Frequently Asked Questions about Pay Equity
What is pay equity?
Pay equity refers to the elimination of sex and race discrimination in the setting of wages: it means fair pay for work. Pay equity encompasses:
· Equal pay for equal or the same work where identical jobs are compared;
· Equal pay for work of an equal value or comparable worth for jobs that are not identical but are of an equal value, for example, a nurse and a carpenter;
· Strategies that address women‘s low pay and promote a living wage;
· Ending discrimination in pay scales and systems.
What is the gender wage gap?
The gender wage gap is the difference between women‘s and men‘s wages, usually expressed as a percentage difference. Currently, women‘s annual earnings are 78 percent of men‘s annual earnings.22
Isn’t the wage gap beginning to close?
While the wage gap has begun to narrow – women were only earning 59 percent of men‘s earning when the Equal Pay Act was passed in 196223 – women continue to face a wage gap at every educational level. Women‘s achievements in higher education are partly responsible for narrowing the wage gap in the last several decades and there are more women earning college and professional degrees. Unfortunately, the narrowing of the gap is also partly caused by a decline in the real value of the wages of men without college degrees.24
Wasn’t there already a law passed about giving women equal pay?
Legislative actions have been taken by states and the federal government to address pay inequity. In 1962, the Equal Pay Act amended the Fair Labor Standards Act of 1938 making it illegal to pay men and women different wages for jobs requiring the same level of skill, effort, and responsibility, performed under similar working conditions within the same establishment.25 The jobs do not need to be identical, but must be substantially equal. It is job content, not titles, that determines whether jobs are substantially equal.26 This amendment helped to usher in the concept that, legally, women should be paid the same for the same work. Title VII of the Civil Rights Act of 1964 prohibits discrimination in compensation because of race, color, religion, national origin, and/or sex.
Why do we need additional legislation?
The Equal Pay Act and Title VII of the Civil Rights Act are important laws, but can be hard to enforce, and legal cases are difficult to prove and win. Because enforcement of the laws is complaint driven and most of the information needed to prove a complaint is held by employers, these laws lack the ability to eliminate discriminatory pay practices.27
What is “comparable worth”? Comparable worth can be defined as shorthand for "equal pay for work of equal value." Whereas the Equal Pay Act required equal pay when men and women were doing substantially the same work, it does not impact women who make less than men for comparable work. Many of the jobs traditionally done by women have been systematically undervalued in the marketplace. The result is that jobs disproportionately held by women are paid less than comparable jobs with the same levels of skills and responsibilities that are commonly held by men.
Researcher Lois Haignere provides an example showing a substantial proportion of school districts in the U.S. pay secretaries and teaching assistants less than the cleaners. In Denver, nurses were found to make less than gardeners. In New York State, school nurses in the West Islip school district start at $27,000, groundsmen at $29,000.28
Don’t women make less because they spend more time out of the workplace due to care giving responsibilities and choices?
There are theories which essentially state that women find themselves in a situation of pay inequity because of the choices they made – decisions to put their family first, manifested as taking time out of the labor force or reducing hours at various times to care for children or other family members – rather than because the system itself is biased.29 The labor force that is one year out of college should be the least likely to show a gender pay gap, as both male and female graduates are not likely to have children yet, so parenthood is a less important factor than it will be later in their careers, however, Behind the Pay Gap found a significant pay gap nonetheless. Female graduates working full time earn 80 percent of what their male counterparts earn and among part-time workers the gap is larger, with women earning 73 percent of what their male colleagues’ earn.30
What about differences in skills and education between men and women?
With the remarkable educational gains by women during the past 40 years, there should be no dispute that women have the credentials for higher paying jobs. Today women make up a majority of college students. Overall, men are only slightly more likely to have a college degree, and among young adults, these differences disappear altogether. Women have made considerable advancements in the fields traditionally considered male. The most dramatic changes occurred in professional programs such as medicine, law, and business, where the proportion of women shot up from nine percent in 1970 to 47 percent in 2000. Some economists, however, argue that women have the ‗wrong‘ educational credentials and skills and say that women are not sufficiently well educated in mathematics and science.31 During the past three decades, women have made significant gains in nontraditional fields including biology, physical sciences, business, and mathematics. For example, women now earn more than 60 percent of undergraduate degrees in biology and nearly half (47 percent) of undergraduate degrees in mathematics.32
Women‘s progress in professional programs such as medicine, business, and law has been remarkable. In 1970, only nine percent of students in professional degree programs were women; by 2001, women made up 48 percent of this student body.33
Working in a nontraditional field has long been suggested as a way for women to increase their pay. A significant gender wage gap is found among doctors, lawyers, and businessmen. For example, a study of University of Michigan Law School graduates found that even after controlling for child care, work history, school performance, and other variables, about one fourth of the male-female pay gap remained unexplained.34
Don’t women choose careers that pay less but have schedules that provide a greater balance between work and family?35
Occupational segregation is often cited as a reason for pay disparities between men and women. Economists Boraas and Rodgers found that the share of women in an occupation is the largest contributor to the gender wage gap.36 Despite women‘s progress in many nontraditional jobs, occupational segregation remains widespread. An analysis by the National Women‘s Law Center found that more than half of women (or men) would have to change jobs to completely eradicate occupational segregation.37 Regrettably, it is women who make up the majority of what have come to be known as ―pink collar‖ jobs. Many of the occupations most heavily dominated by women include the lowest paid workers.
Wouldn’t pay equity cause wages to move to the lowest common denominator and cause everyone to be paid less? Pay equity would not lead to a reduction in men‘s wages. Federal law prohibits reducing pay for any employee to remedy discrimination. Rather pay equity would mean equal treatment for all workers.
Wouldn’t increasing wages hurt employers?
Evidence across the world shows that neither increases in women‘s wages as a result of pay equity efforts do not cost employers too much, nor does implementing pay equity unnecessarily disrupt the economy.38 In fact, forward-looking employers recognize that eliminating pay differentials makes good business sense and that pay equity can help with competitiveness, worker retention, and productivity.
Equal pay would not bust the budgets of businesses or governments. Wage adjustments tend to be modest and are phased in over a period of years. In Minnesota, where equal pay legislation was implemented for public sector employees over a four-year period, the cost was only 3.7 percent of the state‘s payroll budget. In the state of Washington, equal pay for state employees, implemented over an eight-year period, cost only 2.6 percent of overall personnel expenditures.39
22 U.S. Census Bureau, U.S. Bureau of Labor Statistics. Annual Demographic Survey. August 2008. http://www.census.gov/prod/2008pubs/acs-09.pdf Accessed Nov. 25, 2008.
23 Institute for Women‘s Policy Research. (November 2003). The Gender Wage Gap: Progress of the 1980’s Fails to Carry Through. November 2003. http://www.iwpr.org/pdf/C353.pdf Accessed Feb. 17, 2007.
24 AAUW Educational Foundation. Public Perceptions of the Pay Gap. 2005. http://www.aauw.org/research/perceptions_paygap.cfm Accessed Dec. 20, 2006.
25 Equal Pay Act, 29 U.S.C. §206.
26 U.S. Equal Employment Opportunity Commission. Facts About Compensation Discrimination. 2002. http://www.eeoc.gov/facts/fs-epa.html Accessed Feb. 15, 2007.
27 National Committee on Pay Equity. Questions and Answers on Pay Equity. http://www.pay-equity.org/info-Q&A.html Accessed Feb. 22, 2007.
28 Haignere Inc. What is Pay Equity/Comparable Worth? http://www.payequityresearch.com/worth.htm Accessed Feb. 15, 2007. 29 U.S. General Accounting Office. Women’s Earnings: Work Patterns Partially Explain Difference between Men’s and Women’s Earnings. Report GAO-04-35, 2003. http://www.gao.gov/new.items/d0435.pdf Accessed Feb. 16, 2007.
30 AAUW Educational Foundation. Behind the Pay Gap. 2007. http://www.aauw.org/research/behindPayGap.cfm Accessed June 11, 2007.
31 AAUW Educational Foundation. Public Perceptions of the Pay Gap. http://www.aauw.org/research/paygapperceptions_April05.pdf Accessed Feb. 22, 2007.
32 AAUW Educational Foundation. Gains in Learning Gaps in Earning. 2005. http://www.aauw.org/research/statedata/index.cfm Accessed Feb. 14, 2006.
33 AAUW Educational Foundation. Gains in Learning Gaps in Earning. 2005. http://www.aauw.org/research/statedata/index.cfm Accessed Feb. 14, 2006.
34 AAUW Educational Foundation. Public Perceptions of the Pay Gap. 2005. http://www.aauw.org/research/paygapperceptions_April05.pdf Accessed Feb. 14, 2007.
35 AAUW Educational Foundation. Public Perceptions of the Pay Gap. 2005. http://www.aauw.org/research/paygapperceptions_April05.pdf Accessed Feb. 14, 2007.
36 Wood, Robert G., Mary E. Corcoran, and Paul N. Courant. ―Pay differences among the highly paid: The male-female earnings gap in lawyers‘ salaries.‖ Journal of Labor Economics 11(3), 417_441. 1993.
37 National Women‘s Law Center. Sex Discrimination in the American Workplace: Still a Fact of Life. July 2000. http://www.nwlc.org/details.cfm?id=316§ion=employment Accessed Feb. 26, 2007.