COVID-19 has created severe and lasting consequences for businesses. One of the most overlooked ramifications of the pandemic may be its impact on working women. An analysis by the Wall Street Journal entitled Coronavirus Employment Shock Hits Women Harder Than Men reveals unsettling details about how women working in certain industries are more vulnerable to job losses than men. The article is available here (paywall).
In an article published in June 2020, Trusaic discussed how the current economic downturn is different from others in its gendered impact, particularly along the dimensions of 1) job loss and 2) distribution of household and childrearing responsibilities. According to the Wall Street Journal, in April, when the lockdown measures were taking effect across the country, unemployment rates among women rose to 16.2%, compared with 13.5% for men. For women of color, unemployment rates were higher: 16.4% among Black women aged 20 or older; for Latinx women it was 20.2%; for white women the unemployment rate was 15%.
The Wall Street Journal additionally highlighted how the economic impact of COVID-19 is different from other slowdowns in terms of which employees were impacted. Citing Stefania Albanesi, a professor of economics at the University of Pittsburgh, the Journal noted that women made up 77% of jobs that cannot easily implement social distancing, such as food preparation, health-care support and personal services. In previous slowdowns, men were more likely to be impacted because of higher representation industries where work dried up, such as in construction and manufacturing, according to the Journal.
Given these dire figures about women and job loss, employers may be wondering what to do, so as not to create or exacerbate gender-based inequities in their workforces. “While many businesses have had to lay off staff, the ‘new normal’ of our economy makes it unlikely that firms will be able to hire back to their prior positions all of the employees they have had to let go,” Dr. Mark Dwyer, Trusaic’s Vice President of Data Science, explains. “This means that for many businesses, the net impact of coronavirus will be a change in the labor needed to function profitably.”
This is where a pay equity audit is essential to approaching decisions such as layoffs, furloughs, and rehires. A pay equity audit is an analytical tool that seeks to explain internal differences in pay across the workforce in terms of justifiable business factors, as well as identify the areas where pay differences may not be defensible. It can also provide critical analytics to kickstart rehiring in compliance with state and federal equal pay laws. Experts across the human capital, legal services, and business intelligence industries recommend a pay equity as a means to avoid legal liabilities resulting from compensation decisions. Further, such decisions need not be deliberate in order to create legal issues. Under federal civil rights laws, the doctrine of “disparate impact” does not require employer intent in order to establish culpability. Sarah Smith Kuehel, Esq., explains this concept in an article in the National Law Review: “Under a court’s ‘disparate impact’ or ‘adverse impact’ analysis, a plaintiff can prevail in a lawsuit by establishing an employer’s policy or practice affects members of the protected group so disproportionately that the court can infer discrimination from that impact.”
Not sure where to begin a pay equity audit? Let Trusaic provide your organization with a free Pay Gap Analysis, which can be conducted confidentially and under the attorney-client privilege.
Here is what you will get:
1-hour consultation to our pay equity team comprised of regulatory compliance experts and data scientists