social class and social stratification

76 contexts.org

In brief: • 55 years ago, Congress passed the

Equal Pay Act (“EPA”), but women still

make just 80 cents for every dollar paid

to men. The wage gap varies by race

and is larger for women of color. • Loopholes and inadequacies in the

EPA, bad court rulings, and continued

discrimination against women in the

workforce allow wage gaps to persist. • Congress should pass the Paycheck

Fairness Act to update and strengthen

the EPA and provide robust protection

against sex-based pay discrimination in

the workplace. • States across the country are introduc-

ing and passing similar legislation, and

public support for closing the wage

gap is high. • Addressing discrimination and ensur-

ing women receive equal pay would

have a signifi cant positive effect on our

economy.

In the last four decades, women’s

educational levels and work experiences

have increased dramatically. Women are

over half of college graduates and nearly

half the workforce, and families rely on

women’s earnings. However, women are

still paid less than men. More than half

a century after the passage of the Equal

Pay Act (EPA), a woman working full-

time, year-round in 2017 was typically

paid just 80 cents for every dollar paid

to a man working full-time, year-round.

The gender wage gap varies by race and

is larger for most groups of women of

color: nationally, Black women, Native

women, and Latinas working full-time,

year-round were typically paid just 61

cents, 58 cents, and 53 cents, respec-

tively, for every dollar paid to their non-

Hispanic White male counterparts, while

non-Hispanic White women were paid

77 cents for every dollar paid to non-His-

panic White men. Asian women working

full-time, year-round were typically paid

85 cents on White non-Hispanic men’s

dollar, but the wage gap is substantially

larger for some communities of Asian

women. Gender wage gaps persist in

all 50 states and in nearly every occupa-

tion. Signifi cant wage gaps also exist for

mothers compared to fathers, LGBTQ

women compared with men, and women

with disabilities compared to men with

disabilities.

Skeptics of the wage gap contend

that it is due to differences in education

levels or the kinds of jobs that women

choose. But studies show that at the very

beginning of a woman’s career, just one

year after college graduation, women

working full time were paid only 82%

of what their male colleagues earned

and we know that wage gaps grow over

time. For women overall, even when

accounting for factors like unionization

status, education, occupation, industry,

work experience, region, and race, 38%

of the wage gap remains unexplained.

Data make clear that discrimination—

based on conscious and unconscious

stereotypes—is a major cause of this

unexplained gap. A recent experiment

revealed, for example, that when pre-

sented with identical resumes, one with

the name John and the other with the

name Jennifer, science professors offered

the male applicant for a lab manager

position a salary of nearly $4,000 more,

additional career mentoring, and judged

him to be signifi cantly more competent

and hirable. When women lose out on

earnings because of discrimination, fami-

lies and the economy suffer. Addressing

discrimination and closing the gender

wage gap would have a signifi cant posi-

tive impact on the economy, including

helping to tackle the problems of poverty

and wealth inequality.

the paycheck fairness act Although the EPA has helped to

narrow the wage gap over the last 55

years, loopholes and inadequacies in the

law have allowed pay discrimination to

continue. Employees lack the tools they

need to effectively fi ght against pay dis-

crimination, and employers lack incen-

tives to proactively reduce pay disparities.

The Paycheck Fairness Act (PFA) would

update and strengthen the EPA and is a

critical measure to address pay discrimi-

nation. It would move us closer toward

closing gender and racial wage gaps.

The PFA uses a diverse set of tactics

to strengthen protections against pay

discrimination. Among other provisions,

the bill increases pay transparency, an

essential tool in the fi ght for equal pay.

Of all forms of discrimination, pay dis-

crimination is among the most diffi cult

to detect and address. Because of a cul-

ture of secrecy around pay, women can

be paid less than the men working next

to them for years without realizing it.

In fact, 60% of private sector employ-

ees report that discussing their wages

eradicating wealth inequality includes achieving equal pay by sarah david heydemann and andrea johnson

policy brief

77W I N T E R 2 0 1 9 c o n t e x t s

is either prohibited or discouraged by

employers. The PFA would, instead, pro-

hibit employers from punishing employ-

ees for sharing pay information with

their coworkers. It also directs the Equal

Employment Opportunity Commission

(EEOC) to collect employee compensa-

tion data and other employment-related

data from employers, broken down by

sex, race, and national origin. These data

would give the EEOC an invaluable tool

for fighting pay discrimination by shin-

ing a light on pay patterns that raise red

flags, so that the EEOC can more effi-

ciently and effectively use its resources for

enforcement, education, and outreach to

address pay discrimination. It would also

ensure that employers are proactively

examining their own pay data and cre-

ate a powerful incentive for employers

to correct unjustified pay gaps.

Further, the PFA would help strip

bias out of common employer practices,

like pay setting, by preventing employ-

ers from relying on a job applicant’s sal-

ary history to set pay when hiring new

employees. When an employer relies on

an applicant’s previous salary to set pay,

women and people of color can carry

pay discrimination and lower wages from

job to job. Preventing reliance on salary

history in pay setting is a simple step to

help ensure that salary is based on an

applicant’s relevant skills, experience, and

the responsibilities they will be assum-

ing, rather than what they happened to

be paid in their past job, which may be

infected by pay discrimination.

Over the years, courts have inter-

preted the EPA in ways that have created

legal loopholes and weakened protec-

tions for plaintiffs. For instance, the EPA

allows employers to defend against pay

discrimination claims by asserting that

a pay differential is based on a “factor

other than sex.” Some courts have inter-

preted this defense so broadly that factors

such as a male worker’s stronger salary

negotiation could qualify as a defense.

The PFA would tighten this language

to excuse a pay differential only where

the employer can prove it is truly caused

by something other than sex, is related

to job performance and consistent with

business necessity, and accounts for the

entirety of the pay differential. Courts

have defined other EPA measures in an

overly narrow manner. Under the EPA,

for instance, wage comparisons must be

made between employees working at the

same “establishment.” Courts have nar-

rowly defined this requirement to mean

that wages paid in different facilities or

offices of the same employer cannot be

compared. The PFA clarifies that compari-

sons may be made between employees in

workplaces in the same county or similar

political subdivision.

The PFA would help give people

access to justice by ensuring that indi-

viduals can come together to challenge

discrimination through a class action and

improve remedies for those who do come

forward. This would put the remedies

available for gender-based wage dis-

crimination on equal footing with those

already available for discrimination based

on race or ethnicity.

equal pay increases economic security

The passage of the PFA would be a

critical step toward achieving equal pay

and lessening wealth inequality. When

women are paid less than their male

counterparts, their smaller paychecks

have long-lasting repercussions for their

housing, education, health, and retire-

ment. They and their families face not

only an immediate loss of income but

potentially years of decreased earnings,

job stability, and economic insecurity.

For example, based on today’s wage

gap, a Black woman stands to lose an

astounding $946,120 over the course

of a 40-year career. She would have

to work until she was age 84 to catch

up to what a White, non-Hispanic man

would be paid by age 60. This dispar-

ity in earnings over time prevents Black

women from building wealth and sav-

ing for retirement. Recent data show

that single Black women have a median

wealth amounting to just $200—a frac-

tion of the $15,640 typically accrued by

single White women and the $28,900

typically accrued by single White men.

Closing the wage gap means not

just more money in women’s pockets, but

a stronger economy overall—to the tune

of an additional $512.6 billion. Those

added billions would result in a dramatic

decrease in poverty rates for working

Contexts, Vol. 18, Issue 1, pp. 76-78. ISSN 1536-5042, electronic ISSN 1537-6052. © 2019 American Sociological Association. http://contexts.sagepub.com. DOI 10.1177/1536504219830684

When women are paid less than their male counterparts, it has long-lasting repercussions for their housing, education, health, and retirement.

78 contexts.org

women and for the many families that

depend on women’s earnings. A recent

study found that if women received the

same compensation as their male coun-

terparts, the poverty rate for all working

women would be reduced by half, from

8.0% to 3.8%. Moreover, nearly 60%

of women would earn more if work-

ing women were paid the same as men

of the same age with similar education

and hours of work. Closing the gender

wage gap is especially critical for work-

ing mothers. In 2015, 42% of mothers

were the sole or primary breadwinners in

their families and another 22.4% were

co-breadwinners, meaning mothers’

earnings are critical to families’ financial

security. Yet in 2016, more than half of all

poor children lived in families headed by

women and female-headed households

with children were much more likely to be

poor (35.6%) than male-headed house-

holds (17.3%). If we achieve equal pay,

the number of children with working

mothers living in poverty would fall from

5.6 million to 3.1 million. More equal pay

for women means increasing economic

security for women, their families, and

our communities.

moving forward Not surprisingly, recent public opin-

ion data show that 79% of women

and 70% of men surveyed felt equal

pay should be a top priority for lawmak-

ers, and policies to close the wage gap

are making headway in states and cities

across the country. In the past few years,

lawmakers have introduced legislation in

over two-thirds of the states to address

pay discrimination, and many of these

bills have become law. Many of these

laws are modeled on the PFA and some

even go further in enacting protections,

such as requiring employers to provide

salary ranges to job applicants in order to

level the playing field in salary negotia-

tions, where women often ask for less

when they negotiate than men, even

when the women applicants are other-

wise equally qualified and applying for

similar jobs as their male counterparts.

The Paycheck Fairness Act is an

essential tool for individuals and advo-

cates to prevent, identify, and fight

against pay discrimination. But it is only

one piece of the policy agenda necessary

for women to truly achieve equality at

work and in pay. For example, mothers

experience a particularly large wage gap.

Policies that help mothers and families

will work to lessen the wage gap includ-

ing by requiring that pregnant workers

with a need for an accommodation be

provided reasonable accommodations

so they can keep working; adopting

nationwide paid family and medical leave

and paid sick leave; providing access to

affordable, high quality childcare; and

ensuring fair work scheduling practices—

all of which help ensure that caregiving

doesn’t push women out of work or into

lower paying jobs. Likewise, while no

occupation is immune from it, sexual

harassment is a barrier to women’s partic-

ipation in higher wage, traditionally male-

dominated occupations, so strengthening

protections from harassment and related

retaliation will help women to access

these higher-paying jobs, and work to

close the gender wage gap. Relatedly,

women’s overrepresentation in low-wage

and tipped jobs is a key driver of the

wage gap, so in addition to lowering

barriers for women to access higher wage

jobs, raising the minimum wage and

doing away with the unfair and unjust

two-tiered minimum wage system for

tipped workers will help to close the gap.

To make real strides in eradicat-

ing wealth inequality and realizing an

economy in which we can all prosper,

we must work to close gender and racial

wage gaps and ensure equal pay—and

that starts with the Paycheck Fairness Act.

For links to all of the studies and fact-

sheets used within this brief, please visit

contexts.org/articles/PFA.

Sarah David Heydemann is a Legal Fellow and

Andrea Johnson is Senior Counsel for State Policy

at the National Women’s Law Center.

The passage of the Paycheck Fairness Act would be a critical step toward achieving equal pay and lessening wealth inequality.

policy brief