Legislation
to close the so called “wage gap” in New Jersey was approved on February 4 by
the Senate Labor Committee and will now head to the Senate floor for
consideration. This bill would impose enormous burdens and risks on employers
by expanding the federal Lilly Ledbetter Act, opening businesses up to
potentially bankrupting lawsuits. S997 will force small businesses to devalue
important factors such as training, education, and skill that most employers
use to establish wages.
S-992
would:
Prohibit
unequal pay for “substantially similar” work, under the Law Against
Discrimination (LAD).
The legislation would make it unlawful for an employer to pay a rate of
compensation, including benefits, to an employee of one sex less than the rate
paid to an employee of the other sex for substantially similar work when viewed
as a composite of skill, effort and responsibility, unless specific conditions
apply.
Require
different rate of compensation be justified by factors other than sex. The bill permits an employer
to pay a different rate of compensation if the employer demonstrates that the
differential is made pursuant to a seniority system, a merit system, or is
based on legitimate, bona fide factors other than sex, such as training,
education, experience, or the quantity or quality of production. It requires
that each factor is applied reasonably, that one or more of the factors account
for the entire wage differential, and that the factor or factors do not
perpetuate a sex-based differential in compensation, are job-related and based
upon legitimate business necessities. Comparison of wage rates would be based
on those in all of an employer’s operations or facilities.
Restart
statute of limitations for each instance of discrimination. Provides that a
discriminatory compensation decision or other employment practice that is
unlawful under the LAD occurs each time that compensation is paid in
furtherance of that discriminatory decision or practice – effectively making
each paycheck another instance of discrimination, reflecting the language in
the federal Lilly Ledbetter Fair Pay Act. In addition, the bill provides that
liability shall accrue and an aggrieved person may obtain relief for back pay
for the entire period of time in which the violation has been continuous, if
the violation continues to occur within the statute of limitations. This
provision is stronger than the federal Lilly Ledbetter Act, which has a
two-year cap on back pay.
Prohibit
employer retaliation against employee for disclosing compensation. Employers could not take
reprisals against an employee for disclosing information about the job title,
occupational category, and rate of compensation of any employees or former
employees, as well as other information. It would prohibit an employer from
requiring an employee or prospective employee to forgo rights to make or
request those disclosures.
Require
transparency in state contracting. Requires contractors to provide information on
gender, race, job title, occupational category and compensation, and to report
certain changes during the course of the contract; information must be filed
with Labor Commissioner and Division of Civil Rights. The bill requires
disclosure to employees and their authorized representatives upon request.
The “Wage Gap”
Myth:
- A 2009 U.S. Department of Labor
study
controlling for profession and education found a gender wage gap of less than
10 percent and concluded “the raw wage gap should not be used as the basis
to justify corrective action.” - “differences
in the life choices of men and women — such as women tending to leave the
workforce when they have children — make it difficult to make simple
comparisons.” The Washington Post - The
“77-cent” figure used is misleading. To the extent a wage gap even
exists, it’s a reflection of different choices men and women make when it comes
to work. Men are more likely to work longer hours, and in more dangerous,
physically demanding conditions. – Carrie Lukas, Managing Director of the
Independent Women’s Forum - The
“77-cent” statistic that is constantly used to prove that wage discrimination
exists misleadingly compares all male and female workers, regardless of their
occupation. If you look at men and women working in the same professions, the
pay gap is much smaller – Politifact - While calculations that led to
the 77-cent figure did not include any part-time workers, the label “full
time worker” can actually be applied to employees with a wide range of
hours worked per week. The official Bureau of Labor Statistics definition of a
full-time worker is someone who works at least 35 hours per week. Someone who
gets no vacation time and works 40 hours a week for 52 weeks would work 2,080
hours in a year. By contrast, a worker on a 36-hour-per-week schedule who has
two weeks off would work only 1,800 hours. Meanwhile, a worker with two weeks
off who averaged four hours per week of overtime would end up with 2,200 hours.
“Some workers have even longer work schedules than that, especially when
the economy is expanding rapidly,” Burtless said. “So even among
full-time, year-round workers, there is considerable variability in annual work
hours.” This variation can work its way into the gender pay gap if women
seek more flexible schedules or if men happen to fill jobs with greater
opportunities for overtime. – Politifact - The other complicating factor
involves seniority on the job. Men have typically held their jobs longer than
women in the same position. According to the Bureau of Labor Statistics, men in 2010 who were between
45 and 54 years old had a median job tenure of 8.5 years, compared to 7.1 years
for women in the same age group. – Politifact