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The Equal Pay Act—Is Your Business Helping or Hurting the Cause?

In 1963, when the Equal Pay Act (“Act”) was signed by President Kennedy, women were earning an average of 59 cents on the dollar when compared to men.[1] Today, women earn about 80 cents on the dollar.[2] President Obama addressed the issue of equal pay in his second inaugural address, “[O]ur journey is not complete until our wives, our mothers and daughters can earn a living equal to their efforts.” Where does your business stand on the journey to equal pay? Equal pay may not be something that is high on your radar as an employer, but you should always be assessing if your business is compliant with applicable laws and whether employees are being treated fairly.

The Act generally requires covered employers to provide equal pay to persons (both men and women) who are performing the same job. It is important to know that job titles are irrelevant in the ‘same job’ assessment; it is the content that determines whether jobs are substantially similar. All forms of pay are subject to the Act—salary, overtime pay, bonuses, benefits, etc. The Act is an amendment to the Fair Labor Standards Act, thus employers are prohibited from retaliating against an employee who files a claim pursuant to the Act.

An employee does not have to show that the employer’s pay disparity is intentional or based on gender; the fact of a pay disparity for substantially similar jobs is enough. Interestingly, an individual alleging a violation of the Act can go directly to court and is not required to file a discrimination charge with the Equal Employment Opportunity Commission (“EEOC”) beforehand. It is the only law enforced by the EEOC which allows for this course. An individual can bring a claim within two years of the alleged unlawful compensation practice or, in the case of a willful violation, within three years.

In addition to the Act, there are other federal and state laws that prohibit employers from discriminating on the basis of gender in employment decisions. Title VII of the Civil Rights Act of 1964, for example, makes it illegal to discriminate based on sex in pay and benefits, too. If you are an employer and have questions about the Equal Pay Act or other federal or state law, contact the attorneys at McBrayer for answers.

This article is intended as a summary of federal or state law and does not constitute legal advice.

[1] www.dol.gov/equalypay/

[2] Id.

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