Studies throughout the United States have shown that men and women doing the same types of jobs with comparable levels of experience often earn different wages. The discrepancy between men and women’s paychecks is commonly known as the “gender wage gap” and skews in favor of men across a variety of industries. As of 2018, women’s median earnings are 82% of men’s.
Several companies have taken measures to reduce the gap, but while the gap is narrowing, it remains a persistent problem. Earlier this year, Gov. Jared Polis signed the Equal Pay for Equal Work Act into law in Colorado to empower employees who may face pay discrimination. Employers have until January 1, 2021, to comply with the new regulations.
The Equal Pay for Equal Work Act aims to improve work conditions while also protecting employers. Business-friendly amendments shield companies from lawsuits by giving them plenty of time to comply with the new law’s provisions. Instead of punishing businesses with a wage gap, it pressures employers to fix pay disparities through their own employment policies.
Colorado’s Equal Pay for Equal Work Act allows employees who believe they’re receiving unfair wages due to their sex to file a complaint against their employers within two years of discovering a pay imbalance. An employer who is found to have paid an employee less on the basis of sex must make it up to the employee by paying them the amount they would have made the previous three years in a non-discriminatory environment.
The law is not meant to force employers to pay higher wages just because a pay imbalance exists. If the salary disparity was unintentional, companies are safe from lawsuits. The law also guides businesses in proving good faith by completing pay audits within their workforces. Companies that complete pay audits and address pay disparities now can avoid adverse legal actions when the law takes effect in 2021.
Finally, the law also has provisions for hiring practices, including requiring job listings to state the position’s salary range. Hiring managers may not ask job applicants for their salary history or retaliate against applicants who refuse to disclose how much they’ve made at their previous job.
The fight for equal pay for equal work is centuries old. In modern times, it can be traced back to World War I. During the First World War, many English women took men’s jobs since men were deployed in the armed forces. When they realized they were expected to perform the same duties as men for lower wages, they fought for equal pay through a series of strikes and were eventually successful.
In America, efforts to close the wage gap escalated during World War II when thousands of American women entered factory jobs. In 1945, the U.S. Congress introduced the Women’s Equal Pay Act. The measure attempted to make it illegal to pay women less than men for work of comparable quality and quantity but failed to pass. The issue became a significant talking point among women’s trade unions and other organizations through the 1950s; unfortunately, women’s groups made little progress until the 1960s.
National legislation passed in 1963 when John F. Kennedy signed the Equal Pay Law despite opposition from business leaders and the U.S. Chamber of Commerce. At the time, these organizations justified paying women less by claiming women were more expensive to hire than men.
Today, the Equal Pay Act (EPA) prohibits sex-based wage discrimination. Men and women who work in the same establishment and perform jobs that require equal skill, effort and responsibility in similar working conditions must receive comparable wages. Wages can include more than hourly or annual pay. Under this law, the term “wages” includes bonuses, company cars, expense accounts, insurance policies, and more.
Lilly Ledbetter worked for Goodyear Tire for 19 years. During that period, she persistently received poor reviews from her supervisor, low wages, and ultimately learned that she was paid far less than her male coworkers. Eventually, Ms. Ledbetter sued Goodyear. In 2007, her case made it all the way to the Supreme Court. In Ledbetter v. Goodyear Tire & Rubber Co., Inc., she lost her case on appeal and received no restitution.
Two years later, the Obama Administration signed the Lilly Ledbetter Fair Pay Act of 2009. The law sought to make it easier for employees to file complaints against employment practices that result in unfair pay. The Act states that each paycheck that contains discriminatory compensation is a separate violation regardless of when the discrimination started. Under this law, individuals who face pay discrimination may seek amends through federal anti-discrimination laws.
Attorney Nathan Davidovich of the Davidovich Law Firm, LLC, has provided exceptional legal counsel for employers in Colorado for more than 55 years. As an advocate of fair employment practices, he strives to help employers comply with ever-changing labor laws at the state and federal level.
By law, employers have until January 1, 2021, to comply with Colorado’s Equal Pay for Equal Work Act. If you need advice on adopting employment practices that will help your business avoid adverse legal actions from your employees, schedule a consultation with Nathan by calling (303) 825-5529 or complete our contact form.