How can multinational employers navigate the divergent approaches to IE&D between the U.S. and Europe?

How can multinational employers navigate the divergent approaches to IE&D between the U.S. and Europe?

Employers in the U.S. have been responding to the new administration’s focus on what is described as unlawful discrimination related to IE&D, with many employers rethinking and even scaling back internal IE&D programs.

But the situation is different in Europe. In contrast to the U.S., employers here are under rising pressure from new laws and regulatory expectations to drive forward IE&D.

In the UK, a new obligation on employers to take steps to prevent sexual harassment came into force in October 2024, leading many employers to roll out action plans and enhanced training across their workforces.

In addition, new requirements to report on ethnicity and disability pay gaps (alongside the existing gender pay gap requirements) have just been consulted on by the UK government and are expected to come into force in 2026.

Employers are expected to be required to report on how their pay differs between their White British workforce and all other employees. In the EU, new gender quotas for women on boards in large-listed companies are about to bite, and a Pay Transparency Directive will impose onerous obligations on employers to disclose pay data and address gender disparities. Even within Europe, differences matter.

So, while ethnicity pay gap reporting will become mandatory in the UK, collecting ethnicity data is not permitted in France.

Many European IE&D -related requirements carry fines – sometimes even criminal ones – for non-compliance, meaning that a universal retreat from IE&D is not a realistic option.

Instead, what’s needed is a nuanced and local approach, ensuring that your company’s response reflects in-country requirements instead of a one-size-fits all approach.

Your Littler counsel is here to help you navigate these issues.