16 Mar Developments in Gender Pay Equity Laws

1.95 million. As of the date of this post, that is the number of results produced by my general internet search for “pay equity issues.” There has indeed been much debate and literature on the issue, ranging from general analysis and wage gap statistics to comprehensive case studies and examinations of proposed and existing laws. My interest, naturally, is what the legal landscape looks like in this space and how best to navigate it.

Under federal law, both Title VII and the federal Equal Pay Act prohibit discrimination on the basis of sex in wages. Title VII provides more of a general proscription against sex-based discrimination (which would include paying women and men differently), and the Equal Pay Act bans employers from discriminating against employees on the basis of sex by paying employees of opposite sexes different rates of pay, except for when those differences are the result of a seniority system, a merit system, a production system or any other factor other than gender.

At the state level, the vast majority of states expressly make it unlawful to discriminate against a person in compensation on account of that person’s sex. In the couple of states that do not (Alabama and Mississippi), federal law applies. In most states, the proscription against sex-based discrimination in wages would appear general in nature, meaning that employers are simply prohibited from paying men and women different for the same job. What happens, though, if the work is arguably similar but the job title is different, as may be the case between janitors and housekeepers or maids, for example. What about a man and woman who technically have the same job but work at different locations, with (for the sake of argument) the man working at the more profitable location and thus receiving the higher wage?

To address these and other issues, more and more states are expanding the scope of what it means to discriminate in connection with compensation, and what employers can and cannot do in this space. In Massachusetts, for example, a new law set to go into effect in July of 2018 prohibits gender-based wage discrimination for “comparable work,” hence resolving the similar work but different job title conundrum. The Massachusetts law would also prohibit employers from requiring applicants to provide wage history prior to receiving an offer, according to a press release from the governor’s office.  In addition, and similar to the National Labor Relations Act, the Massachusetts law would allow employees the ability to freely discuss wages without fear of reprisal.

California’s new law (the California Fair Pay Act), enacted in 2016, and similarly expands protections for employees who perform “substantially similar work,” meaning that as long as the work in question is “substantially similar” an employee will have a cause of action if another of the opposite sex is paid more, regardless of title. Significantly, the new law amends the previous law (the California Equal Pay Act) by, for example, eliminating a requirement that employees being compared work at the “same establishment.” California also makes it against the law to retaliate against someone for discussing wages and extends its protections beyond gender/sex to gender identity and gender expression, which means that employees who do not identify and/or express themselves with the gender in which they were born are protected against discrimination in compensation. California employers are required to keep records of employee wages and wage rates for a period of three years.

Notably, in California, there appears to be no geographic limitation when comparing wages for comparable work in order to see whether the law has been followed. However, in New York and Maryland, where new, similar pay equity laws have been passed in 2016, the comparisons are limited to county.

Regardless of the jurisdiction, and as is often the case with many laws, there are exceptions to the rule. Many jurisdictions, for example, carve out exceptions for religious institutions, temporary or seasonal jobs, charitable organizations, educational institutions, social clubs, part-time vs. full-time employees, seniority systems, merit systems and so on. These laws are highly state specific and ever-so evolving. In addition to ensuring, of course, that both men and women receive comparable pay for comparable work, employers are best served by seeking legal counsel familiar with the law in its jurisdiction for guidance on the many general and nuanced issues that arise in this area of the law.

This article is a publication of MWH Law Group LLP and is intended to provide general information regarding legal issues and developments to our clients and other friends. It should not be construed as legal advice or a legal opinion on any specific facts or situations. For further information on your own situation, we encourage you to contact the author of the article or any other member of the firm.

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