Equal Pay Day Reminds Employers to Take Steps Now to Ensure Pay Equity

On April 2, workers’ rights groups held rallies in major cities across the country to mark Equal Pay Day, which serves to remind us how much longer into the year women would have to work in order to earn as much as men. Chicago was no exception. Hundreds of political leaders and activists gathered to raise awareness and put added pressure on policy makers and employers to do something about the pay gap.

As previously reported here Illinois and federal lawmakers are listening, as they’ve kicked off the year with announcements of plans for sweeping reforms to address the problem.

Recent Census Bureau data reveals that, among full-time workers, the average woman makes about 80 cents for every dollar made by a man. The gap widens even more for women of color.

Congress passed the Equal Pay Act (EPA) to combat the gender wage gap, by outlawing the payment of unequal wages for equal work. In the past several months, employers have faced an unprecedented wave of EPA and sex discrimination lawsuits, including high profile cases against Google and even large employer-side employment law firms .

What does all of this mean? Employers large and small should treat pay equity as a top employment compliance concern now. They should take four steps immediately:

  • Step 1: Update Compensation Policies Make sure compensation policies set forth clear guidelines to tie pay and benefits to measurable, objective and gender-neutral criteria, and that anti-discrimination policies clearly prohibit discrimination in pay on the basis of sex.
  • Step 2: Review Compensation Practices Employers should regularly review their pay practices to ferret out any cases of possible intentional or unintentional pay discrimination and confirm that differences in pay are based on legitimate factors supported by written documentation. These reviews typically are best conducted under cloak of attorney-client privilege with the help of an experienced employment law attorney .
  • Step 3: Train Managers on the EPA Anyone with a role in determining employee pay should be told that their compensation decisions must be gender-neutral and based on experience education, skill and merit.
  • Step 4: Document and Keep Records of Key Personnel DecisionsHR and supervisors should document the legitimate reasons for promotion, performance and pay decisions so, if challenged, they’re ready to justify different levels of pay for workers who perform the same or similar work. Remember, the EPA requires employers to keep records explaining any wage differential between male and female employees and any substantiating documents for two years. This is on top of the FLSA requirement to keep payroll records for three years from termination.

This article is part of a series that highlights legal changes Illinois employers must know now. We’ll keep you updated on newly introduced laws as they’re debated and enacted. You can follow our blog here or connect with us on LinkedIN to receive future posts in your news stream.

Gary Savine is founder of Savine Employment Law Ltd, and regularly litigates gender discrimination and wage cases on behalf of workers and employers.. Gary also performs employment compliance audits and investigations for employers.