Equal Pay Still a Hot Issue: Fair Pay Act Reintroduced in Congress

Author: Beth P. Zoller, XpertHR Legal Editor

In a year in which equal pay looks to be hot issue, the Fair Pay Act (S. 168, H.R. 438) was reintroduced in Congress in both the House and the Senate by Rep. Eleanor Holmes Norton (D-DC) and Senator Tom Harkin (D-IA) respectively.

The Fair Pay Act would amend the Fair Labor Standards Act (FLSA) and provide for equal pay for comparable or equivalent work. Equivalent work means that the jobs might not be similar in terms of duties, but are equal in terms of skills, effort, responsibility and working conditions. According to Senator Harkin,

The Fair Pay Act attempts to address the more systematic forms of discrimination and the historic pattern of undervaluing and underpaying so-called "women's" work. Millions of women have jobs - for example, social workers, teachers, child care workers and nurses - that are equivalent in skills, effort, responsibility and working conditions to jobs that are usually held by men. However, the jobs that are predominantly held by women pay significantly less.

The bill would prohibit employers from discriminating against employees based not only on sex, but also race and national origin. It would prohibit employers from reducing the wages of other employees to achieve pay equity. It also would require employers to publicly disclose employer job categories and pay scales but not specific information on individual employees.

Employers are provided with some measure of protection as the proposed law would permit them to pay different wages under a system based on seniority, merit or production. The legislation also would permit employers to pay different wages if the difference is based on a bona fide factor other than sex such as education, training or experience. To show that a factor is bona fide, an employer must establish that the factor is job-related, furthers a legitimate business purposes and that there are no less discrimatory alternatives to achieve the same business purpose.

Under the proposed law, employees alleging violations may obtain compensatory and punitive damages.

The legislation has been referred to the House Committee on Education and the Workforce and the Senate Committee on Health, Education, Labor and Pensions.

Equal Pay Target of President, EEOC and Congress

Versions of the Fair Pay Act have been introduced in every legislative session going back to the 103rd Congress in 1994, but none of them ever made it out of committee. The latest legislation also is a long shot, given that the balance of power on Capitol Hill did not change significantly in the 2012 election. Nevertheless, it arrives in a climate of renewed focus on pay disparities, following a declaration by the Equal Employment Opportunity Commission (EEOC) in its Strategic Enforcement Plan to "target disparate pay" for vulnerable workers and "compensation systems and practices that discriminate based on gender" as well as a promise by President Barack Obama in his inaugural address to make sure that "our mothers and daughters can earn a living equal to their efforts". Further, the Paycheck Fairness Act, a similar measure to end wage discrimination against women, was recently reintroduced in Congress and also builds on the Equal Pay Act of 1963 and the Lilly Ledbetter Fair Pay Act, which also promote pay equity.

Regardless of whether the Fair Pay Act is enacted this time around, prudent employers should avoid wage differentials based on sex, race, national origin or any other protected class unless they can be justified by a legitimate and nondiscriminatory reasons.

XpertHR will continue to monitor the proposed Fair Pay Act and report on its progress.