A
Adjusted Gender Pay Gap
DE: Bereinigter Gender Pay Gap
The gender pay gap after controlling for objective factors such as qualifications, experience, industry, working hours and scope of responsibility using multivariate regression. The adjusted gap isolates the portion of the pay difference not explained by legitimate factors. Under the EU Pay Transparency Directive, an adjusted gap exceeding 5 percent in an equivalent-work group triggers a joint pay assessment (Article 10, Directive 2023/970).
B
Burden of Proof (Reversed)
DE: Beweislastumkehr
Under Article 18 of Directive 2023/970, the burden of proof in pay discrimination cases shifts to the employer. The employer must demonstrate that there has been no direct or indirect pay discrimination — rather than requiring the employee to prove discrimination exists. This reversal significantly increases the importance of documentation and data quality.
C
Comparator Group
DE: Vergleichsgruppe
A group of employees performing equal or equivalent work as defined by the directive. The formation of comparator groups is the foundation of every pay equity analysis. A typical mid-market employer with 500 employees ends up with 15 to 25 comparator groups, each of which must be analysed, justified and monitored individually.
Compensation Structure
DE: Verguetungsstruktur
The totality of rules determining how pay is set in an organisation: salary bands, collective agreements, variable compensation, allowances and benefits in kind. Directive 2023/970 requires compensation structures to be gender-neutral and based on objective criteria.
E
EEOC (Equal Employment Opportunity Commission)
US federal agency
The US federal agency responsible for enforcing federal employment discrimination laws, including the Equal Pay Act and Title VII. The EEOC collects pay data through the EEO-1 Component 2 report (currently suspended but expected to return). EEOC enforcement focuses on individual complaints rather than the proactive reporting model of the EU directive.
Equal Pay Act (US, 1963)
US federal law
US federal law prohibiting sex-based pay differences for substantially equal work (same skill, effort, responsibility and working conditions) within the same establishment. Unlike the EU directive, the Equal Pay Act requires "equal" rather than "equivalent" work, does not mandate proactive reporting and does not reverse the burden of proof. Employers may justify differentials based on seniority, merit, quantity/quality of production, or any factor other than sex.
Equivalent Work
DE: Gleichwertige Arbeit
Work of equal value assessed on gender-neutral criteria: skill, effort, responsibility and working conditions as defined in Article 4(4) of Directive 2023/970. Two jobs are equivalent even if the actual tasks differ completely — a nurse and a technician may perform equivalent work if the demands across all four criteria are comparable. This is broader than the US "substantially equal work" standard.
G
Gender Pay Gap
DE: Geschlechtsspezifisches Lohngefaelle
The percentage difference in average gross hourly pay between men and women. Distinguished as unadjusted (raw difference) and adjusted (after controlling for objective factors). EU average 2023: 12.0 percent (Eurostat). The pay transparency report under Article 9 must disclose the unadjusted gap as both median and mean.
Gender-Neutral Job Evaluation
DE: Geschlechtsneutrale Arbeitsbewertung
A job evaluation system free from gender bias. Article 4(4) of Directive 2023/970 defines four criteria: skill, effort, responsibility and working conditions. Pay equity software implements these criteria in job architecture modules to build equivalent-work groups.
J
Job Architecture
DE: Jobarchitektur
The systematic organisation of all roles in a company into job families, career levels and pay bands. Job architecture provides the foundation for building equivalent-work groups under the directive. Pay equity software includes modules for creating and maintaining job architectures.
Joint Pay Assessment
DE: Gemeinsame Entgeltbewertung
A mandatory assessment under Article 10 of Directive 2023/970, triggered when a pay gap report reveals an unexplained differential exceeding 5 percent in an equivalent-work group and the employer cannot justify it on objective, gender-neutral grounds or correct it within six months. Must be conducted jointly with employee representatives and must include concrete remediation measures.
L
Lilly Ledbetter Fair Pay Act (US, 2009)
US federal law
US federal law that reset the statute of limitations for filing equal pay discrimination claims with each discriminatory paycheck, reversing the Supreme Court's narrow interpretation in Ledbetter v. Goodyear (2007). The act extended the window for bringing claims but did not add proactive reporting requirements or reverse the burden of proof.
M
Median
DE: Median
The statistical middle value where exactly half of all observations fall above and half below. Directive 2023/970 requires pay gap reports to disclose the median gender pay gap (Article 9(1)(a)) because the median is more robust to outliers than the arithmetic mean.
Multivariate Regression
DE: Multivariate Regressionsanalyse
A statistical method used to calculate the adjusted gender pay gap. The regression isolates the effect of gender on pay after controlling for other explanatory variables (experience, qualifications, role, working hours). Standard methodology in pay equity software.
O
OFCCP (Office of Federal Contract Compliance Programs)
US federal agency
Division of the US Department of Labor responsible for ensuring federal contractors comply with non-discrimination and affirmative action obligations, including equal pay. Federal contractors with 50+ employees and contracts exceeding USD 50,000 must maintain affirmative action plans and are subject to compliance audits that include compensation analysis.
P
Pay Equity
DE: Entgeltgleichheit
The principle that equal or equivalent work must receive equal pay regardless of gender. In the EU, the legal basis is Article 157 TFEU and Directive 2023/970. In the US, the framework includes the Equal Pay Act (1963), Title VII of the Civil Rights Act (1964) and state-level pay equity statutes.
Pay Equity Software
DE: Pay Equity Software
Specialised HR software for analysing, monitoring and ensuring pay equity. Core functions: statistical gap analysis, job architecture, automated reporting, remediation simulation and HRIS integration. See the software comparison for a detailed vendor evaluation.
Pay Transparency
DE: Lohntransparenz / Entgelttransparenz
The disclosure of pay information to employees, candidates and authorities. The directive distinguishes between pre-employment transparency (pay ranges in job postings, Article 5), during-employment transparency (right to information, Article 7) and transparency to authorities (reporting obligation, Article 9).
Pay Transparency Directive
DE: Entgelttransparenzrichtlinie
Directive (EU) 2023/970 of the European Parliament and of the Council of 10 May 2023 to strengthen the application of the principle of equal pay for equal work or work of equal value between men and women through pay transparency and enforcement mechanisms. Transposition deadline: 7 June 2026.
R
Reporting Obligation
DE: Berichtspflicht
The obligation for employers to publish regular pay transparency reports. Under Directive 2023/970: employers with 250+ employees report annually, 150-249 every three years, 100-149 every three years (first report by 7 June 2031). Member States may extend below 100 employees.
Right to Information
DE: Auskunftsanspruch
The right of every employee to request information about their own pay level and the average pay levels of the comparator group broken down by sex (Article 7). Applies to all employers regardless of size. Response deadline: two months. Must be provided in an accessible format.
T
Title VII (Civil Rights Act, 1964)
US federal law
Title VII of the US Civil Rights Act prohibits employment discrimination based on race, colour, religion, sex and national origin. Unlike the Equal Pay Act, Title VII covers all forms of compensation discrimination (not just equal work) and allows claims based on disparate impact. However, it does not require proactive reporting or reverse the burden of proof in the way the EU directive does.
U
Unadjusted Gender Pay Gap
DE: Unbereinigter Gender Pay Gap
The raw median difference in gross hourly pay between men and women without any statistical controls. Includes structural factors such as industry distribution and part-time rates. EU average 2023: 12 percent (Eurostat). The pay transparency report under Article 9 must disclose the unadjusted gap as both median and mean.
W
Work of Equal Value
DE: Gleichwertige Arbeit
See Equivalent Work. The directive uses "equal work or work of equal value" as the standard for comparison. Work of equal value is determined by assessing jobs on the four gender-neutral criteria defined in Article 4(4): skill, effort, responsibility and working conditions.
Frequently asked questions
What is the difference between adjusted and unadjusted gender pay gap?
The unadjusted gap is the raw median difference without controls (EU average 2023: 12%). The adjusted gap uses regression to control for experience, qualifications, industry and working hours. The EU directive targets the adjusted value: if it exceeds 5% in an equivalent-work group, a joint pay assessment becomes mandatory.
What does equivalent work mean under the EU directive?
Two jobs are equivalent when they score comparably on four gender-neutral criteria: skill, effort, responsibility and working conditions (Article 4(4)). A nurse and a technician may perform equivalent work even if their tasks differ completely. This is broader than the US "substantially equal work" standard under the Equal Pay Act.
How does the US Equal Pay Act differ from the EU directive?
The Equal Pay Act covers "substantially equal work" (same skill, effort, responsibility, conditions) within one establishment. The EU directive covers "equivalent work" across the employer, requires proactive reporting, sets a 5% action threshold, and reverses the burden of proof. The Lilly Ledbetter Act extended the US statute of limitations but did not add reporting requirements.