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The most common mistake after a pay gap signal of five percent

Many employers respond to a pay gap signal as if it were a verdict and skip the documentation step. That costs time in the six months that follow.

A pay gap signal of five percent or more is not a statement about whether a difference is justified. Yet that is precisely the mistake most often made: employers read the signal as a conclusion, and respond accordingly — by hastily adjusting salaries or, conversely, by disregarding the signal because "it must be an explainable difference". Both reactions miss the point: the six months that follow a signal are meant to get the supporting evidence in order, not to pass judgment immediately.

The regulation requires that an employer, if a difference of five percent or more appears within a job category, investigates together with worker representatives whether that difference can be explained on objective, gender-neutral grounds. That investigation takes time and requires documentation that often does not yet exist: a clear job classification, established pay criteria, and an overview of who falls into which category and why. Those without these documents waste a large part of the six months reconstructing them instead.

What goes wrong in practice

In most cases, the mistake lies not in bad faith, but in sequence. A signal arrives, an internal response follows — often from management or an enthusiastic HR manager — and that response is substantive before the facts are complete. There is talk of "correcting" while it has not yet been established whether there is anything to correct, or there is talk of "coincidence" while the underlying job classification was never determined and thus cannot be tested.

A second, less visible mistake is that worker representation is involved too late or too superficially. The regulation is explicit on this: the investigation into explaining a difference happens together with representatives, not afterwards for information. A discussion conducted only in the final weeks of the six months rarely produces a carefully substantiated result.

Why this is so persistent

The cause usually lies in what was already missing before the signal. A signal exposes a difference within a category, but categories of equal work must be established on the basis of objective criteria in order to say anything meaningful about them. Employers who have never explicitly made this classification — and there are many, especially in SMEs where jobs have grown historically — thus have no starting point. The signal then comes not only as news, but also as the starting point for work that should have been done already. To learn more about what this classification looks like, read the knowledge base on job classification and equal work.

What the six months actually require

The period after a signal is meant for three things: determining whether the job category is correctly defined, investigating which factors explain the difference, and documenting that investigation together with worker representatives. None of these steps requires a judgment from outside about whether the difference is justified — the employer assesses this themselves, possibly with legal advice, not an external system. What does help is a starting point that makes clear where you stand right away. With a few questions that map out your situation you can see whether the signal is relevant for your organization and what is already established.

How to prevent this

The most effective correction is straightforward: ensure the supporting documentation is in place before a signal arises. This means a job classification on paper, a remuneration policy that explains which criteria are applied, and a fixed procedure for when worker representatives must be involved. Whoever arranges this through a fixed system instead of ad hoc in response to each signal saves the majority of the six months in practice. How such a system is structured and where the underlying information comes from is described on the page on how the system works.

It remains important to maintain a clear distinction between structuring and assessing. A five percent signal indicates that there is a difference within a category; it says nothing about the reason for it. Determining that reason, and possibly having it legally reviewed, is the responsibility of the employer and, where necessary, of a lawyer or the competent supervisory authority — not of the system that provides the figures.

Would you like to know whether your organization already has a job classification and remuneration policy that can withstand a signal, or what it costs to put that in order? Do the free quick-scan or view what is included per component in the subscription.

This article is general information and not legal advice.