Overview: Under the Equal Pay Act (EPA) as well as state and local fair pay acts, men and women are required to receive equal pay for equal work. Generally, the jobs do not have to be identical, but need to be substantially equal in terms of skill, effort and job responsibility, and performed under similar working conditions. The term pay pertains to not just salary, but also overtime, bonuses, vacation and holiday pay, stock options, life insurance and all other benefits and compensation of any kind paid to employees. Employers can defend a claim of wage discrimination under a seniority system, merit system, a system measuring earnings by quality or quantity of production or if wages were set based on a factor other than sex. Employers also should know that Title VII further prohibits wage discrimination.
Trends: In 2009, the Lilly Ledbetter Fair Pay Act was signed into law. It provides that the time an individual has to file a wage discrimination lawsuit begins each time the individual receives a paycheck, therefore allowing aggrieved individuals more time in which to file a lawsuit. This law was passed was in response to the US Supreme Court ruling in Lilly Ledbetter v. Goodyear Tire, 550 U.S. 618 (2007) which held that the time an individual has to file an equal pay lawsuit begins on the date the employer made the initial discriminatory compensation decision, not the date of the most recent paycheck. Employers also need to understand that the Lilly Ledbetter Fair Pay Act does not just apply to wage discrimination cases based on sex, but also wage discrimination based on race, age, color, national origin, and religion under Title VII as well as age under the Age Discrimination in Employment Act and disability under the Americans with Disabilities Act.
Employers also should be aware that the Paycheck Fairness Act has been introduced in the US Congress, but has failed to advance. The proposed law would provide individuals with increased damages under the EPA and include potentially unlimited back pay and punitive damage awards. It would put the burden on the employer to prove that a disparity in wages was based on a bona fide factor other than sex such as education, training, or experience, and that the other factor is job-related and consistent with business necessity. It would also make it easier to bring a class action lawsuit under the EPA and prohibit retaliation against employees for filing a claim of wage discrimination
In 2014, President Obama signed two executive measures enforcing equal pay laws and combating wage discrimination for federal contractors. Specifically, an Executive Order prohibits federal contractors from firing or discriminating against employees or job applicants who have inquired about, discussed or disclosed their own or a coworker's compensation information. In a Presidential Memorandum - Advancing Pay Equality Through Compensation Data Collection - the Department of Labor (DOL) is directed to issue regulations by August 6, 2014 requiring federal contractors to submit information about the compensation paid to employees, including data by race and sex which will be used to encourage federal contractors to comply with equal pay laws and identify and analyze industry trends while focusing on federal contractors with pay discrepancies.
Additionally, the EEOC has identified enforcing equal pay laws as a priority in its Strategic Enforcement Plan.
Author: Beth P. Zoller, JD, Legal Editor
The Equal Employment Opportunity Commission (EEOC) has published a notice in the Federal Register regarding a proposed revision of the Employer Information Report (EEO-1), furthering the Obama Administration's plans to advance equal pay protections for all workers.
This podcast examines new laws expanding California's equal pay statute, restricting E-Verify use and a flurry of minimum wage increases that are sure to impact employers in 2016. Anthony Oncidi, who heads the labor and employment practice group at Proskauer Rose's Los Angeles office, discusses the most significant developments.
To guide employers on following the requirements of California's Fair Pay Act, XpertHR's content has been enhanced with How to Comply With California's Fair Pay Act.
This How To details the steps an employer should take to comply with California's Fair Pay Act.
A number of new laws passed as part of the Women's Equality Act will take effect in New York in 2016.
Governor Andrew M. Cuomo has signed a number of bills that expand current protections regarding employment discrimination and pay equity and has issued regulations addressing gender identity discrimination protections.
California recently enacted the California Fair Pay Act, making significant amendments to California's equal pay law.
California Governor Jerry Brown has signed into law significant changes to the state's equal pay statute, leading him to call it, "The strongest equal pay law in the nation." Equally notable was Brown's veto of a bill that would have outlawed the use of mandatory arbitration agreements as a condition of employment.
HR Guidance on developing policies and practices to eliminate pay discrimination.