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Equal Pay Act

IPMA Passed a resolution at the 1999 International Training Conference

Congress is currently considering proposals to "strengthen" the Equal Pay Act provisions. In 1963, the Equal Pay Act (EPA) was passed as an amendment to the Fair Labor Standards Act (FLSA). In general, the EPA requires men and women to be paid equal wages for equal work. President Clinton's announcement during the State of the Union address that equal pay laws must be strengthened received applause from both Democrats and Republicans. Bills are currently pending to amend the Equal Pay Act, (H.R. 541, S. 74), titled the "Paycheck Fairness Act." The Democrats have also included reforms in their priority legislation, S. 8.

Supporters of the bills argue that this legislation will help to eliminate the pay-gap that currently exists between men and women. Recent studies indicate that women earn 74 cents for every dollar earned by men. Although the pay-gap should be eliminated, there is some concern that these bills will not be effective. In brief, the Paycheck Fairness Act would:

  • Allow for unlimited punitive and compensatory damages for violations of the EPA. Current damages include back-pay or double-back pay for willful violations. Also, states are exempt from punitive damages under Title VII of the Civil Rights Act of 1964, but the bills do not provide for a similar exemption for violations of the EPA.
  • Prohibit employers from punishing employees who publicly disclose confidential salary information.
  • Direct the Department of Labor to develop "comparable worth" guidelines that would be published in the Federal Register.
  • Authorize the Secretary of Labor to conduct outreach, studies, and research to eliminate pay disparities between men and women.
  • Provide funds for special training for enforcement personnel at the Equal Employment Opportunity Commission (EEOC) and the Department of Labor's Office of Federal Contract Compliance Programs to investigate allegations of pay discrimination.
  • Make it easier to bring class-action law suits.

One concern for employers is that the Paycheck Fairness Act would allow unlimited punitive and compensatory damages. Wage discrimination on the basis of gender is already illegal under Title VII of the Civil Rights Act of 1964. When Congress passed the Civil Rights Act Amendments of 1991(amending Title VII), providing for punitive and compensatory damages, they put caps on the amount of damages that could be awarded. Damages under Title VII are limited to $50,000-$300,000 depending on the size of the employer. Congress also exempted state and local governments from the punitive damages provision. Plus, the amendments would allow employees direct access to the courts. Title VII requires employees to go through administrative procedures with the EEOC before bringing a case to court. Some of the problems associated with these changes include an overloaded court system. Lawrence Lorber, a prominent labor and employment law attorney with the law firm, Sonnenschein, Nath & Rosenthal, points out that since 1991, 25% of all cases in the federal courts are employment or civil rights cases. The Courts of Appeals are so overcrowded, says Lorber, that they often do not have time to write opinions but instead publish one-line decisions.

Another concern is the requirement that the Secretary of Labor develop comparable worth guidelines. Section 6 of the Paycheck Fairness Act directs the Secretary of Labor to develop guidelines that would enable employers to voluntarily evaluate jobs based on "objective criteria." The Senate Bill lists some of the criteria: educational requirements, skill requirements, independence, working conditions, and responsibility including decision-making responsibility or supervisory responsibility. (Significantly, the impact of the market on determining wages and employer priorities are not included among the list of criteria.) Although the bill refers to these as "objective criteria" it will be difficult to measure factors such as "independence" or "responsibility." This is an attempt to reintroduce the concept of comparable worth. Lorber points out that the federal courts rejected this concept in the 1970's and 80's.

Representative Bill Goodling (R-PA), chair of the House Education and Workforce Committee, wrote an article for Roll Call Magazine that was published February 15, 1999. In that article, he offers another solution to the pay-gap problem. First, allow compensatory time in private sector so that employees have more flexibility to balance work and family. Second, support the EEOC in its efforts to enforce the laws that are already in place to prevent discrimination against women.

Not only is pay equity legislation being considered at the federal level, but the AFL-CIO announced a campaign to push for enhanced pay equity laws in 22 states on February 24, 1999. Although the legislation would vary by state, the AFL-CIO is supporting model legislation that would prohibit pay differentials in jobs that are "equal" within the meaning of the federal Equal Pay Act. The model legislation would also prohibit paying "wages to employees in a job that is dominated by employees of a particular sex, race or national origin at a rate less than the rate at which such employer pays employees in another job that is dominated by employees of the opposite sex or of a different race or national origin, for work on equivalent jobs." It would be up to the particular state to determine whether a job is dominated by employees of a "particular sex, race, or national origin." The 22 states are: Alabama, Delaware, Florida, Georgia, Hawaii, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Massachusetts, Michigan, Missouri, Nevada, New York, Ohio, Oklahoma, Pennsylvania, Rhode Island (funding), South Carolina, Texas, West Virginia (study), and Wisconsin.

IPMA strongly supports the principles of pay equity and supports legislation to address the wage-gap. However, these bills, as currently written, raise a number of issues.

Equal Pay Act Resolution
WHEREAS: The International Personnel Management Association has a policy of strong leadership in the review and development of legislation affecting public jurisdictions; and

WHEREAS: The International Personnel Management Association is committed to championing and representing the needs of its members at all levels of government; and

WHEREAS: Proposals from both the House and Senate to revise the Equal Pay Act are being considered; and

WHEREAS: Among these proposals is a proposal to permit unlimited punitive and compensatory damages to be awarded; and

WHEREAS: Unlimited compensatory and punitive damages would constitute an unfunded mandate; and

WHEREAS: Legislation in these areas could have a negative impact on existing employment and compensation systems, now therefore, be it

RESOLVED: That the International Personnel Management Association affirms its support for the purpose and concept of the Equal Pay Act; and be it further

RESOLVED: That the International Personnel Management Association opposes the imposition of unlimited punitive and compensatory damages and directs a copy of this resolution to all appropriate parties.