The media coverage of the Women’s World Football Cup earlier this year brought into focus the controversy surrounding the pay gap between female football players and male football players in the international arena.
Status Quo in Germany
A gender pay gap exists amongst footballers in Germany too: The women playing football in the first division of the German Bundesliga earn on average 3,500 EUR/month. Men’s pay in the first division of the Bundesliga tends to be confidential but is understood to range from 30,000 EUR/month to as high as 500,000 EUR/month when add-ons such as appearance and win bonuses are accounted for. Political debates aside, this article considers the employment-law perspective on gender pay gaps in football, particularly the first division of the Bundesliga.
Equal-Pay-Principles
The equal pay principle is an integral part of German employment law and is reflected in a number of statutory provisions. At a constitutional level, it stems from Article 3 of the Basic Law (GG), which is aligned to the general principle of equal treatment under German labour law. An employer may not exclude an employee or a group of employees from generally applicable employee benefits or place them in a worse position than other employees who are in a comparable position. In addition, there are two relevant statutes: the General Equal Treatment Act (AGG) and the Payment Transparency Act (EntgTranspG).
Not every instance of unequal treatment breaches the law. Firstly, it needs to be determined whether the alleged unequal/discriminatory treatment is direct or indirect. Secondly, whether the treatment may be justified. In the case of unequal/discriminatory treatment which is unjustified the employee has a right to information and claim for damages, as well as a right of appeal and right to refuse performance. Any underlying discriminatory agreement would also be void.
Can gender pay gaps potentially be justified?
Whether female players could bring a successful claim for equal payment (and damages) depends on whether there is a valid justification for any difference in pay.
Whether any alleged discrimination is direct or indirect affects the validity of any potential justification. A comparator is also required to assess whether discrimination has in fact occurred. The relevant comparator for the female players of the women’s first division in the Bundesliga would be the male players of the men’s first division in the Bundesliga.
There would be direct discrimination affecting pay in comparison to a reference person who does the same or equivalent work if the difference in pay were to be based directly on the sex of the worker (for example, if the employer decides to pay female footballers less than male footballers, simply because they are female). The sex of the workers would need to be the express distinguishing criteria for any difference in pay.
Whether female football players do the same or equivalent work in comparison to their male counterparts depends on the tasks they perform. Multiple factors come into play to determine if the work is equivalent – the kind of work, educational requirements and working conditions. Irrelevant for the purpose of this assessment is the quality of the work in question.
The only real justification for any apparent direct discrimination in an employment context would be where there are different occupational requirements for a role. The kind of work and the working conditions in the football sector are the same for men and women (i.e. there are no differences in occupational requirements). Therefore, if there were to be direct discrimination based on the sex of the players, it would clearly breach the principle of equal treatment.
Indirect discrimination affecting pay could arise when a seemingly neutral provision, criterion or practice affects the payment of workers of one sex more than another.
A seemingly neutral criterion could be the type of football competition. Different competitions generate considerably different levels of interest. On average, a game in the first division of the men’s Bundesliga during the 2022/23 football season attracted an attendance of over 40,000, whereas a game in the first division of the women’s Bundesliga attracted around 2,800.
The different degrees in popularity are a key contributing factor for the unequal pay, which may be regarded as potential indirect sex discrimination. There is no suggestion of direct sex discrimination arising in this instance.
However, to minimise the risk of unlawful indirect sex discrimination, any potential indirect discrimination requires justification, albeit with less stringent criteria than direct discrimination. The indirect discrimination may be justified by objective factors that are not based on sex. In particular, criteria based on the labour market, work performance or work results could potentially justify a difference in pay.
The profitability of the competitions, which is directly linked to their popularity, ought to be compelling as a justification for gender pay gaps. The clubs and associations have a justifiable, economic interest in paying a higher fee to players who generate higher revenues.
According to the 2021/22 season report, the first division of the men’s Bundesliga generated total revenues of 3.47 billion Euro, whereas the first division of the women’s Bundesliga generated only 17 million Euro. This difference in revenue is the result of different levels of popularity and would appear to be the basis of the pay gap between male and female players mentioned above.
Comparing the proportion of salaries and revenue generated by women in the first division of the Bundesliga with the salaries and revenue of the male players, there is no evidence of sex discrimination. The basic principle of proportionality appears to have been respected.
The link to profitability is not unusual in football, as, for example, there is also a drastic difference in salaries between the (male) first division players at FC Bayern München and the (male) first division players at 1. FC Köln.
In conclusion, there is no direct sex discrimination in respect of pay, because the payment of a lower salary is not directly linked to the sex of the players, but rather to the popularity of the competitions. The difference in pay, which could arguably constitute indirect discrimination, appears to be justified by the difference in profitability of the competitions.
What does this mean for the future?
German employment laws apply to professional German footballers too. As controversial as it may seem, the apparent indirect sex discrimination resulting from gender pay gaps in football may be objectively justified by the difference in popularity of men’s and women’s football matches and differences in the profitability of their football competitions.
However, that may not be the end of the story. Arguably there are broader, systemic issues at play, because of gendered social and cultural norms, which have resulted in lower investment in women’s sports, more infrequent televising of women’s events and less access to sports sponsorship, all of which impact the ultimate profitability of women’s football. It is worth noting that the US women’s soccer team brought an equal pay claim against the US Soccer Federation and were awarded significant sums in 2022 to settle their six-year legal battle.
Companies should heed the public attention accorded to gender pay gaps in the media. All employers have a duty to provide equal pay for equal work or work of equal value. It will not be possible to invoke different levels of profitability as justifications for pay differences in every sector and industry. Considering the public interest in the issue and the EU Pay Transparency Directive ((EU) 2023/970) adopted in June 2023, which is to be transposed into national law by 6 June 2026, there is an increasing need to keep gender pay gaps under review.
Furthermore, as different sectors and industries seek to identify and address their gender pay gaps to promote diverse and inclusive workforces in line with evolving investor expectations and wider societal views, there may be more focus on the sporting world to follow suit, as social arguments of morality, equity and fairness come in to play.Sign up to SportingLinks for more dedicated legal opinion on topical issues in the sports sector.
For further information, please contact:
Matthew Devey, Partner, Linklaters
matthew.devey@linklaters.com
