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Permanent Employees Earning Less Than Adequate Wage
Permanent Employees Earning Less Than Adequate Wage
Updated over a week ago

**This metric was added from the 2023 Sustainable Finance Disclosure Regulation (SFDR) Final Report on Draft Regulatory Technical Standards.

This metric is intended to capture the number of unique individuals employed by the organization in full-time or part-time roles (not including workers in temporary or contractor roles) who were not paid an adequate wage during the reporting period.

For purposes of this metric, employee wages should be based on the basic wage plus any fixed additional payments that are guaranteed to all employees.

Organizations should determine adequate wage based on employee location for each country in which the organization has operations, except outside the European Economic Area (EEA) when the relevant adequate or minimum wage is defined at a sub-national level.

Adequate wage is defined as follows by the European Union:

  1. In the European Economic Area (EEA) countries: The minimum wage set in accordance with Directive (EU) 2022/2041 of the European Parliament and of the Council on adequate minimum wages in the European Union. In the period until Directive (EU) 2022/2041 enters into application, where there is no applicable minimum wage determined by legislation or collective bargaining in an EEA country, the undertaking shall use an adequate wage benchmark that is either not lower than the minimum wage in a neighboring country with a similar socio-economic status or not lower than a commonly-referenced international norm such as 60% of the country's median wage and 50% of the gross average wage. Directive (EU) 2022/2041 on adequate minimum wages in the European Union references both indicative reference values commonly used at international level such as 60 % of the gross median wage and 50 % of the gross average wage, and/or indicative reference values used at national level. Data for the indicative values of 60% of the national median gross wage or 50% of the national average gross wage can be obtained from the European Labour Force Survey.

  2. Outside of the EEA:

    1. The wage level established in any existing international, national or sub-national legislation, official norms or collective agreements, based on an assessment of a wage level needed for a decent standard of living;

    2. If none of the instruments identified in (a) exist, any national or sub-national minimum wage established by legislation or collective bargaining; or

    3. If none of the instruments identified in (a) or (b) exist, any benchmark that meets the criteria set out by the Sustainable Trade Initiative (IDH) (‘Roadmap on Living Wages - A Platform to Secure Living Wages in Supply Chains’), including applicable benchmarks aligned with the Anker methodology, or provided by the Wage Indicator Foundation or Fair Wage Network, provided the primacy of collective bargaining for the establishment of terms and conditions of employment is ensured.

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