Equal Pay Act Explained

Fri, May 22, 2009

Accounting, Business

In decades past, gender discrimination in the workplace was rampant. It was perfectly legal for employers to pay women less than men who were in the same position, even if their seniority and quality of work were equal for accounting. Newspapers even published job listings for men and women separately, and the same jobs advertised for men were often advertised for women with lower pay.

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Pressure to give women equal pay for equal work began during World War II, when more women began to enter the workforce in the absence of men who were in the military. But it wasn’t until two decades later that a law was passed making discrimination in pay illegal. The Equal Pay Act went into effect on June 11, 1964.

The Equal Pay Act is an amendment to the Fair Labor Standards Act. Although intended to help women in the workplace, the law states that neither sex may be paid less than the other for the same work when everything else is equal. This requirement may not be avoided by using different job titles for equivalent jobs.

Rulings and Amendments

There have been many court cases involving the Equal Pay Act. One of the most important was Schultz v. Wheaton Glass Co., in which it was ruled that jobs need only be substantially equal, not identical, to require protection under the Equal Pay Act. Corning Glass Works v. Brennan determined that paying women less because they would receive less under the “going market rate” was illegal. And Ledbetter v. Goodyear set the rules for the statute of limitations for equal pay lawsuits.

Under Ledbetter v. Goodyear, plaintiffs had 180 days from the date pay was agreed upon to file a lawsuit under the Equal Pay Act. So if a worker did not discover inequality in pay until after that time frame, she had no recourse. But the Lilly Ledbetter Fair Pay Act of 2009 amended the law so that the statute of limitations is reset with each discriminatory paycheck. That means that workers now have until 180 days after receiving their final paycheck to file suit.

Legal Defenses

In order to establish a case under the Equal Pay Act, an employee must prove that wages differ between sexes for equal work that requires equal skill, effort and responsibility, and that working conditions are similar in each cited case. If these things are proven, the employer may avoid liability only by proving that wages are determined by seniority, merit, production quantity or quality, or some other factor besides gender.

The Equal Pay Act has narrowed the wage gap between the sexes, but women still earn less than men. This is often attributed to lower raises and shorter duration of employment for women. While the Equal Pay Act has improved pay for women, there is still plenty of room for improvement.

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This post was written by:

Richard Tyler - who has written 439 posts on Free Investment Advice.

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