Wage Transparency: Legal Obligation, Reputational Risk, and Governance Opportunity

In 2023, with the enactment of Law No. 14,611, the legislator sought to transform wage equality between men and women from an existing formal guarantee into an effectively enforceable duty, backed by transparency, monitoring, and sanction mechanisms.

Although wage equality was already provided for in the Federal Constitution and the Consolidation of Labor Laws (CLT), the problem persisted in practice: women continued to earn less than men, not only in equivalent roles but also in positions of greater responsibility.

Having entered into force in July 2023, the law became part of the corporate governance agenda and remains active for private legal entities with 100 or more employees. These companies are required to adopt measures to ensure such equality, complying with the salary transparency mechanisms and remuneration criteria provided by law.

The topic remains highly relevant as the reports required by law can reveal internal asymmetries and expose weaknesses in internal policies regarding job positions, salaries, promotions, bonuses, and variable compensation criteria. This creates room for questioning not only by employees but also by labor unions, investors, clients, and other stakeholders.

Who is obligated?

The legislation applies to private companies with 100 or more employees, including those with headquarters, branches, or representation in Brazil. These companies must provide supplementary information on the Portal Emprega Brasil and publish the Wage Transparency Report on their institutional channels, ensuring easy access and wide visibility for both the public and the workforce.

The report is compiled based on information declared in eSocial, cross-referenced with data from CAGED, CNIS, and RAIS, in addition to information provided by the companies themselves. Its content features salary comparisons between genders in equivalent positions, as well as actions taken to promote equity. In other words, it is a statistical snapshot capable of revealing remuneration patterns and eventual inequalities.

How to interpret the report?

In practice, the report should be read as a starting point for an internal compensation audit and a potential review of internal policies.

Wage discrepancies can stem from legitimate factors, such as seniority, tenure, location, role complexity, performance, targets, statutory bonuses, variable compensation, or distinct job classifications. However, for these factors to be legally defensible, they must be documented, structured, and consistently applied.

Therefore, instead of asking whether a wage gap exists, the most appropriate question is whether the company can explain, document, and justify its remuneration criteria in an objective, non-discriminatory manner that is coherent with its internal policy.

This represents another dimension of corporate governance, which now encompasses employee compensation data—not only to identify potential deviations but also to promote their correction.

What can trigger fines or public exposure?

Failure to comply with the obligation to provide information through the semi-annual reports can expose the company to administrative fines or challenges from employees, labor unions, clients, and suppliers. In this context, common triggers for infractions include:

• Failure to provide the required information within the legally prescribed periodicity;

• Failure to publish the report on institutional channels;

• Disclosing information improperly, without respecting personal data protection regulations;

• Failure to draft an action plan when a disparity is identified by the Ministry of Labor and Employment (MTE);

• Maintaining remuneration gaps without objective and justifiable criteria aligned with the company’s structure;

• Adopting promotion, bonus, or salary classification policies without traceability;

• Treating the matter solely as an HR requirement, without the involvement of legal, compliance, and senior management.

Non-compliance with transparency obligations can result in administrative fines, without prejudice to other labor liabilities. Furthermore, if wage discrimination is identified, the company may face individual and collective lawsuits, audits, union negotiations, and severe reputational damage.

Action Plan: Obligation and Governance Tool

When the MTE identifies wage disparities or unequal remuneration criteria between women and men, the company may be notified to develop and implement an Action Plan for the Mitigation of Wage Inequality.

The plan must include a diagnosis, goals, deadlines, corrective measures, and programs related to diversity, training, and the entry, retention, and professional advancement of women in the labor market.

In practice, a consistent plan should include:

• Review of job and salary structures and policies;

• Objective criteria for promotions and career progression;

• Analysis of variable compensation, bonuses, and benefits;

• Review of hiring and internal mobility policies;

• Secure channels for whistleblowing/reporting;

• Leadership training;

• Documentation of remuneration decisions;

• Periodic monitoring by HR, legal, compliance, and the executive board.

How to prevent the issue from turning into an internal or external crisis?

The most significant risk lies not just in the fine itself, but in the combination of public data, the perception of internal inequality, and the absence of a technical narrative from the company.

If the report points to inequality and the company lacks clear criteria to explain its compensation structure, the issue can rapidly escalate from a regulatory matter to a labor, union, reputational, or institutional crisis. Therefore, preparation must begin well before the report is published.

Consequently, companies must view the review of their remuneration structures as part of their governance agenda, involving senior leadership to organize documentation, align internal communications, and prepare institutional responses.

Companies that can demonstrate objective criteria, consistent policies, and a real commitment to equity will be in a better position to mitigate risks, strengthen their internal culture, and confidently respond to inquiries from employees, regulatory bodies, and society at large.

In a scenario of active enforcement and growing public exposure, wage equality must be treated as a strategic issue: labor-related, reputational, regulatory, and a matter of corporate governance.

Cammarota & Abreu Advogados is available to assist its clients in assessing labor, regulatory, and reputational risks associated with wage transparency, as well as in structuring remuneration policies, action plans, and governance measures aimed at full compliance with Law No. 14,611/2023 and its regulations.