inclusion at measures and how it will promote diversity workplaces require continuous monitoring Finnish companies have recognized that a and prevent discrimination. There are no and concrete actions, supported by diverse workforce attracts the best talent defined special reporting requirements. the mandatory plans and reports, from and helps them outperform competitors. Authorities such as the Non-Discrimination employers. Company policies, culture Companies are building their diversity Ombudsman and the National Non- and adequate processes starting from and equity programs and have a need to Discrimination and Equality Tribunal as the evaluation of the company’s present gather data regarding their employees well as occupational health and safety situation and identification of the and jobseekers. authorities must ensure that companies measures needed to promote these topics are not in breach of legal requirements. have an essential role. Everyone in the What kind of data on diversity Should an authority ask for a clarification workplace — leadership, superiors and matters can be gathered? or a report of a suspected breach on all employees — have a role in creating a Companies are entitled to gather and an equity matter, the company must diverse and inclusive workplace. monitor only employee data that is provide this. directly necessary with respect to the employment. This data is related to the Reporting requirements on equal pay rights and responsibilities of employees The Act on Equality between Women and and an employer, and the benefits Men provides that as part of a gender provided by the employer or the special equality plan, an employer must provide nature of the employee’s duties, but rarely a written report on the grounds for all straight on diversity matters. salaries paid. Some data, such as competence, Should there be unlawful differences suitability and health suitability of an on the grounds for salaries for men and employee, may be regarded as diversity women, an employee is entitled to claim data and it, as well as other employees’ a compensation currently amounting to personal data, may be gathered only from at least EUR3,620. The employee may employees themselves or from other also claim compensation for damages records with the employee’s consent. and losses. Exceptions are not permitted even on The Ombudsman for Equality and the employee’s consent and thus, all collection National Non-Discrimination and Equality of data shall fulfill the requirements Tribunal monitor that companies are in of the Act on Protection of Privacy in line with the liabilities of the law. On an Working Life. authority’s request, the company must provide all necessary reports and show Reporting requirements on diversity documents to find out whether any According to the Non-discrimination Act, discrimination on salary payments has no one may be discriminated against taken place. If the company declines to on the basis of age, origin, nationality, provide this, a conditional fine may be language, religion, belief, opinion, political imposed. activity, trade union activity, family Maiju Kurvi relationships, state of health, disability, [email protected] sexual orientation or other personal Minna Saarelainen characteristics. [email protected]

DE&I — Diversity, Equity & Inclusion | 13 In addition to the above reporting obligations, many companies seek to gather data on diversity and inclusion in order to measure progress.

Can data on diversity matters France collected and gathered? Roselyn Sands Unlike the United States, in France, an employer is not permitted to ask an employee about his/her ethnicity, national origin, sexual preference, etc. Diversity, equity and need to comply with specific For employers, personal employee data reporting obligations: may be collected for hiring, salary, inclusion in France monitoring and access control purposes, The terms “diversity, equity and inclusion” • Companies with at least 50 employees such as name, personal address, age, are not per se covered by French Labor must publish each year indicators (4 to phone number, ID photo, social security Law. French law focusses more on 5 based on the headcount) relating to number, bank account details, family anti-discrimination laws and equal pay. women-men salary gap and the actions situation, gender or yearly appraisal However, through recent legislative implemented to eliminate them. score. But no data, for example on action, French law is encouraging The 5 indicators are the following, sexual preference, religion, national employers to achieve DE&I by various each being credited with a score: origin, ethnicity, political opinion, union means, including measurement, • Salary gap between men and membership, health state, judicial record, transparency, and reporting. This is quite women in view of their age and may be gathered. similar to the new ESG non-financial position Which makes it difficult to assess these reporting sought by sustainability-minded • Rate level of individual salary data for purposes of measuring progress. investors. increases • Promotion rate gap between women Best practices Legal protections and men If a company seeks a more inclusive and French labor law prohibits discrimination • Percentage salary increase in the diverse work environment, the following in employment covering a vast array year following the return from actions may be considered: of categories, 17 in all: national origin; maternity leave sex; sexual orientation; gender identity; • Number of the underrepresented • Prepare an action plan to work to age; marital status; pregnancy; genetic gender’ employees among the 10 achieve a work environment that characteristics; belonging or not highest earnings. guarantees the best level of health belongingto an ethnic group, a nation or and safety protection, that prevents • The score obtained out of 100 must be a race; political opinions; trade union or discrimination and harassment, and published. A score below 75 requires mutualist activities; exercise of an elective promotes DE&I corrective actions within a set period. mandate; religious convictions; physical Failure to meet these requirements appearance; surname; place of residence; • Include staff representatives in the may result in financial penalties (an state of health; disability; and ability discussions surrounding DE&I programs administrative fine of 1% of the total to express oneself in a language other and actions payroll). than French. • Apply for a “diversity label” In addition to these anti-discrimination • Obligations to bargain and consult certification awarded by Association laws, specific measures became the Social and Economic Committee Française de Normalisation (AFNOR) mandatory to ensure equality and (CSE - former Works Council) on equal that attests that the company fulfills diversity in the workplace. pay between men and women and the DE&I specifications Employees have 5 years to bring claims on quality of life at work or set up a The ideal would be to avoid a legal before court for violations of these specific action plan. obligation to publish an index on diversity rules in hiring, employment, and equal knowing that fostering a serene work opportunities for advancement. • In that frame, the employer shares with the CSE several information environment is also a key factor in In addition, employers have the absolute such as diagnosis of the comparative employee performance and engagement. obligation to safeguard employees’ health situation of women and men in terms and safety at work while ensuring their of hiring, training, promotion, salary well-being by preventing sexual and gap, qualification, working conditions, Roselyn S. Sands bullying or moral harassment. remuneration, professional activity/ [email protected] In order to achieve diversity and personal life balance, proportion of women and men on the board of Taïna Célestin inclusion in the workplace, companies directors. [email protected]

14 | DE&I — Diversity, Equity & Inclusion Georgia George Svanadze

Diversity, equity and Reporting Furthermore, any person considering himself/herself to be a victim of inclusion There are no specific reporting requirements on diversity or equal pay discrimination may bring a court action The laws of Georgia define and prohibit between males and females in Georgia. against the employer and may make a discrimination in labor relations. In 2020, claim for moral and/or material damages. As part of the 2020 amendments, a new new major amendments to the Labor norm regarding equal pay appeared in Conclusion Code of Georgia were enacted. As a result, the Labor Code. The new law specifically stricter rules related to prohibition of The laws of Georgia may be deemed states that employers must ensure labor discrimination were introduced. to put a heavy burden of proof on equal remuneration of female and male employers, who may have acted in employees for equal work performed. Gathering data on diversity discriminatory manner. As a result of The Labor Inspection has the right to The laws of Georgia do not require the recent amendments, the violation review cases related to the violation of gathering diversity-related data. by an employer of the principle of labor norms, including the norm related However, this information may be prohibition of discrimination as well as to equal pay, and to impose respective collected by different research or other other obligations under the Labor Code sanctions. types of organizations within various may lead to administrative inspection and penalties. Therefore, employers targeted projects. Participating in such Sanctions research is voluntary and at the request should pay special attention to issues In the event of a dispute relating to of the participant, anonymity may be related to discrimination and other labor discrimination, the burden of proof rests maintained. law requirements as well as examine any with the employer. decisions that are made in relation to Protection against discrimination Furthermore, it is prohibited to terminate employees. For the purpose of labor relations, an employment agreement with an discrimination is an intentional or employee, to treat an employee in a negligent action or exclusion of a person negative manner and/or to attempt to or giving to him/her a preference. The influence them because the employee grounds of such action may include filed a complaint or has cooperated race, skin color, ethnic or social with an appropriate body on possible affiliation, nationality, age, gender, discrimination at the workplace. sexual orientation, disability, health The violation of the principle of prohibition status, religious, public, political or other of discrimination results in a warning or a affiliation, political or other opinions, fine. The amount of the fine depends on or any other grounds aiming to deny or the organizational form of the employer breach equal opportunities or treatment. and its aggregate amount of VAT-taxable Discrimination in labor relations and transactions. pre-contractual relations — including when publishing a vacancy and at a selection stage — and in employment and occupation is prohibited.

George Svanadze [email protected]

Flora Kashkhchiani [email protected]

DE&I — Diversity, Equity & Inclusion | 15 Germany Bärbel Kuhlmann

Diversity, equity and Gathering data on diversity than 500. Within this, employers must regularly submit a report outlining the inclusion in Germany In general, there is no mandatory law with regard to data gathering on diversity measures taken to promote gender equality and the equal pay principle The value of diversity for employers, even though specific regulations for certain groups have to and justify it if no such measures have Diversity has become a prominent issue be followed (e.g., maintaining a register been taken. Moreover, the report must in today’s working world. Companies listing employees with disabilities). If contain data on the average total number promoting diversity within their an employer gathers data on diversity of employees as well as on the average organization benefit from greater in order to promote more diversity number of full-time and part-time employee satisfaction, market advantages and inclusion within its workforce, employees by gender. There are no legal in the competition for new talents and strict data protection laws, such as the penalties for non-compliance with those business partners, and increased success. German Federal Data Protection Act reporting obligations. Nevertheless, Gathering data on diversity is particularly (Bundesdatenschutz-gesetz) and the compliance with those laws is encouraged, relevant for employers when evaluating General Data Protection Regulation taking into account the company’s their existing diversity management or must be followed. According to those reputation. implementing new strategies to promote regulations, the processing of employees’ diversity, equity and inclusion. Best practice personal data is only allowed if it is either expressly permitted by law or if Gathering data on diversity may be Categories protected against a valuable first step for employers discrimination the employee has consented to the data processing on an individual case-by-case to develop effective and sustainable Promoting diversity and inclusion as an basis. These strict regulations may hinder diversity management. With regard to employer means valuing each employee the employer in gathering data with the implementation of data gathering for his/her individual characteristics and regard to diversity, especially if such data measurements, employers should lifestyle and integrating them equally. relates to personal details of the employee comply with data protection laws German law promotes diversity and such as his/her ethnic origin or religion. and communicate thoroughly with inclusion by protecting certain categories their employees to gather data on a against discrimination. According to Gathering data on equal pay consensual basis. Article 3 of the German Constitution, no The German Remuneration Transparency person shall be favored or disfavored Act (Entgelt-transparenzgesetz) because of sex, parentage, race, promotes equal pay for women and language, homeland and origin, faith, men for the same work or work of equal religious or political opinions or disability. value. According to the Remuneration Regarding the protection against Transparency Act, each employee is discrimination in work life, Section 1 of entitled to gain information by the the German General Equal Treatment Act employer in order to verify compliance (Allgemeines Gleich-behandlungsgesetz) with the equal pay principle. Furthermore, forbids any discrimination on the grounds the Act regulates reporting obligations of race or ethnic origin, gender, religion or for employers regularly employing more belief, disability, age or sexual orientation.

Bärbel Kuhlmann [email protected]

Mira Ney [email protected]

16 | DE&I — Diversity, Equity & Inclusion Greece Maria Rigaki

Diversity and inclusiveness and sufficiently detailed to respect equality in professional development, the principles of transparency and observance of maternity protection initiatives proportionality and to be in accordance legislation, and the implementation Diversity is about differences, such with the Operating Regulation and of equality plans or other innovative as nationality, language, education, the Corporate Governance Code that measures to promote effective gender gender and gender identity/expression, the company follows. The Fitness and equality. Companies that have been sexual orientation, generation, age, Propriety Policy should provide for awarded the Gender Equality certification socioeconomic background, working and diversity criteria for the election of board are required to submit an annual report thinking styles, religious background, members, achieving a variety of opinions on actions related to the gender equality abilities and disabilities. Inclusiveness is and experiences to reach better decisions. agenda. The Secretary General monitors leveraging these differences to create A significant innovation of the law is the and evaluates whether the awarded a positive environment. While there are explicit provision that the election criteria companies continue to implement policies many aspects to a sustainable working of the board members include at least the of equal treatment and equal environment, Greece has mainly focused sufficient representation per gender in opportunities for working women and men on legislation related to the support of a percentage not lower than 25% of the and, if not, removes the certification. The employment of people with disabilities (as total number of its members, requesting Secretary General publishes an annual list of the late 90s, Law 2643/1998 requires the participation of more women to the of companies that hold the certification on companies with more than 50 employees boards of listed companies. its website. to hire to a level of 8% of employees with Another initiative is included in the special needs) as well as provisions related provisions of Law 4604/2019 (which Best practices to the equal pay principle between men are expected to be further reinforced Despite the fact that a D&I legislative and women. through the labor law reform approved agenda of active measures is in an early Therefore, although the Greek by Parliament in June 2021) in relation stage of development, there are extensive Constitution prohibits any act of to the Gender Equality certification examples of Greek companies that unequal treatment, there is room for provided to champion companies. The incorporate an active agenda of initiatives active measures that directly promote Secretary General for Family Policy and and internal policies that aim to establish inclusiveness and diversity in the Gender Equality and the Greek Ministry working environments where every voice workplace. of Employment reward public and and idea count. private sector companies that excel in Diversity and inclusiveness implementing policies of equal treatment regulatory initiatives and equal opportunities for working The relatively recent Law 4706/2020 women and men by awarding the Gender on Corporate Governance of Societe Equality certification. Anonymes introduced respective The award takes into account, inter initiatives for societes anonymes with alia, equal pay for equal work, balanced shares or other securities listed in participation of women and men in a regulated market in Greece. More managerial positions or in professional specifically, listed companies should have and scientific teams in the company, available a Fitness and Propriety Policy for board members that is unambiguous

Maria Rigaki [email protected]

DE&I — Diversity, Equity & Inclusion | 17 Proposed requirements on listed Hong Kong companies’ gender diversity Rossana Chu Although newly listed single-gender board companies have committed to appointing at least one female director within two to three years after IPO, there was little Hong Kong is taking active directly related to a function or activity improvement in raising the percentage of of the data user. Data collected should be female directors on the listed companies’ steps to improve gender necessary and adequate but not excessive boards. Further, gender diversity is a diversity in listed companies for such purpose. key ESG consideration that is attracting When collecting personal data from data the attention of regulators and investors Boards of Hong Kong listed subjects directly, data users should inform around the world. companies make gains in diversity data subjects whether it is obligatory or In April 2021, the Hong Kong Stock Hong Kong listed companies are slowly voluntary to supply the data, the purpose Exchange issued a consultation paper making improvements in promoting of their data and the classes of persons to seeking public comments on proposed gender diversity. According to an MSCI whom their data may be transferred. Data amendments to the Corporate Governance report issued in November 2020, users should also inform data subjects of Code and Listing Rules of the Stock the percentage of Hong Kong listed their right and means to request access to Exchange. The general objective is to companies’ board seats held by women and to correct their data. promote good corporate governance increased from 10.6% in 2016 to 12.7% practices among Hong Kong listed Requirements on new listing in 2020. Such proportion is comparable companies and IPO applicants. To promote with the 13% rate in mainland China applicants gender diversity among listed companies, but is still far behind that of its peers in The stock exchange requires applicants the Hong Kong Stock Exchange proposes other international finance centers (e.g., looking to list in Hong Kong to include in that: US (28.2%), United Kingdom (34.3%), their listing documents: • Diversity is not considered to be Germany (25.2%) and France (43.3%)). • Specific environmental, social achieved with a single-gender board. As at end of 2020, around 32.1% of Hong and corporate governance (ESG) Kong listed companies had no female • Listed issuers with single-gender disclosures, including the applicants’ directors, while around 37.4% had only boards are given a three-year transition environmental policies and the one female director. This proportion can period to appoint at least one director processes to identify, evaluate and also be seen in tech companies where of the absent gender. manage significant ESG risks. boards are dominated by male directors. • IPO applicants are not expected to have We are now seeing increasing positive • Policy on board diversity (including single-gender boards. changes toward gender diversity in Hong gender). If an applicant has a single- Kong where global funds and institutional gender board, it should disclose: • Listed issuers should set and disclose investors are now prioritizing board numerical targets and timelines for diversity in investment decisions. • How  and when gender diversity achieving gender diversity, both at the of the board will be achieved after board level and across the workforce Collection of personal data relating to listing (including senior management). diversity • Its  measurable objectives for Data collection is an essential first • Listed companies should review the implementing gender diversity (e.g., step to enhance diversity, equity and implementation and effectiveness of specific numerical target for the inclusion. In Hong Kong, the Personal Data diversity policies annually. proportion of the absent gender on (Privacy) Ordinance (PDPO) regulates the its board by a certain year) collection, use and handling of personal data, including diversity data such as • Its  measures to develop a pipeline Rossana Chu gender, marital status, nationality, religion of potential successors to the board [email protected] and ethnicity of a data subject. that could ensure gender diversity Under the PDPO, personal data should of the board Jacky Chan only be collected for a lawful purpose [email protected]

18 | DE&I — Diversity, Equity & Inclusion India Anirudh Mukherjee

Diversity data in Indian relating to gender identity, religious without consent. However, an employee’s beliefs, caste and race may qualify as consent is required for processing SPD. workplaces personal information and not SPDI. PDPB also stipulates additional conditions The Indian Constitution grants all citizens Data that falls into the category of for processing of SPD. equality of opportunity in matters of personal information can be collected Reporting requirements under gender public employment and stipulates that from employees on a voluntary basis. discrimination laws no citizen shall be discriminated against For collection of SPDI, the employee’s on the grounds of religion, race, caste, consent regarding purpose of usage must Anti-discrimination laws applicable to sex, descent, place of birth and residence be obtained in writing through letter, fax the private sector prohibit discrimination with respect to any employment or office or email. based on gender or disability. The Equal Remuneration Act, 1976, requires under the state. There are also specific D&I data (i.e., data collected by employers employers to pay equal remuneration legislations applicable to the private constituting either personal information to men and women workers for the sector that prohibit discrimination at the or SPDI) must be collected for a lawful same or similar work, and prohibits any workplace. purpose and should be used for that discrimination against women. This To manage the challenges surrounding purpose. Employers collecting D&I data act stipulates that employers maintain diversity and inclusion, there has to be a should take reasonable steps to ensure an up-to-date register in relation to its clear understanding of the composition that the employees are aware that it is workers, specifying the number of male of work groups and their demographic being collected, the purpose of collection, and female workers and the remuneration differences. Therefore, it is vital to gather its intended recipients, and the details paid. Failure to maintain such a register demographic data for promoting diversity of the agency that is collecting the is punishable with imprisonment for a within the workforce. information and the agency that will term that may extend to one month or retain the information. Employers should with a fine that may extend to INR10,000 Legality of data collection publish a privacy policy and comply (~USD136.15), or with both. The Indian personal data protection law with reasonable security practices and is currently governed by the Information procedures. Employees must be given the Conclusion Technology Act, 2000 (IT Act) read with choice to opt out from providing D&I data. There is no blanket prohibition on the Information Technology (Reasonable A grievance officer should be designated collection of diversity data under Security Practices and Procedures and for redressal of any complaints with Indian law. However, the collection and Sensitive Personal Data or Information) respect to D&I data processing. Rules, 2011 (IT Rules). processing of such data have to comply The Indian Government is seeking an with the personal data protection Personal information has been defined overhaul of the country’s data privacy framework, as well as the mandatory to mean “any information that relates to framework through the Personal Data recording requirement contained in laws a natural person, which, either directly Protection Bill, 2019 (PDPB). It is prohibiting discrimination. or indirectly, in combination with other presently under the consideration of a information available or likely to be Joint Parliament Committee and is not available with a body corporate, is capable yet in force. PDPB classifies data into of identifying such person.” The IT Rules personal data and sensitive personal delineate certain classes of personal data (SPD). Personal data relating to information as sensitive personal data or health, sexual orientation, transgender or information (SPDI). As per the IT Rules, intersex status, caste, tribe, and religious information relating to sexual orientation or political beliefs or affiliation falls in the Anirudh Mukherjee and physical, physiological and mental SPD category. PDPB permits employers to [email protected] health, among others, falls under the process personal data (not SPD) necessary Lakshmi Devi P category of SPDI. However, information for purposes related to employment [email protected]

DE&I — Diversity, Equity & Inclusion | 19 Italy Stefania Radoccia

Areas of intervention The definition of large companies includes companies employing more than 500 During the last several years, Italy has employees and companies that closed strengthened actions to incentivize their related fiscal year reaching a certain companies to achieve diversity and to minimum overall income statement or reduce the gender gap. overall net revenue. All companies of the Such actions are notably focused on private and public sector employing at increasing the presence of the less- least 100 must report on gender equality represented gender at the management and pay gap statistics at least every level and prompting large companies to two years. disclose data on diversity and equal pay. Noncompliance with reporting obligations may expose the company to The collection of data on DE&I matter variable economic sanctions depending Generally speaking, companies are on the breach. entitled to gather all data necessary for In addition, females are required to the performance of the employment comprise at least 40% of the board of and for compliance with specific legal directors and of the statutory auditors’ obligations. composition in listed companies. In this respect, privacy laws say that data The same provisions apply to non-listed related to the employment relationship publicly controlled companies. — including those concerning diversity, equity and inclusion (DE&I) matter such Noncompliance with such requirements as gender, age, disability — can only be may expose the company to sanctions by collected within the principles of the the Italian exchange supervisory agency. General Data Protection Regulation Leading practices in Italy (GDPR) or upon an employee’s consent. In light of the statutory scenario and Other DE&I information (e.g., sexual the limitation on data collection by the orientation or religion) cannot be collected employer, Italian large companies have by the employer when not tied to these been incentivized to do more to achieve purposes or tied to the assessment of the diversity and gender equality. employee performance. The economic return in terms of branding Mandatory reporting requirements on and human capital related to DE&I diversity and equal pay achievement seems to push companies to Several laws require that companies adopt measures in this respect. report their data on DE&I and equal pay. More efforts are expected on this matter Notably, public interest entities (such as to promote inclusion. banks or insurance companies) and large company groups should publish DE&I statistics in financial reporting. Stefania Radoccia [email protected]

Maria Teresa Iannella [email protected]

20 | DE&I — Diversity, Equity & Inclusion Japan Junya Kubota

Collection and disclosure of The Employment Security Act guidelines There is no sanction for violating those issued by the government state that requirements. The act only provides that diversity data information on job applicants’ race, a person who fails to submit a report ethnicity, social status, family origin, (or makes a false report) ordered by the Categories protected against registered domicile, place of birth, creed Minister of Health, Labor and Welfare will discrimination and union membership can be collected be punished by a non-criminal penalty of The Labor Standards Act and other only if the information is necessary for an not more than JPY200,000. employment laws protect employees occupational reason and the information is from employers’ discriminatory treatment collected directly from the job applicants Leading practice based on nationality, creed, social status, who are informed of the purpose of the As discussed, the collection of certain sex, disabilities, labor union membership, collection. Further, the Industrial Safety diversity data (such as religion) from job age and contractual status (i.e., different and Health Act requires an employer to applicants is restricted. Employers should treatment between regular employees and collect information on physical and mental communicate such information only to fixed-term and/or part-time employees). conditions of workers only within the confirm whether there are any obstacles The scope of protection varies depending necessary scope to ensure the health of to the job applicants’ ability to perform on category. For example, in Japan, it is the workers. their duties after being hired. generally understood that a mandatory retirement-age system is legally valid. Disclosure of diversity information The Act on Promotion of Female Collection of personal information Participation and Career Advancement Under the Personal Information in the Workplace requires an employer Protection Act, an employer must specify with 301 (101 from April 2022) or more and make known to the data subject employees to prepare and disclose to (i.e., job applicants and employees) the the public an action plan concerning purpose of collecting his or her personal promotion of female participation and information. An employer cannot use career advancement in the workplace. collected personal information for any The action plan is required to have certain other purpose the data subject’s consent quantitative targets. A notification to (there are several exceptions). Further, an the authority is required when an action employer is required to obtain the data plan is formulated. Further, an employer subject’s consent to collect “special care- with 301 (101 from April 2022) or required personal information,” which more employees is required to publicly includes personal information about a disclose certain information on promotion data subject’s race, creed, social status, of female participation and career medical history and criminal record, status advancement at the workplace, such as as a crime victim, or other descriptions the rate of females among managerial that are prescribed by the Cabinet employees. The government gives Order. The Employment Security Act certifications to companies satisfying imposes special restrictions on collecting certain criteria regarding promotion of information on job applicants during women’s participation in the workplace. recruitment to prevent discrimination.

Junya Kubota [email protected]

DE&I — Diversity, Equity & Inclusion | 21 Lithuania Rūta Žukaitė

Equality and non- qualification, setting work evaluation Liability for the breach of principle of criteria and criteria for dismissal from non-discrimination discrimination at work work, remuneration for the same work, Following the Code of Administrative etc. Moreover, an employer with 50 or Offences, an administrative fine may be Groups protected against more employees must adopt the measures imposed for the breach of the Labour discrimination for implementation of the principles for Code and/or Law on Equal Opportunities. The Lithuanian Labour Code establishes the supervision of the implementation and Moreover, employers may be required to that one of the key principles of enforcement of the equal opportunities pay the employee a compensation (e.g., employment relations is equality policies. Such policies must be prepared the difference in remuneration for the of persons. Therefore, the national and adopted in consultation with same or equal work, compensation of non- labor laws as well as the Law on Legal the work council (if there are more pecuniary damage) for damage caused by Opportunities require employers to than 20 employees). The information the breach of principles of equality and implement the principles of gender and statistics on equality and non- non-discrimination. equality and non-discrimination on other discrimination at work issues are gathered Nonetheless, society is paying grounds. Under these principles, direct by various means, such as anonymous more attention to equality and non- or indirect discrimination, harassment, surveys, data of the State Social Insurance discrimination issues at workplaces. sexual harassment or instruction to Fund Board, etc. Therefore, it is important for employers discriminate on the following grounds to follow these principles not only de is prohibited: gender, race, nationality, Gender equality jure, but also de facto. Otherwise, an language, origin, social status, age, Following the Lithuanian Labour Code, the imposed administrative fine may be minor sexual orientation, disability, ethnic remuneration system must be prepared compared to the damage to the company’s affiliation, political affiliation, religion, in such a way to avoid gender-based or image in the eyes of existing and potential faith, and convictions or views. There other discrimination in its application. employees and business partners. is an exception concerning a professed Men and women must receive equal religion, faith or convictions for those remuneration for the same or equal work. working in religious communities, The principles of gender equality and non- societies or centers, provided that the discrimination apply not only to the base requirement for the employee is normal, remuneration of the employee, but also lawful and justifiable. The following to all additional earnings in cash or in kind grounds are also included: intention to that the employee receives either directly have children or circumstances unrelated or indirectly from the employer for his/her to the employees’ professional qualities work. Additionally, a new obligation of the or on other grounds established by employer to publicly disclose information laws. The employer must follow gender on average remuneration by gender equality and non-discrimination principles came into force. This obligation applies to in all decision-making processes that employers with at least 8 employees, of concern employees, such as setting whom there are more than 3 women and selection criteria and conditions when more than 3 men. hiring employees, creating working conditions and opportunities to improve Rūta Žukaitė [email protected]

Augustė Žėkaitė [email protected]

22 | DE&I — Diversity, Equity & Inclusion Luxembourg Laurence Chatenier

Diversity, equity and The Center for Equal Treatment Gender equality (CET) monitors equal treatment by Since 2006, equality between women inclusion publishing reports, issuing opinions and and men has been embedded in the recommendations, gathering complaints, Diversity is part of the landscape Luxembourg Constitution and since 2016, and giving advice and orientation to in Luxembourg, with 170 different the Labor Code has guaranteed equal pay discriminated individuals. nationalities, around 200,000 daily for women and men. If a difference in pay cross-border workers and three official At the company level, each employer with cannot be justified by objective reasons languages, and with females comprising more than 150 employees must provide and is based on gender considerations, 41% of workers. statistics regarding equality between the employer can be sanctioned by a fine The public authorities are committed to women and men on hiring, promotions, between ERU251 and EUR25,000 (Art. promoting diversity in the day-to-day life dismissals, remuneration and trainings. L.225-1 and following of the Luxembourg of citizens and workers. The Ministry for In addition, quotas regarding employees Labor Code). the Family and the Integration is sponsor with disabilities have been implemented According to recent data from the of the Diversity Charter Lëtzebuerg, and should lead to penalties in cases of Statistical Office of Luxembourg, the which is a national commitment, open non-compliance. wage gap between women and men is for signature to any organization in However, it appears that only 18% of the estimated at 5.5%; at the European level, Luxembourg wishing to promote diversity companies in scope meet the quota set by the difference is close to 15%. through concrete actions that go beyond law and that the financial penalties are not legal obligations. frequently applied. This Diversity Charter currently has more than 200 signatories from both public Discrimination categories and private sectors (representing 15% In Luxembourg, discrimination is ruled by of the Luxembourg workforce) and new both labor and penal codes. signatories join each year. Any direct or indirect discrimination on By signing the Diversity Charter, the grounds of religion or belief, disability, employers commit to fighting all forms of age, sex, sexual orientation, nationality, or discrimination and to setting up policies in established or supposed membership or favor of equal opportunities and diversity, non-membership of an ethnic group or a focused on the acknowledgement and race is prohibited. valuing of individual skills. In 2016, the scope was extended by providing that “any discrimination based Gathering on diversity matters on the change of sex is considered In Luxembourg, public institutes discrimination based on sex.” (universities, research institutes, non- Any person who considers that he or governmental organizations) run large she is a victim of direct or indirect surveys and studies on diversity and discrimination can contact CET for advice discrimination. and information. The Labor Authorities can also act as a mediator before legal action before a court. Laurence Chatenier [email protected]

Marion Lorrain [email protected]

DE&I — Diversity, Equity & Inclusion | 23 Netherlands Huub van Osch

Diversity, equity and treated differently from an employee with Equal Treatment Act. However, it is still an indefinite employment agreement, unclear whether the proposal will be inclusion from a Dutch law this may under circumstances be accepted. With this proposal, unequal pay perspective lawful when it is regarded objectively must be countered by means of several as necessary to achieve a legitimate instruments, such as: As a main principle, discrimination is aim and is proportionate to the aim. prohibited in the Netherlands, based on Discrimination may also be lawful if the 1. The burden of proof shifts to the Article 1 of the Dutch Constitution. This law specifies exceptions. An example in employer to prove that equal pay is further specified in various Dutch laws. Dutch employment law is termination of is observed. According to the civil code and the Equal an employment agreement at the state Treatment Act, direct discrimination on 2. Certification is required for companies pensionable age. Lastly, discrimination religion, personal beliefs, political opinion, with more than 250 employees and may (under strict circumstances) be lawful race, sex, nationality and civil status is there is an increased burden of proof in the case of positive discrimination. prohibited. In addition, Dutch employment if the company does not have such a certificate. law stipulates that discrimination on Enforcement age, temporary/permanent employment Any complaint regarding discrimination 3. For companies with at least 50 contracts, the amount of working hours, may be reported to the Netherlands employees, several obligations shall disability and chronic illness are also Institute for Human Rights. This institute be applicable, such as the obligation prohibited. Employers are required to is responsible for monitoring compliance to provide access to anonymized data observe the principles of equal treatment with the Equal Treatment Regulations in on wages and the obligation to inform in the employment field. the Netherlands. The complainant can the works council once a year about Discrimination also request an official opinion on the differences in pay. complaint. The Netherlands Institute for Direct discrimination occurs when a 4. The employee may file a complaint Human Rights will assess whether the person is treated less favorably than toward the company in the event of discrimination complaint is justified and another person due to an underlying unexplained differences in payment. make a ruling. However, these judgments characteristic, such as race or gender. If the employer has not dealt with the are not legally binding. Indirect discrimination occurs when complaint within two months or has not (within the employment context) there Equal pay proposal dealt with it properly in the employee’s is a practice, policy or rule that applies opinion, the employee may file a Despite legislation that prohibits unequal to all employees in the same way but complaint with the Dutch Institute for treatment between men and women, has a less favorable effect on some Human Rights. women are often still paid less than men employees. In certain circumstances, for the same work. For this reason, a indirect discrimination may be lawful. legislative proposal has been filed that When, for example, an employee with is intended as an additional measure a fixed-term employment agreement is to be incorporated into the existing

Huub van Osch [email protected]

24 | DE&I — Diversity, Equity & Inclusion New Zealand Tori Sullivan

Diversity data in Collecting data When collecting and analyzing employment DE&I data, employers New Zealand These new legislated DE&I initiatives will require employers of all sizes and in should have strict policies, processes and Gender is regarded as the most important different parts of NZ to form a view of contractual terms in place to ensure there diversity issue for NZ employers, with what employees’ pay should look like. are appropriate safeguards to reduce well-being and bias the second and third.1 However, the collection and analysis of an inadvertent breach of the 13 IPP by Although there is a 9.3% gender pay gap,2 data will be an important part of that adequately protecting data. there is no legislation that specifically process, helping inform whether an Reporting requirements regulates an organization’s gender organization’s policies and practices are pay gap. Rather, the current diversity, having their intended DE&I effect. There are no specific reporting equity and inclusion (DE&I) employment requirements on DE&I statistics. Diversity data can be gathered in NZ; initiatives focus on pay equity, increased however, the collection and use of Leading practices sick leave (increasing from 5 to 10 days personal information by public and private per annum) and fair pay, complementing Organizations need to consider whether sector agencies must comply with the 13 NZ’s well-established (but largely un- and how to voluntarily communicate Information Privacy Principles (IPP) set tested) Equal Pay Act 1976, as well as their DE&I statistics to employees and out in the Privacy Act 2020. Personal NZ’s existing anti-discrimination and other stakeholders. From a transparency information is broadly defined to include human rights rules. perspective, organizations are any identifiable information such as details increasingly reporting their DE&I statistics The Pay Equity Amendment Act came of sex, race and occupation. in their annual sustainability reports. into force in November 2020 and seeks Broadly, organizations can collect to address the pay equity gap where personal information about employees an employer predominantly employs for valid work purposes only or where one gender and, as a result, wages are directed by the law but must ensure that lower (e.g., in childcare) by establishing a they protect the privacy of the personal process to resolve pay equity claims. information and must not disclose or use Further, the Government has signaled the personal information for any other that Fair Pay Agreements (FPAs) will purpose. Any agents that the organization be re-introduced toward the end of uses (including cloud storage providers) 2021, imposing compulsory nationwide also need to take reasonable steps to agreements that determine the wages, avoid loss or unauthorized access, use, terms and conditions for all workers within modification or disclosure of personal particular industries. The FPA-proposed information. changes do not just apply to a narrow The Privacy Act recognizes that personal range of low-paid or vulnerable workers information routinely finds its way outside as originally signaled. Rather, it’s required of NZ. To strengthen accountability, that more than 1,000 workers, or 10% of before transferring personal information the workforce, request an FPA. offshore, organizations may need to ensure that it is protected by comparable data protection law. Tori Sullivan [email protected]

Kieron Creagh 1. Workplace Diversity Survey 2020 [email protected] 2. As of 30 June 2019.

DE&I — Diversity, Equity & Inclusion | 25 Norway Helga Aune

Employer’s activity and year); analyze the causes of any risks Even though one may not count identified; implement measures designed individuals based on the specific protected reporting obligation to combat discrimination and contribute grounds, an employer may still count the Norwegian employers are subject to the to improved equality and diversity at the measures instigated to secure a culture general duty to actively and consciously company; and assess the results of the where no discrimination takes place and promote equality (equal opportunities) work carried out. equal opportunities are promoted. As and prevent discrimination in all HR- such, one may produce quantifiable data Reporting obligation areas of the organization per the on the amount of D&I work carried out by Norwegian Equality and Discrimination All employers are required to document an employer. Act. The grounds of protection against that they have worked systematically in D&I on the agenda discrimination include gender, pregnancy, accordance with legislative requirements. maternity/paternity or adoption leave, Employers subject to the four-step The board is responsible for ensuring that care obligations, ethnicity, religion, method are also to fulfill a reporting duty. the obligation to actively work for equality philosophy of life (non-religious views), This requires the company to include and the obligation to account for this is disability, sexual orientation, gender a statement in the company’s annual fulfilled. Systematic work is required if identity, gender expression or any report or another public document on the the board is to succeed in its work. It is combination of these. Employers must said activities, where they are to work necessary to ensure that the company has also strive to prevent harassment, sexual systematically. The board is responsible the tools and the knowledge it needs to harassment and gender-based violence. for securing compliance with the activity work with equality at a systemic level. Age, political position and trade union and reporting obligations. Breach of the affiliation are also protected against duty to report may lead to a fine imposed discrimination in the Working Environment by the Norwegian Anti-Discrimination Act but are not included in the employer’s Tribunal. Violation of the equal pay general duty. provision may additionally result in compensation or redress. The activity and reporting duty must encompass the workplace processes Data on diversity matters when recruiting, in pay and working Employers are obligated to comply with conditions, in promotion, in development the activity and reporting obligation. opportunities and in work and family This involves mapping gender balance life balance. There is a specific activity when it comes to salary, temporary obligation for public employers, private employment, part-time work and parental employers with more than 50 employees, leave. This data can and must be obtained or if one of the work life parties requires and stored by the employer to fulfil the it in companies with 20 -50 employees. obligation. Other discrimination grounds, The activity duty requires the employer such as ethnicity, religion, philosophy, to work in a four-step method, where disability and form of cohabitation may they need to: at a minimum every second not be monitored on a regular basis. An year, investigate whether there are risks applicant’s status in in these regards are, of discrimination or other obstacles to under special circumstances, nevertheless equality, including a duty to map pay permitted if the information is of decisive conditions between men and women Helga Aune importance for the performance of the (it is also a duty to report on the use of [email protected] work or profession. involuntary part-time work every other Elisabeth Saetersdal-Walle [email protected]

26 | DE&I — Diversity, Equity & Inclusion Peru Renán Mantilla Ramirez

Labor inclusion and equal Very few companies have complied does not seek unjustified pay equity with the obligation to hire a minimum for all, but rather to objectively justify pay in Peru percentage of people with disabilities. This differences in remuneration that exist The labor market has always faced is due to multiple factors, such as the lack within companies based on adequate constant change, but the changes brought of supervision by the inspection authority, valuation of jobs and, consequently, on by the COVID-19 pandemic are forcing a regulatory framework that is not the value said jobs generate for the companies and their employees to adapt adapted to the current reality and the fact organizations. The regulations also to new challenges. that people with a disability may decline to require employers to support promotions be labeled. based on objective criteria, which not Together with ongoing globalization, only motivates greater production by this makes it all the more necessary to Therefore, although a formal law exists employees, but also creates a salary and promote a policy of respect for diversity that benefits this group, obstacles remain. promotion management system based on and labor inclusion in all social spheres, True equality duly justified merit. especially within labor relations. The promotion of fair and objective practices Another matter recognized and regulated Failure to comply with these obligations has a direct impact on the productivity by Law No. 30709, The Equal Salary can generate fines of up to UIT300 of a company and helps foster a more Law is pay equality. This law prohibits (US$300,000 on average). competitive business environment. compensation discrimination between men and women. Conclusion Toward inclusion This law creates two main obligations for Adopting a culture of diversity and Article 2 of the Peruvian Constitution the employer: to develop a remuneration inclusion encourages innovation, established that everyone has the right policy and to develop an organization stimulating a healthier work environment to equality before the law. No person chart based on the value of the job. and improving worker performance, thereby helping a company become a shall be discriminated against based Although this law was designed to equalize more competitive presence in the global on origin, race, sex, language, religion, salary gaps between men and women, market. opinion, economic status or any other the fact that it can be applied generally distinguishing feature. to benefit all kinds of employees makes Some laws have sought to promote it stand out. Based on this regulation, equality and include different sectors that any employee can demand compensation have long been marginalized. according to his/her merits, efforts and One such example is Law No. 29973, abilities, regardless of sex, race, age, General Law of the Person with religion or any other condition. This Disabilities, which dates to 2012 and represents a significant advance toward a regulates an employment quota for fair and truly competitive labor market. private entities (not less than 3% of the It is important to highlight that this law payroll for companies with more than 50 workers) to reduce the historical lack of labor inclusion of people with disabilities.

Renán Mantilla Ramirez [email protected]

DE&I — Diversity, Equity & Inclusion | 27 Poland Zuzanna Zakrzewska

Diversity, equity and Polish law therefore provides an open Penalties catalog of grounds that may result in inclusion in Poland The Polish Labor Code guarantees the discrimination against employees. right to compensation if an employer breaches the principle of equal treatment Importance of equality in workplace Gender pay gap in employment. In such a case, the More and more employers and employees According to Eurostat, the gender pay gap employee is entitled to compensation in recognize the importance of diversity, in Poland, construed as the difference in an amount not lower than the minimum equality and inclusion in the workplace. the average gross hourly wage between remuneration. Therefore, it is important to be aware of men and women, stands at 7.2%, while the legal regulations in this regard. average gender pay gap in the European Best practices Union is 16.2%. Anti-discrimination laws While social awareness of the need for a diverse working environment increases, The Polish Constitution plays an essential Reporting requirements regarding we expect new regulations in this area. role in the legal system on gender diversity and equal pay It is already a good business practice to equality in Poland. It stipulates that Despite the above-mentioned differences include in the internal regulations and all men and women shall have equal in the earnings between men and policies, as well as in day-to-day practice, rights in family, political, social and women currently, there are no reporting the guarantees of diversity, inclusion and economic life, in particular regarding obligations under Polish law in relation to equal pay. education, employment and promotion. diversity and equal pay between men and It also stipulates they shall have the women. right to equal remuneration for work of At the EU level, work is currently equal value, to social security, to hold underway to strengthen the general offices, and to receive public honors and principle of equal pay for men and women decorations. within the EU. According to the proposed Moreover Polish Labor Code prohibits regulations, employers with 250 or more “any discrimination” in the field of employees will be obligated to report employment, either direct or indirect, regularly on pay, in an appropriate and in particular on the grounds of sex, age, transparent manner (e.g., by including disability, race, religion, nationality, information in their management reports). political beliefs, trade union membership, ethnic origin, faith, sexual orientation, and Collection of data on diversity employment for a definite or indefinite Due to the fact that data on employee term or on a full-time or part-time diversity usually constitute sensitive data, basis. Polish Labor Code provides that the collection thereof is restricted. employees should be treated equally in As a rule, processing of personal data terms of entering into and terminating revealing religious beliefs or sexual employment, terms of employment, orientation of the employees is prohibited promotion and access to training to in Poland. Nonetheless, it is possible to improve professional qualifications. It process such personal data based on the guarantees equal rights due to the equal consent of the employee, provided that performance of the same duties and the the transfer of such personal data takes Zuzanna Zakrzewska same remuneration for the equal work or place at the initiative of the employee. [email protected] for work of equal value. Therefore, it is forbidden for employers to Michał Włodarczyk ask for such personal data. [email protected]

28 | DE&I — Diversity, Equity & Inclusion Romania Anca Atanasiu

Diversity, equity and Legal framework on DE&I Conclusion inclusion The principle of equal treatment of all DE&I became one of the focal points employees and employers is at the heart in employment matters in Romania. Diversity, equity and inclusion are three of Romanian employment relations. More employers understand the need to principles that have been an ongoing topic Any direct or indirect discrimination develop a healthy corporate culture built for Romanian employment relationships against an employee, or discrimination by on these principles. during the past several years. More association, harassment or victimization is The importance of this topic is also companies are adhering to a corporate strictly prohibited. reflected in today’s workforce trends. culture where these principles are The protected criteria are race, Many employees seek inclusive cultures at the forefront. citizenship, ethnicity, color, language, where they can be themselves, have Nowadays, DE&I is no longer seen as religion, social origin, genetic features, flexibility and engage in purposeful work. a corporate trend but as a business sex, sexual orientation, age, disability, In this regard, employees feel safer in an imperative. Having a diverse workforce chronic non-contagious disease, inclusive environment where they have is steadily recognized as essential in HIV infection, political choice, family equal opportunities during the entire life improving a company’s performance. In situation or responsibility, membership cycle of their employment relationship: general, employees and teams perform or union activity, and membership of a starting with the hiring process and better and make better decisions when disadvantaged category. continuing with the way they are paid, diversity, equity and inclusion are trained, evaluated and promoted. The equal work/equal pay principle is embraced by their organizational culture. also regulated in Romania. Thus, when This also can translate into an increase in determining an employee’s salary or business profits. elements of the remuneration, any form EY in Romania, surveys on diversity of discrimination based on sex, sexual matters are usually performed voluntarily orientation, genetic features, age, national by private entities, but there are also membership, race, color, ethnicity, surveys and statistics on the level of religion, political choice, social origin, discrimination in Romania performed disability, family situation or responsibility, by the Romanian National Council for and membership or trade union activity is Combating Discrimination. strictly prohibited. Romanian business trends Failure to observe these prohibitions and discriminating in any way can result in Inspired by the European diversity a sanction by the labor authorities with movement, in 2018, Romania adopted fines between approximately EUR200 its own Diversity Charter, which seeks to and EUR4,100. establish a multi-stakeholder platform that addresses problems related to diversity In addition, companies with a breach of and inclusion. The entities signing the the equal work/equal pay principle may charter publicly commit to support and also be sanctioned by the National Council protect these principles to promote for Combating Discrimination with fines diversity, non-discrimination, inclusion between approximately EUR200 and and equal opportunities in the workplace. EUR6,100. Anca Atanasiu Multiple major Romanian employers have [email protected] already publicly signed and adhered to the principles of this charter. Ana Flueran [email protected]

DE&I — Diversity, Equity & Inclusion | 29 Russia Daria Zakharova

Diversity, equity and mechanisms lack effectiveness. Even if security; and to control the quantity the court rules in favor of the plaintiff, and quality of fulfilled work and safety. inclusion the plaintiff will receive nothing but Data on political, religious and other compensation for moral damage, which convictions, and private life is explicitly Discrimination legislation is usually not a substantial amount. In prohibited to be gathered by the Russian Russia has been a party to and has reality, claims on equality grounds have Labor Code. The employer is also not ratified most major human rights treaties not been common in courts. There are no allowed to obtain and process employees’ prohibiting discrimination. The prohibition official discrimination statistics. personal data on membership in public of discrimination is also set forth in the associations or trade union activities, Russian Federation Constitution, which Data on diversity matters except for the cases envisaged by labor stipulates that all individuals should be Criteria covered by anti-discrimination legislation. equal before the law. The state guarantees legislation include gender, race, ethnicity, the equality of human and civil rights nationality, language, origin, disability, No designated body and freedoms regardless of sex, race, family status, age, place of residence, There is no specially designated body nationality, language, origin, material religion, political beliefs, or membership for the promotion of equal treatment of and official status, place of residence, or non-membership of voluntary all individuals without discrimination. attitude to religion, convictions, organizations. Accordingly, there are no specific membership of public associations, or Some of the above is mandatory data reporting requirements on diversity of other circumstances. All forms of gathered by an employer at hiring and is issues in employment relations or equal limitations of human rights on social, updated during the lifetime of employment pay between men and women. Human racial, national, language or religious relation, namely gender, disability, rights ombudsmen theoretically may grounds are prohibited. Men and women family status, age, place of residence deal with such issues and there are a few enjoy equal rights and freedoms and and citizenship. Disability, gender, age examples when regional human rights equal opportunities to exercise them. The and number of foreign employees are ombudsmen have launched projects to Labor Code of the Russian Federation also criteria with compulsory reporting and monitor discrimination in employment, contains a prohibition of discrimination communication to a public administration. but these are local initiatives rather than in the sphere of labor to secure equal These criteria are associated with special common practice. opportunities for everybody and ensure treatment and/or certain law guarantees, that no one suffers discrimination. and, therefore, must be collected. Implementation For example, an employer is required to grant an additional (unpaid) leave of Although well laid out as general values, up to 14 calendar days upon a senior in practice the above principles are not employee’s request. When recruiting detailed enough to address everyday pensioners, an employer has the right cases that employees and employers to conclude a fixed-term employment are dealing with and to ensure effective contract because of the employee’s protection against discrimination. For retirement age. example, there is no specialized body to deal with discrimination issues. To date, The general labor law principle is that it has been the exclusive prerogative of processing of employees’ personal data courts to deal with discrimination at work. may be carried out exclusively to ensure The available discrimination complaint observation of laws; to assist employees in obtaining employment, training and promotion; to ensure employees’ personal Daria Zakharova [email protected]

30 | DE&I — Diversity, Equity & Inclusion Singapore Evelyn Ang

Collection of data for or disclosure of the data; or where the Additionally, organizations should note collection, use or disclosure of the data that the Tripartite Guidelines on Fair diversity, equity and without the consent of the individual is Employment Practices issued by the inclusion programs required or authorized under the PDPA or Tripartite Alliance for Fair & Progressive any other written law. Employment Practices, state that only Singapore has often been regarded as a questions relevant to assessing an society where diversity is encouraged. Organizations seeking to collect, use applicant’s suitability for a job should be An increasing number of companies or disclose personal data in relation to asked in job application forms and at job are formulating their diversity, equity diversity matters should ideally collect, interviews. Questions relating to age, and inclusion programs to ensure that use or disclose such data with the consent race, religion, gender, marital status and employees are accorded dignity and of the employees to whom such data family responsibilities, or disability that respect, regardless of their race, religion, relates. Before obtaining such consent, are irrelevant to suitability should not be gender, nationality, sexual orientation the employees should be notified of the included. Employers should conduct fair or political opinion. These companies purposes for which their personal data recruitment and selection based on merit will first need to collect data on diversity is collected, used or disclosed. Such regardless of the above factors to avoid matters before improvements and best purposes should be what a reasonable giving rise to misunderstanding and the practices can be proposed. person would consider appropriate in the circumstances. perception of discrimination. Collection, use and disclosure of data Alternatively, organizations may collect, Specific reporting requirements on diversity matters use or disclose personal data in relation The Code of Corporate Governance, In Singapore, the Personal Data Protection to diversity matters without employees’ which applies to all listed companies in Act 2012 (No. 26 of 2012) (PDPA) consent insofar as such collection, use or Singapore, requires every listed company defines “personal data” as data, whether disclosure is reasonable for the purpose of to have a board diversity policy, including true or not, about an individual who can or in relation to the organization entering qualitative and measurable quantitative be identified (a) from that data, or (b) into an employment relationship with the objectives (where appropriate). The board from that data and other information to individual or appointing the individual to should comprise directors who as a group which the organization has or is likely to any office, or managing or terminating provide the appropriate balance and mix have access. the employment relationship with or of skills, knowledge, experience, and other appointment of the individual. However, If any data on diversity matters that is aspects of diversity such as gender and the organizations must inform employees collected by an organization falls within age. The board diversity policy is to be of the purpose for which the employees’ the definition of “personal data,” the disclosed in the company’s annual report, data is collected, used or disclosed; organization will have to comply with the which may be found on the company’s and upon request by an employee, the obligations set out under the PDPA in official website and/or on the Singapore business contact information of a person relation to such data. Exchange’s website. who is able to answer the employee’s Under the PDPA, an organization may questions about such collection, use or only collect, use or disclose personal disclosure on behalf of the organization. data about an individual under several circumstances: where the individual gives, or is deemed to have given, his consent under the PDPA to the collection, use Evelyn Ang [email protected]

Kayleigh Wee [email protected]

DE&I — Diversity, Equity & Inclusion | 31 South Africa Claire Hock

Employment equity and Gathering data on affirmative action Slow progress affirmative action beneficiaries Ineffectual enforcement by the Designated employers are required to Department has resulted in relatively The Bill of Rights in the South African develop an employment equity plan to slow affirmative action progress although constitution recognizes that affirmative address barriers to the employment recent amendments to the Income action measures can be designed to and advancement of designated groups; Differential Statement will allow for promote the achievement of equality report annually to the Department of improved analysis. among persons or categories of persons Employment and Labour on progress previously disadvantaged by unfair against this plan, using a prescribed discrimination. template; and report on income The Employment Equity Act 55 of 1998 differentials between the different was enacted to give effect to this right. designated groups, using a prescribed This statute places general and specific template signed by the Chief Executive obligations on employers. All employers Officer. This template requires reporting must eliminate unfair discrimination in any of total fixed and variable remuneration employment policy or practice. Larger per occupational level (there are six employers (50 employees or more) are occupational levels defined from required to implement affirmative action “unskilled” to “top management”) and for employees who are members of number of employees according to race, designated groups. gender and foreign nationals.

Affirmative action beneficiaries Penalties for non-compliance Designated groups (i.e., the beneficiaries Enforcement of affirmative action is of affirmative action) are defined as via the Department of Employment and black people, women and people with Labour. An inspector will either secure a disabilities who are South African citizens written undertaking from the employer by birth or descent or who became South to comply or issue a compliance order in African citizens by naturalization prior to the first instance. If compliance does not the advent of democracy. Black people ensue, a penalty may be ordered by the are defined as Africans, Coloureds1 and Labour Court. Maximum penalties for non- Indians. People with disabilities are defined compliance without prior contraventions as people with a “long-term or recurring range from ZAR1.5million to 2% of the physical or mental impairment which employer’s turnover, whichever is greater. substantially limits their prospects of entry Individual cases of alleged unfair into, or advancement in employment.” discrimination are initially channeled Affirmative action is aimed at ensuring through the Commission for Conciliation, that these beneficiaries are equally Mediation and Arbitration and then on to represented in the workplace as they are the Labour Court. in the economically active population.2

1. In South Africa, this term historically denoted people of mixed race. Claire Höck 2. Defined as those between 15 and 64 who are [email protected] either employed or actively seeking employment.

32 | DE&I — Diversity, Equity & Inclusion Spain Raul Luis Garcia Gonzalez

Diversity, equity and A further step was taken with the fine from EUR6,251 to EUR187,515. In publication of two complementary royal addition, companies could be excluded inclusion decrees: from public tenders by being legally barred from entering into contracts with Personal data treatment • Royal Decree 901/2020, of October the public sector. In Spain, according to the Organic Law 13, 2020, on equality plans, requires All of this is reflected in the obligations on the Protection of Personal Data, any companies with 100 or more employees regarding non-financial information, information related to an identified or to negotiate an equality plan by March which was reinforced in 2018, with the identifiable natural person (e.g., birth, 7, 2021. Companies with 50 or more publication of Law 11/2018, which marriage or religious convictions) may be employees must negotiate an equality increased the number of companies that considered sensitive personal data. plan by March 7, 2022, and companies are required to present the statement that already have an equality plan Personal data that includes information of non-financial information. It has must ensure compliance with the Royal regarding racial origin, health, sexual introduced a new significant change Decree by January 14, 2022. orientation, religion and beliefs may regarding the selection of directors in only be collected and processed when a • Royal Decree 902/2020, of October listed companies and the importance of law requires it, based on public interest 13, 2020, on equal payment for women respecting the principle of diversity and grounds or with the specific consent of the and men, has led to major changes promoting the election of female directors data subject. in the area of equality by requiring in a number that allows for a balance This requirement also applies in the companies to keep a remuneration between men and women on the board context of employment and must be register covering all employees, of directors. respected by companies when considering including executives and senior Spain is one of the countries with the most potential candidates in recruitment managers. An explanation must be advanced legislation in terms of diversity processes unless this information included for any gender pay gap that is and equality. is relevant to the performance of 25% or above. It is expected that in the near future, the position and not indiscriminate In addition, the obligation to comply with companies can continue to incorporate information. the principle of equal pay for men and different measures that help to ensure New challenges: diversity and women has been reinforced in recent the protection of all employees in the workplace so that equal treatment inclusion policies years, in particular through the following instruments: between men women in the workplace In this era in which diversity is of vital becomes a reality. importance, employers’ awareness of • Remuneration register gender equality, diversity and inclusion, among others, is becoming more • Workers’ right to information and highly valued. access to their company’s pay register In general terms, diversity must be • Remuneration audit approached from different standpoints to advance public awareness. Therefore, this Failure to comply with this rule, besides requires a change not only in companies, possibly having a penalty imposed by but also in society. the labor inspectors, may be classified as: (i) serious with a fine from EUR626 to EUR6,250; or (ii) very serious with a Raul Luis Garcia Gonzalez [email protected]

Isabel Merenciano [email protected]

DE&I — Diversity, Equity & Inclusion | 33 Sweden Paula Hogéus

Diversity, equity and promotion, education and professional the workplace and measures taken by the development, and opportunities for employer rather than collecting data on inclusion combining work and parenthood. employees. No mapping should be done at In recent years, diversity, equity and Employers must also develop, follow up the individual level, and any investigation inclusion have been a growing focus for and evaluate guidelines and routines must be conducted in such a manner that many businesses, not only in Sweden but for preventing harassment, sexual any sensitive personal data cannot be globally. There has been a clear push to harassment and reprisals, and carry out linked to an individual employee. prioritize diversity in the workplace, with an annual salary survey to identify any In light of the above, employers should businesses recognizing the many benefits gender pay gaps. consider introducing clear policies and of a diverse workforce. guidelines regarding their DE&I work. Reporting obligations At the end of 2020, the Swedish Additionally, these policies and guidelines government presented an inquiry on how The Discrimination Act does not impose should include information on the the enforcement of current discrimination any general reporting obligations for processing of personal data to minimize legislation can be more effective. Since employers. However, employers with the risks of non-compliance with data the inquiry may result in stricter sanctions more than 25 employees are required to protection regulations. for non-compliance, employers will need document their work with active measures to be aware of Swedish anti-discrimination in writing. Employers with fewer than 25 regulations. but more than 10 employees are only required to document the salary surveys The Discrimination Act in writing. The responsibilities of employers in regard The Equality Ombudsman supervises to equal treatment in the workplace compliance with the Discrimination Act are governed by the Discrimination and may bring a court action on behalf of Act (2008:567). There are seven an individual who consents. If an employer grounds of discrimination covered by does not fulfill its obligations with regard the Discrimination Act: sex, transgender to active measures, it may be ordered to identity or expression, ethnicity, do so subject to a financial penalty. religion or other belief, disability, sexual orientation and age. Gathering data and measuring The rules prohibit both direct and indirect diversity discrimination at the workplace and apply In their efforts to achieve more diversity to all aspects of the business. Further, in the workforce, many employers are employers have a responsibility to take wondering what kind of data they can “active measures.” gather as part of their diversity work. This requires employers to carry Legal regulations on the processing of out continuous work in four stages: personal data (e.g., the General Data investigating, analyzing, taking measures, Protection Regulation) prohibit the and monitoring and evaluating. The processing of sensitive personal data work shall be carried out in cooperation unless there is an applicable exception. with employees and cover the following Further, asking employees for personal Paula Hogéus areas: working conditions, provisions and details may be seen as inappropriate. [email protected] practices regarding salaries and other Thus, when measuring diversity, it is best terms of employment, recruitment and practice to focus on general conditions at Melika Rajaee [email protected]

34 | DE&I — Diversity, Equity & Inclusion Switzerland Marc Philipp Gugger

Diversity, equity and Diversity data For this reason, even the explicit consent of the employee would in general not be inclusion Data on gender must be collected to comply with this legal obligation. Gender, sufficient to justify the breach of general The topic of diversity, equity and inclusion civil status and whether an employee data protection principles even if certain has gained enormous importance, has children is already part of an narrow exceptions may exist. To adhere particularly in recent years. Organizations employee’s personnel file, as this data is to these principles and in particular to and consulting firms are dedicated decisive regarding maternity/paternity the principle of proportionality, both the to supporting employers to take leave, family allowances, etc. A physical gathering as well as processing of the responsibility in this regard. impairment of an employee is often also relevant data on diversity, equity and known (to a limited extent), as employees inclusion must occur anonymously. Only Equal pay analysis tend to turn to their employer if their the use of anonymized data exclusively for Equal pay for men and women is a impairment makes adjustments to the statistical purposes can be considered a constitutionally protected fundamental workplace or work materials necessary. legal justification in this sense. right, even if its implementation is not Other categories of data that are equally strict in every industry and Conclusion protected against discrimination (e.g., company. In addition, the Federal Gender Even though anonymous gathering origin, religion, political interests, sexual Equality Act protects against unequal and processing of diversity data can be preferences, and physical or mental treatment for men and women. challenging, It is best practice for an impairments) are usually not gathered, employer to attach great importance to To better enforce equal pay for men and since a specific legal basis to gather such diversity, equity and inclusion. This is women on the highest political level, an data does not exist. amendment to this act and its associated necessary not only to comply with equal ordinance came into force on July 2020 Data gathering pay rules but also because business performance can be improved by for an initial limited period of 12 years. Data gathering and processing without developing employees with diverse talents To achieve the set goal, employers with a legal basis and purpose require and backgrounds. This topic is often more than 100 employees are required to compliance with further data protection part of a company’s social responsibility carry out an internal anonymized equal principles such as proportionality strategy to remain competitive and pay analysis every four years, to have and necessity; this does apply to data attractive as an employer. this audited by an independent external requiring special protection, which in body, and to communicate the results principle includes data on diversity to employees and — if the companies matters. are listed on the stock exchange — to Even though a general legal basis for shareholders. data gathering on diversity matters does The act does not provide for direct not seem to exist on the required level, sanctions if an equal pay analysis is not data protection principles are adhered carried out or if the results show gender- to in case a respective justification specific salary differences. However, may be found. The general right and besides possible reputation damage to obligation of the employer to create and the company, such results may lead to an process personality profiles as part of increase in employee claims since they an employee’s personnel file may not be have a direct information right, including seen as such a justification since diversity Marc Philipp Gugger the right to ask detailed questions. matters are not required for this purpose. [email protected]

Aline Nussbaumer [email protected]

DE&I — Diversity, Equity & Inclusion | 35 United Kingdom Rob Riley

Diversity, equity and Special categories of personal data are Gender pay gap reporting applies those revealing, for example, racial or to employers who have at least 250 inclusion ethnic origin, religious beliefs or sexual employees as of 5 April each year. Public Recent research found that almost orientation. Under the data protection authorities and government departments half of the UK’s workforce thinks that law in the UK, processing personal data must also comply with separate (but diversity and inclusion should be more that falls within special categories is largely similar) obligations. Gender of a priority in the workplace. Promoting prohibited unless the employer can show pay gap reporting does not involve the and supporting diversity in the workplace that it has a lawful basis for collecting processing of special category data, is an important aspect of good people and processing the data and that it has but salary information is nevertheless management. Section 4 of the Equality fulfilled one of the conditions provided sensitive data. Act 2010 covering the nine protected under the data protection law (such as Failure to publish a gender pay gap report characteristics (e.g., disability, race, the employee providing the employer if required may result in the UK’s Equality religion or gender) sets minimum with explicit consent to process the and Human Rights Commission taking standards by preventing an employer data). An employee privacy notice will be enforcement action against employers. from discriminating against an employee required to comply with an employer’s There are also reputational risks if an on account of any of the protected transparency obligations under the employer is non-compliant. characteristics. However, employers are GDPR, in addition to a data protection increasingly recognizing the benefits of impact assessment being carried out Leading practice having a diverse and inclusive culture before undertaking diversity monitoring. Diversity and inclusion monitoring that goes way beyond the need to ensure Breaches of an employer’s requirements helps better equip employers to identify compliance with legal obligations. under the data protection law may issues with various equality obligations result in enforcement actions by the and the wider need to ensure a diverse Gathering diversity data UK’s Information Commissioner’s Office and inclusive culture and workforce. To promote and support diversity and such as enforcement notices, monetary Monitoring helps employers shape better inclusion in the workplace, employers fines or legal prosecution. Breaches of and more effective policies around often carry out diversity monitoring, and data protection obligations may result in recruitment, reward and promotions, and there are some specific circumstances in reputational damage and employment helps make the workplace a better and which employers are required to carry out law claims. more attractive place for talent. diversity monitoring (such as gender pay gap reporting). Gender pay gap reporting When carrying out diversity monitoring, Under the Equality Act 2010 (Gender employers are bound by the General Data Pay Gap Information) Regulations 2017 Protection Regulation (GDPR) and the (GPG Regulations), some employers have Data Protection Act 2018. Under this an obligation to publish an annual report legislation, employers must process their containing data on their gender pay gap employees’ data in a fair and transparent to show whether there are pay differences way and only collect personal data for between male and female employees. specific purposes. When gathering data There are growing calls in the UK for the on diversity, this may involve employers requirement to also extend to ethnicity processing “special category” data. pay gap reporting.

Rob Riley [email protected]

36 | DE&I — Diversity, Equity & Inclusion DE&I — Diversity, Equity & Inclusion | 37 EY Contacts for Labor and Employment Law Services

For further information, please contact: EY Global Labor and Employment Law EY Global Labor and Employment Law Markets Leader Leader Roselyn Sands Paula Hogeus Direct: +33 1 55 61 12 99 Direct: +46 8 520 599 99 Mobile: +33 6 71 63 92 22 Mobile: +46 72 503 80 85 [email protected] [email protected]

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38 | DE&I — Diversity, Equity & Inclusion EY Labor and Employment Law Newsletter Coordinator Sanjee Jayas Direct: + 33 1 55 61 11 36 [email protected]

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DE&I — Diversity, Equity & Inclusion | 39 Recent EY publications

40 | DE&I — Diversity, Equity & Inclusion EY Labor & Employment Law Guide on Business Transformation

Multinational companies must constantly transform their This guide functions as an information repository for HR teams, business operations to compete on the world market and General Counsel and C-suite members seeking a comprehensive meet their business objectives. summary of the significant issues and challenges that may be encountered around the world. It provides practical answers, The EY Labor & Employment Law Digital Guide on enabling organizations to anticipate and mitigate potential risks. Business Transformation highlights current Labor and This digital guide is updated on an ongoing basis but should Employment Law topics of strategic importance for not be relied upon as legal advice. You should consult with your multinational companies on a jurisdiction-by-jurisdiction local EY Law teams to check for latest developments. The EY basis. organization does not practice law where we are not permitted to do so by local law. No legal advice will be provided in the United States of America.

Labor and Employment Law Digital Guide

DE&I — Diversity, Equity & Inclusion | 41 The COVID-19: Return to office — Legal Requirements and Considerations tracker will provide regular updates on the key reputational, strategic and human resources questions to be considered by the employers.

Download our Return to office — Legal Requirements and Considerations tracker (pdf) to understand the regulations governing this area in more than 60 jurisdictions. Click to download

42 | DE&I — Diversity, Equity & Inclusion COVID-19: labor and employment guide

The labor and employment law COVID-19 guide provides a snapshot of considerations and includes information for employer rights, obligations, furlough and government incentives.

Learn more

DE&I — Diversity, Equity & Inclusion | 43 Global labor and employment law strategic topics

Labor & Labor & Employment Law Employment Law Strategic Global Strategic Global Topics Topics Summer 2017 edition Religion in the workplace Fall 2017 edition Top 10 labor and employment law risks around the world

Summer 2017: Fall 2017: Top 10 labor 2018 Edition #1: 2018 Edition #2: Religion in the workplace and employment law Sexual Harassment Global LEL Strategic risks around the world Law in the workplace Topics Workforce around the world Restructuring To download the report, To download the report, To download the report, To download the report, click here. click here. click here. click here.

Global Labor and Employment Law strategic topics Whistle-blowing and Ethics 2018 Edition #3

2018 Edition #3: 2019 Edition: 2019 Edition #2: 2020 Edition #1: Global LEL Strategic Ageism and the Employment The ever increasing Topics Whistle-blowing Workplace documentation importance of ensuring and Ethics management globally health and well-being in To download the report, To download the report, the workplace in 2020 click here. click here. To download the report, To download the report, click here. click here.

Global labor and employment law strategic topics

Workforce transformation and restructuring in 2021

April 2021 Edition

Glad to present our 25th Edition

2020 Edition #2: 2020 December Workforce COVID-19: Edition: Reimagining transformation and Workplace Challenges work globally restructuring in 2021 For more Now and Beyond information, please visit the To download the report, To download the report, To download the report, EY Law website. click here. click here. click here.

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