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Senate Committee Considers Equal Pay Legislation

On April 12, the Senate Health, Education, Labor and Pensions Committee held a hearing on equal pay for women. The hearing focused on the Equal Pay Act of 1963 (P.L. 88-38), the Fair Pay Act (S. 1087) and the Paycheck Fairness Act (S. 766).

Sen. Tom Harkin (D-IA), author of the Fair Pay Act, noted that even 40 years after the passage of the Equal Pay Act, women continue to earn 77 cents for every dollar earned by men. Sen. Harkin said, “We are supposed to be comforted by the fact that the wage gap is shrinking. But, according to the Economic Policy Institute, this is not because women are making more, it is because men are making less…There are various spurious reasons given that women make less than men, such as women self-selecting lower paid jobs or having less education. However, I believe that women are making less because we are not properly enforcing current law, and because we do not value jobs we traditionally view as ‘women’s jobs’ as we value those we think of as ‘men’s jobs. Why is a housekeeper worth less than a janitor, a parking meter reader worth less than an electrical meter reader, or a social worker less than a probation officer? Without question, we need to do a better job of enforcing the law that requires equal pay for equal work and we need to stiffen the penalties for violations. That’s why I support Senator Clinton’s Paycheck Fairness Act, which would help given women the tools they need to identify and confront discrimination head-on.”

“Since the passage of the Equal Pay Act and the discrimination provisions of Title VII [of the Civil Rights Act of 1964], we have witnessed enormous progress in ensuring both equality of opportunity and equity of compensation,” said Ranking Member Mike Enzi (R-WY). Sen. Enzi continued, “However, some maintain that these efforts are not sufficient and must be augmented, pointing to what some would call a wage gap that continues to exist in terms of compensation levels between men and women. Many labor specialists note that pay differentials are a function of labor market economics, and they reflect the choices that individual workers and groups of workers tend to make and the underlying skill sets of the workers.” Sen. Enzi stated, “I believe that the proper way to address this situation is to improve skills training and education. This is why I continue to urge the Democratic leadership to take up and pass the Workforce Investment Act to reauthorize the federal government’s job skills and training programs. In an economy where skills are critical to success, everyone should have access to education and training throughout their lives and the Workforce Investment Act is one way for people to gain the necessary knowledge and skills they need.”

Sen. Hillary Clinton (D-NY), author of the Paycheck Fairness Act, said, “A 2003 Government Accountability Office report found that women’s work patterns partially explain the differences between men’s and women’s earnings, but that even accounting for all other variables that are often used to justify the pay gap, such as time out of the work force to care for children or part time work, women still earn significantly less than men.” Sen. Clinton continued, “The report also concluded that 20 percent of the wage gap could not be explained by factors other than discrimination. Now, conventional wisdom often associates the pay wage gap with low-paying jobs, but this inequity is not limited to people who are in low paying jobs. Just recently, Wimbledon finally came around to pay the men and women champions the same amount of money. And we’ve had a series of studies done at some of our finest universities…finding that when you held constant for time in the work force, task on job, commitment to career…there were still discriminatory effects that, to their credit, some of these institutions have been willing to face and begin to try to address.”

Barbara Brown, an attorney at Paul, Hastings, Janofsky & Walker, LLP, said, “I am firmly and unequivocally committed to the eradication of compensation discrimination against women. S. 766 [the Paycheck Fairness Act] is not the way to do it. I believe that effective legal tools are in place to accomplish that goal and that S. 766 will impose substantial, costly burdens on employers that are unnecessary, unrealistic and indefensible. The provisions of Title VII of the Civil Rights Act of 1964…and of the Equal Pay Act of 1963 cover the area of compensation discrimination. I see no reason to change the underlying substantive law concerning compensation, as S. 766 would do in various mischievous ways.” Ms. Brown added that “S. 766 would eliminate the ‘establishment’ requirement that the employees being compared work in the same establishment or geographic market;” restrict legitimate distinctions employers make in determining wages and increase burdensome recordkeeping; “permit punitive damages in the absence of any finding of intentional discrimination”; and would alter “the class action [lawsuit] rules under the Equal Pay Act.”

Jocelyn Samuels, vice president for education and employment at the National Women’s Law Center, testified that “[t]he evidence shows that [wage] gaps cannot be dismissed simply as the result of women’s choices or qualifications. Indeed, substantial evidence demonstrates that discrimination and barriers that women face in the workforce must shoulder blame for wage disparities women endure.” Ms. Samuels stated, “First, the substantive standards of the [Equal Pay Act] both with regard to a plaintiff’s prima facie case and with regard to an employer’s affirmative defenses have been applied by courts in ways that make it difficult to demonstrate a violation of the law, even in cases where wage disparities are based on sex. Second, the remedies and procedures available to plaintiffs under the Equal Pay Act are insufficient to ensure the effective protection of this critical anti-discrimination law. Moreover, the law is simply inadequate to respond to wage disparities produced by the significant occupational sex segregation that still exists in numerous industries today. Finally, both because employers often fail to disclose and because the government refuses to collect information on pay disparities, it is exceedingly difficult for individuals or enforcement agencies to take effective enforcement action against discriminating businesses.”

“Inequitable treatment takes money out of a woman’s paycheck, which accumulates into serious financial losses over the 35 years that she typically works,” said Evelyn Murphy, president of the WAGE Project, Inc. Ms. Murphy continued, “Over the course of their working lives, a young woman graduating from high school this spring will make $700,000 less than the young man standing alongside her receiving his high school diploma. A young woman graduating from college this spring will lose $1.2 million compared to the man getting the same degree at the same time. A woman earning an MBA, law degree or medical degree will make $2 million less…Women do not realize the enormous price that they pay for gender wage discrimination because they do not see big bites taken out of their paychecks at any one time. Rather, little nicks in a woman’s paycheck a promotion delayed because she is pregnant and her boss guesses (wrongly) that she intends to shift to part-time work, a sales call she misses because her boss assumes she has gone home to cook dinner for her family, a request she makes for reassignment to escape a sexual harasser, leaving the bonus she earned behind all add up, over time, to become $700,000, $1.2 million, $2 million.”

Philip Cohen, associate professor of sociology at the University of North Carolina at Chapel Hill, said, “Improving pay equality between men and women can be an important impetus for equality in many areas, and for other social benefits for women, families and children, with far-reaching consequences.” Dr. Cohen gave examples of how wage discrimination affects the society-at-large: “Because of lower earnings for women, single mothers are twice as likely to live below the federal poverty line as single fathers (36 percent versus 18 percent). Thus, there are 3.5 million single mother families in poverty. Even among single parents who work full-time and year-round…single mothers are more than twice as likely to be in poverty as single fathers (12.1 percent versus 5.7 percent).” Dr. Cohen added, “Men are more likely than women to work in jobs that provide pensions upon retirement, but even among men and women who do receive pensions or Social Security, accumulated earnings differences lead to large gender gaps in pension amounts. This issue is of growing importance as the number of retirees and the costs of public retirement support increase…If government policy can help rekindle the movement toward gender equality, then the prospects for a more equal society will be greatly enhanced.”

Sen. Clinton asked the panel how Minnesota had been able to implement successful pay equity policies that have allowed female public employees to earn 97 cents for every dollar male public employees earn. Ms. Murphy responded that Minnesota solved the problem of occupational segregation by reevaluating, ranking, and comparing jobs and then paying public employees based upon the job instead of upon who performs the job. Ms. Murphy added that this model could be used to address other forms of wage discrimination, such as race or disability.

Sen. Harkin asked Dr. Cohen what impact wage discrimination against women has on men. Dr. Cohen responded that there is no evidence that increasing women’s wages causes the men’s wages to decrease. He added that the wage gap limits family incomes and limits the occupational choices men make. “Men could have more flexibility to pursue jobs that women traditionally perform if wages were increased.”