In the discussion, we touched on a variety of topics including the proposed Paycheck Fairness Act, which did not get through a procedural vote last week.
As I’ve said on this blog before, there is no doubt that gender discrimination still exists in our society and must be eliminated. Indeed, there is also no debate that there is a median wage gap between men and women when looking at the raw statistics.
The issue we discussed today is: Why? Why do women tend to make less than men? Is gender discrimination the reason? (No, according to a recent U.S. Census study and a 2009 study commissioned by the United States Department of Labor.)
If persistent gender discrimination isn’t the reason (or the main reason) for the gender wage gap, then are new laws, like the Paycheck Fairness Act bill necessary or a solution?
(As readers will no doubt know, this blog has continued to taken an avidly apolitical stance focusing instead on what the impact on any proposed legislation might be on employers so I leave it to politicians to debate the merits of the actual bill.)
But the suggestion that we do not have laws on the books to protect equal pay for equal work is a false one. We already have an existing strict liability law on the books (the Equal Pay Act) that prohibits employers from treating men and women differently in the workplace except in limited circumstances. Here’s the key text:
No employer…shall discriminate… between employees on the basis of sex by paying wages to employees in such establishment at a rate less than the rate at which he pays wages to employees of the opposite sex in such establishment for equal work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions, except where such payment is made pursuant to (i) a seniority system; (ii) a merit system; (iii) a system which measures earnings by quantity or quality of production; or (iv) a differential based on any other factor other than sex…
Notably, a seniority system is one area where an employer IS allowed to treat employee differently. This most often occurs in a union environment where an employee who may be doing the same job as an employee 30 years younger will get paid more because of seniority. If the older employee is male and the newer employee is female, then that would explain a wage gap. Would unions go along with changing seniority systems to close the gender wage gap as well?
These are complicated and nuanced issues. Everyone agrees that the gender wage gap can’t be closed with legislation alone and its important to discuss the other factors that everyone agrees also leads to this wage gap: job choices, negotiations, time out of the workplace to raise a family, etc.
Here are a few resources if you’d like more background on the subject:
- The National Committee on Pay Equity prides itself on being the go-to organization working to eliminate sex- and race-based wage discrimination and to achieve pay equity.
- The Equal Pay Act of 1963 remains the key law in this area. You can read it here.
- The Ledbetter Fair Pay Act, passed in early 2009, can be found here.
- If you’d like more information about the Paycheck Fairness Act, you can view the testimony from the Senate hearing on the bill here. The testimony has some very interesting nuggets of information. For example, one economist who was in favor of the legislation talked about the reasons behind the wage gap:
Overall, nearly a third of the gender pay gap (27.4 percent) can be explained by differences in occupations, one-fifth (21.9 percent) can be explained by industry, and 10.5 percent can be explained by labor force experience.
This means that if women worked in the same jobs as men and had the same educational and experience levels, same propensity to be in a union, same racial and ethnic make-up as men—all factors we can measure—the gender pay ratio would rise from 80 percent to 91 percent of men’s pay levels. In other words, most of gender pay inequity can be explained by these factors.
Hopefully, today’s show can continue to elevate the discussion of the gender wage gap into one of substance, rather than one where people are either "for" or "against" equal pay. I thank John Dankosky for inviting me to appear.