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Pay equity is the law, but wage gap between men and women still exists

WRIGLEY

By BECKY GILLETTE

Despite the fact that pay equity is the law, studies show women earn less money than men for doing the same work. This pay gap does not necessarily decrease simply because more women are achieving “bread winner” status, said Jaklyn Wrigley, a Gulfport-based attorney with Fisher Phillips, a national, management-side labor and employment law firm.

“Technically, since the passage of Title VII of the Civil Rights Act of 1964, pay equity has been the law,” Wrigley said. “You can’t treat women differently as it concerns terms and conditions of employment because they are women. Over the years we have seen pay equity grow from this concept. It is now well-settled that both Title VII and the Fair Labor Standards Act require pay equity. To add to this requirement, the Equal Employment Opportunity Commission (EEOC) recently extended its EEO-1 requirements to help uncover possible gender- and race-based pay discrimination and systematic disparities.”

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Beginning in March 2018, companies with 100 or more employees will be required to provide related data beginning with 2017 W2 information. Wrigley said this means current practices will be up for review, not only by the federal government, but also by plaintiffs’ attorneys.

Wrigley said employers need to take note that the wage gap exists, even in the most profitable industries. In April, CNN Money reported that female doctors make 74 cents for every dollar their male counterparts make. That translates to roughly $91,000 each year.

“This is larger than the national average wage gap, which the Department of Labor calculated as 82 cents for 2016,” Wrigley said. “If female doctors earn less than male doctors, there is a good chance you could have pay disparity issues affecting your workforce.”

Another reason to consider the issue is that employee stress affects the work product.

“We know that stress is bad for us. In fact, Harvard Business School and Stanford University researchers report that stress is just as bad for your health as second-hand smoke,” Wrigley said. “Troublingly, this problem is not going away, and WalletHub recently reported that stress levels are on the rise in 2017. If you live in Mississippi, the situation is even more dire, as we are ranked in the top three most stressed states in the U.S. Our neighbor Louisiana joins us.”

Finances are one of the leading causes of stress. Because more and more women are becoming breadwinners, the wage gap is poised to cause additional stress.

“Employees who are stressed (regardless if they are victim to pay disparity) are distracted, causing job performance to slip,” Wrigley said. “Employers cannot eliminate all sources of stress, but the wage gap is something they can control.”

For business owners to support women in the workplace, she recommends taking a look at your company’s pay practices. To do this, complete an internal audit of your payroll practices. If you identify pay disparity, you will want to determine if a legitimate factor other than gender explains it. Consultation with a labor and employment attorney can help.

It is also recommended that you remove the “past salary” box from your job applications.

“A common theory to explain the continued wage gap is that new employers believe they can pay a woman applicant less based on her previous salary,” Wrigley said. “Philadelphia and Massachusetts are requiring employers to remove the ‘past salary’ box on job applications. While there is no indication that Mississippi will follow in their footsteps anytime soon, because of the other benefits to eliminating pay disparity, this may make sense for your company.”

Another strategy is to combat toxic work environments for female breadwinners by supporting female leadership. Having women in decision-making capacities may work to change male-dominated culture from within. Wrigley said having a diversity of perspective also creates a more dynamic, productive and profitable business.

The Department of Labor calculated the pay gap as 18 cents in 2016. That is, for every dollar a man earns, a woman earns 82 cents. While there is much debate on the accuracy of that calculation, Wrigley said it seems to be a well settled proposition that pay disparity exists.

“In fact, the Treasurer of Mississippi Lynn Fitch recently commissioned a study to look into Mississippi’s version of the pay gap,” Wrigley said. “Fitch discovered that women in Mississippi earn 27 percent less than men in our state. This is actually a larger gap than the Department of Labor’s. Many factors, some that are out of the employers control, contribute to this, but an employer does have control on how much it pays its employees. There is a legal obligation to avoid disparity, if not also a moral one.”

Researchers have found that women ask for raises and negotiate their salaries less frequently than men. Wrigley said the explanations for why this is and how to remedy this finding vary.

“One thing is clear,” she said. “Women who start off their careers by not negotiating leave a lot of money on the table over the course of their lifetime. There are numerous schools of thought on how to approach asking for an increase. Many have criticized that aggressive demands for raises are not attractive regardless of whether male or female employees make them. There are no hard-and-fast rules. What is deemed ‘appropriate’ for an individual woman will depend on her circumstances. That said, any employee should approach a discussion about salary or benefits in a respectful and prepared way for higher chances of success.”

Some employer forbid employees from discussing the amount of their salaries with other employees.

“While this runs afoul with the law, it nevertheless occurs with some employers,” Wrigley said. “The National Labor Relations Act – specifically, Section 7 – protects an employee’s right to discuss wages and other benefits. So, women (or men) are permitted by law to raise this issue with co-workers. Frequently, however, employers will prohibit employees from discussing their earnings with each other.”

About Becky Gillette

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