Equal Pay Is Down but Not Out

People at a Table

Last week, Senate Democrats found themselves seven votes short in their most recent effort to pass the Paycheck Fairness Act (“PFA”)—an effort which began in 2005, when Hillary Clinton first introduced the bill. But the Democrats’ continuing effort to paint the issue of equal pay as one of employer bias likely is not over.

Democrats have vowed to continue their efforts to pass expansive equal pay legislation that will place more burdens on employers and increase pay litigation, despite the fact that there already are strong laws on the books (EPA and Title VII). Further, every analysis (e.g. see studies by the GAO and OECD) of the “pay gap” among men and women in the work force conclude that the major reasons for a pay difference are societal and cultural, not due to employer bias.

In an interesting turn of events, just one day before the vote on the PFA, Senate Republican Dean Heller introduced the “End Pay Discrimination Through Information Act.” This bill duplicates the anti-retaliation section of the PFA, which offers greater protection to women who ask their employers about salaries. These provisions offer what democratic proponents claimed was an important feature of their own bill. But it excludes some of the more controversial and burdensome PFA provisions, such as those that would enhance penalties against employers and would allow the government to monitor employer salary data. Democrats criticize the bill for watering down what they believe are important provisions of the PFA.

Employers would be well advised to monitor the legislative dynamics and the politics of equal pay in this volatile election year. Despite their huge differences, the equal pay proposals by each party underscore that both Republicans and Democrats want to be viewed as supportive of pay protections for women.

Meanwhile, in 2011, the EEOC commenced a Directed Investigation Pilot Program pursuant to the Equal Pay Act. The program is intended to reinvigorate the EEOC’s conduct of EPA audits which had been little used by the EEOC since it took over authority for EPA enforcement in 1978. EPA audits is one of the initiatives adopted by President Obama’s National Equal Pay Enforcement Task Force to address the legislative defeats and explore various means of enforcing equal pay standards. Rather than relying on individuals to file a claim, under the pilot program, three EEOC district offices have begun auditing employers to ensure compliance with Equal Pay Act standards. EEOC offices in Chicago, New York and Phoenix have conducted a small number of audits. These audits generally begin with a letter to the employer and a subsequent meeting to discuss the investigation. After the meeting, the EEOC develops a discovery strategy tailored to the specific employer. In April 2012, the Chicago district office reported completing six audits and stated that it had not experienced any resistance from employers. It also reported that the pilot program had not revealed any instances of systemic equal pay issues in the first six audits it had completed. The EEOC expects to expand the pilot program. Employers should be aware that such audits can be started by the Commission without any charge by an individual. The Commission might also decide to initiate a Directed Equal Pay Act investigation as a result of information it obtains in the course of investigating a charge of discrimination under Title VII or one of the other statutes enforced by EEOC. Employers, therefore, need to be careful about any pay information they provide to EEOC during any investigation.