Pay equity, diversity and inclusion
Equal Pay Laws Creating Patchwork of Regulatory Requirements
The push for equal pay is becoming a global initiative. It could be argued that the U.S. is playing catch-up both on the global stage and at home, where states and cities are moving assertively to address the equal pay issue.
As with any issue where state and local governments start taking the initiative, as opposed to the federal government, a patchwork of regulatory requirements and penalties begins to develop, challenging employers with facilities in multiple states to keep abreast of the latest initiatives. Keeping current with these new laws and regulations is critical, as they could result significant financial penalties.
Here is a look at some of the notable state-level equal pay laws currently in place in the U.S. that provides an example of this regulatory patchwork:
California ’s Fair Pay Act prohibits compensation discrimination on the basis of gender, race, or ethnicity for employees performing “substantially similar work…when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions.” Employees have both administrative and judicial recourse for violations. For administrative remedies (achieved via filing a claim with the Labor Commissioner), an employee can recover the difference in wages, interest, and an equal amount as liquidated damages. If an employee files a case in court, he or she can also recover attorney’s fees and costs.
The Diane B. Allen Equal Pay Act in New Jersey makes it illegal for employers to pay women or members of any of the other 15 protected classes listed under the Law Against Discrimination less than anyone performing substantially similar work who does not belong to that protected class. Failing to comply could result in an award of up to six years in back wages, plus triple damages for the prevailing plaintiff in a lawsuit.
In Massachusetts, employers are prohibited from discriminating in rates of pay on the basis of sex amongst employees performing “for work of like or comparable character or work on like or comparable operations.” Under the Massachusetts Equal Pay Act, an employer in violation may be liable for: (1) the amount of the affected employee’s unpaid wages (i.e., the amount by which he or she was underpaid); (2) plus an equal amount of unpaid wages (i.e., double damages); and (3) the affected employee’s reasonable attorneys’ fees and other costs if he or she is awarded any judgment in his or her favor.
These are only some of the laws and penalties that have been passed or enacted across the country by state, regional and local governments in the last few years.
Employers should become familiar with equal pay statutes and regulations to understand how they could impact their organizations. They also should consider undertaking a pay equity audit to find out where their organization stands in providing equal pay to employees. The equal pay movement in the U.S. is only going to grow. If you have not already started, it’s time to get ready to address equal pay in your organization.
To learn more about achieving pay equity, click here.