Courts, States, and Employers Are Focusing on Pay Equity, Why is like that?

The federal Equal Pay Act went into effect in 1963, but it hasn’t brought an end to pay disparities between men and women. Neither have state laws with the same objective. Long story short: the laws weren’t strong enough, and they didn’t account for all the causes of unequal pay. In many cases, it has been possible for an employer to comply with these laws while still giving unequal pay for equal work.

Often, it’s not that employers have deliberately chosen to pay women less than men for the same jobs. In many cases, the basis for pay differentials has seemed sensible, such as salary history. But it turns out that basing pay on salary history perpetuates discrimination over an employee’s career. Mindful of these facts, some states across the country have instituted salary history bans and implemented other legal measures to strengthen pay equality. And the 9th Circuit Court of Appeals issued an opinion recently that significantly strengthened the federal Equal Pay Act.

In this article, we’re going to look at that ruling as well as some of the state legislative efforts. But, first, let’s review the federal Equal Pay Act, since that law affects all employers.

The Equal Pay Act

The Equal Pay Act makes it illegal for employers to pay unequal wages to men and women who perform jobs that require substantially equal skill, effort and responsibility, and that are performed under similar working conditions within the same establishment. Job duties, not job titles, will determine whether jobs are substantially equal. Each of the relevant factors are summarized below:

  • Skill is measured by factors such as the experience, ability, education, and training required to perform the job. The issue is what skills are required for the job, not what skills the individual employees may have. For example, two bookkeeping jobs would be considered equal even if one of the workers has a master's degree in physics, since that degree would not be required for the job.
  • Effort is the amount of physical or mental exertion needed to perform the job. For example, if employees are working side by side assembling machine parts, but the person at the end of the line must also lift the assembled product off the line, that job requires more effort than the other assembly line jobs. As a result, it would not be a violation to pay that person more, regardless of whether the job is held by a man or a woman.
  • Responsibility is the degree of accountability required in performing the job. For example, a salesperson who must decide whether to accept customers' personal checks has more responsibility than other salespeople. On the other hand, a minor difference in responsibility, such as turning out the lights at the end of the day, would not justify a pay differential.
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