An Illinois proposal that would have prevented employers from requiring applicants to disclose their prior wages or salary during the hiring process unexpectedly failed during the Illinois General Assembly veto session on November 9. This comes as a surprise, as earlier this year, the proposed amendments and expansion to the Illinois Equal Pay Act passed through the House and the Senate with strong majorities. Don’t get fooled into thinking we’ve seen the last of it, however, as signs point to a renewed attempt to pass similar legislation in the near future.
Two advocacy organizations, concerned that national pay equity action has been stalled, recently filed a lawsuit in federal court aiming to resurrect the beefed-up EEO-1 reporting requirements which would have forced employers to shed light on their compensation practices. Not satisfied with the tide of activity that is taking place at the state level, these organizations are hoping the courts will breathe new life into the federal effort to bolster consistent pay equity standards across the country. What do employers need to know about this latest development?
When you combine an increased social awareness of pay disparity issues with an influx of new pay equity legislation at the state and local level, it’s no surprise that lawsuits involving large and high-profile employers are popping up in the headlines on almost a daily basis. Regardless of the size of your organization, you shouldn’t be surprised if your employees begin asking questions about their pay, challenging your compensation practices, or even file a lawsuit.
The 3rd Circuit’s affirmation of summary judgment in a pay equity case after ten years of litigation shows that even non-meritorious claims can be time-consuming and costly. As many who have been involved in lawsuits know, they typically are costly and sometimes move about as swiftly as a tortoise on the back of a snail covered in molasses. And, unfortunately—and especially for defendants in employment-related cases—the longer they last typically the more expensive they are to defend.
It is no secret that pay inequity has plagued the United States and abroad for as long as women have been in the workforce. Although the U.S. and other countries have had laws on the books, in many cases for decades, prohibiting discrimination against women with respect to pay, the issue remains. On average, women still make 20 percent less than men performing the same work. Pay inequity has resulted in a growing number of lawsuits against employers on a worldwide basis, often leading to sky-high defense costs, and hefty damage awards.
No one denies the pay gap between men and women exists. However, there is much debate as to how best to close that gap. In the United Kingdom (UK), legislators are employing a “naming and shaming” strategy to try to use to use the power of public accountability to push employers toward greater pay equity.