Equal Pay For Equal Work (2024)


Equal Pay For Equal Work (1)

Equal pay for equal work has long been a hot-button topic, prompting various states to enact legislation aimed at closing gender-based wage gaps. One notable example is the Equal Pay for Equal Work Act in Colorado, which represents a significant step towards addressing pay disparities by prohibiting employers from paying different wages to employees on the basis of sex (or gender identity), along with other protected categories.

Enacted in 2021, the Colorado Equal Pay for Equal Work Act (“Act”) builds on the foundational principles of the federal Equal Pay Act of 1963 by requiring employers to openly disclose compensation ranges and promotional opportunities to both current employees and prospective hires.

This transparency mandate aims to foster accountability and equity in compensation practices across diverse industries. The act likewise prohibits employers from inquiring about a candidate’s prior compensation history under the theory that use of this information perpetuates below-market compensation for women and minorities. Additionally, the Act prohibits employers from retaliating against employees who discuss or inquire about wage differentials, thereby promoting an environment that allows open dialogue and discourages discriminatory practices.

Does the act work? According to a recent Women’s Foundation of Colorado article, since implementation, Colorado has reduced its gender wage gap more than three times faster than the rest of the U.S. since 2021. [1] Specifically, pay for women working full-time in Colorado increased from 78 cents to 85 cents for every dollar paid to similarly qualified men. This progress boosted Colorado’s pay equity ranking from the 21st smallest gender wage gap to the 6th smallest gender wage gap in the U.S., and results in full-time working women earning an average of an additional $2,952 per year.

Similar legislative measures have been either enacted or proposed in other states across the country. For instance, California has long been at the forefront of equal pay legislation, implementing the California Equal Pay Act that not only prohibits an employer from paying its employees less than employees of the opposite sex for substantially similar work, but also imposes stringent reporting requirements on employers to disclose pay differentials based on gender, race, and ethnicity. [2]

Since implementing pay transparency, which requires employers to disclose pay ranges and provide pay scale information to employees, California has reduced its gender pay gap by three cents. [3] Washington, which also instituted pay and benefits transparency in 2023, has since reduced its wage gap by five cents. [4] Massachusetts [5] and Oregon [6], among others, have also adopted comprehensive equal pay laws that include provisions prohibiting salary history inquiries and enhancing transparency in pay practices.

Despite these state-level efforts, the question of whether there should be federal regulation to standardize and enforce equal pay laws nationwide remains a topic of debate. Proponents argue federal intervention is necessary to ensure consistency and provide a robust framework for combating wage discrimination across all states and territories. Some argue a federal approach could streamline compliance for multi-state employers and strengthen protections for workers who may fall through the gaps of varying state laws.

In furtherance of a federal approach, the Office of Personnel Management announced a new regulation and a proposed rule earlier this year to prohibit the use of salary history for federal employees and federal contractors. The Biden Administration has also asked Congress to pass the Paycheck Fairness Act in an effort to increase pay transparency and reduce pay discrimination based on sex.

On the other hand, opponents of federal regulation often cite concerns about government overreach, including over-regulation and burdensome reporting requirements, as well as the potential for one-size-fits-all policies that may not adequately or effectively address the unique economic and social dynamics of individual states and employees. Some suggest the Paycheck Fairness Act, if passed, would chill or end salary negotiations.

Critics also argue wage disparities are not necessarily the result of sex-based discrimination but instead the result of the decisions and priorities of individual workers. As such, the requirements of bills like the Paycheck Fairness Act could be an unnecessary burden on employers and could lead to increased litigation and bureaucracy. Instead, some argue states should retain autonomy to tailor their own laws to local employment conditions and preferences.

The issue of whether federal regulation is warranted also intersects with broader debate about the role of the government in labor relations and the effectiveness of existing federal anti-discrimination laws. Those in support of federal regulation point to ongoing wage differentials between men and women and the positive impact pay transparency laws have had in individual states, arguing that stronger enforcement mechanisms are needed at the federal level to hold employers accountable for discriminatory pay practices.

In conclusion, while states like Colorado and others have taken proactive steps to address pay disparities through legislation like the Equal Pay for Equal Work Act, whether federal regulation will follow remains unknown. Ultimately, the pursuit of equal pay will likely require a multifaceted approach that combines legislative action, enforcement measures, and societal shifts toward greater transparency and fairness in compensation practices.

Unless and until federal regulations are enacted to address the issue of equal pay, employers should strive to remain informed and in compliance with all necessary state and local laws, with the assistance of competent legal counsel.

Notes
[1] Women's Foundation of Colorado. (2024). Equal Pay Day News Release 2024. Retrieved from https://www.wfco.org/file/Equal-Pay-Day-News-Release-2024-updated.pdf
[2] California Equal Pay Act, Cal. Labor Code § 1197.5 (1949), amended by the California Fair Pay Act, S.B. 358, 2015.
[3] See note 1, supra.
[4] PayAnalytics. (2023, January 17). Washington pay transparency law requires employers to post pay ranges in job listings. Retrieved from https://www.payanalytics.com/resources/articles/new-pay-transparency-law-washington
[5] Massachusetts Act to Establish Pay Equity, Mass. Gen. Laws c. 149 § 105A.
[6] Oregon Equal Pay Act of 2017, Or. Rev. Stat. § 210, et seq.

Authors’ Bios

Equal Pay For Equal Work (2)Robert B. Hinckley Jr. is a Managing Shareholder at Buchalter.
Equal Pay For Equal Work (3)Sarah Andrzejczak is an Attorney at Buchalter.
Equal Pay For Equal Work (2024)

FAQs

What is an example of equal pay for equal work? ›

All forms of compensation are covered, including salary, overtime pay, bonuses, life insurance, vacation and holiday pay, cleaning or gasoline allowances, hotel accommodations, reimbursem*nt for travel expenses, and benefits.

What is equal pay for equal work quizlet? ›

An amendment to the Fair Labor Standards Act, this act requires equal pay for men and women doing equal work. It was the first modern employment discrimination statute. Plaintiff's pay rate was less than that paid to the employee of the opposite sex.

What is the equal pay for equal work responsibility? ›

The amended Equal Pay Act prohibits an employer from paying any of its employees wage rates that are less than what it pays employees of the opposite sex, or of another race, or of another ethnicity for substantially similar work, when viewed as a composite of skill, effort, and responsibility, and performed under ...

What is equal pay for work of equal value? ›

In essence, where comparable work is of equal value, employees rendering such comparable work should not be paid unequal pay where the differentiation between them is based on a prohibited ground of discrimination or on grounds that are found to be arbitrary.

Can two employees doing the same job be paid differently? ›

Federal and state laws, such as Title VII of 1964 (Title VII) and the Equal Pay Act (EPA), limit employers' abilities to pay employees differently for performing the same work.

How to prove pay discrimination? ›

If you believe that you have been the victim of pay discrimination, there are several steps you can take to prove it. By collecting data, comparing pay rates, checking for discrimination, documenting evidence, and filing a complaint, you can hold your employer accountable and seek justice for unfair compensation.

What is the equal pay for equal work? ›

Equal pay means that women and men have the right to receive equal remuneration for work of equal value. This means ensuring that women and men working in identical or similar jobs receive the same pay.

What is equal pay for equal pay? ›

The Equal Pay Act requires that men and women in the same workplace be given equal pay for equal work. The jobs need not be identical, but they must be substantially equal.

What does unequal pay for equal work mean? ›

The Equal Pay Act specifically prohibits paying men and women differently for the same work. All of these statutes are enforced by the U.S. Equal Employment Opportunity Commission (EEOC). Many states and cities have their own fair employment practices agencies that prohibit employment discrimination.

What are the benefits of equal pay? ›

Incentives: pay equity helps employees feel valued, and a valued employee is more motivated and productive. It also can create better office morale and a positive work environment. Retention: companies with strong pay equity policies tend to have less turnover.

What is an example of pay discrimination? ›

For example, pay discrimination may be occurring if male employees are offered higher starting salaries than female employees in the same job who have similar skills and qualifications, or if Hispanic employees are paid less than White employees even though their performance evaluations are similar, or if employees ...

Is equal pay justified? ›

Workers have a legal right to equal pay for 'like work'. This means that people who are doing the same or similar work, or work of the same value, must receive the same rate of pay. All contracts of employment are based on the unwritten principle that workers receive equal pay without discrimination.

What is an example of equal pay for work of equal value? ›

“Equal pay for work of equal value” is like comparing apples to oranges – They are different, but equally nutritious – for example: Comparing the value of a truck mechanic job class (commonly held by men) to that of an account technician job class (commonly held by women).

What are the effects of equal pay? ›

Equal pay for working women would increase their annual average earnings from $41,402 to $48,326, adding $541 billion in wage and salary income to the U.S. economy.

What is pay for equal value? ›

What equal pay means. As set out in the Equality Act 2010, men and women in the same employment performing equal work must receive equal pay, unless any difference in pay can be justified. It is the law and employers must follow it.

What is an example of a work of equal value? ›

Some jobs can be classed as equal work, even if the roles seem different. For example, a clerical job and a warehouse job might be classed as equal work.

What is the equal wages for equal work? ›

Equal pay means that women and men have the right to receive equal remuneration for work of equal value. This means ensuring that women and men working in identical or similar jobs receive the same pay.

What is equal pay for like work? ›

The term 'equal pay' includes all forms of remuneration, including wages or salary, and also other benefits such as bonuses, company cars or subsidised meals. It does not cover pensions. The right to equal pay for 'like work' is set out in the Employment Equality Acts 1998-2015 (EEA).

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