Legally Mandate Wage Transparency

Tanya Hernandez in The New York Times, March 31, 2013

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Tanya Hernández teaches comparative employment discrimination at Fordham University School of Law and is the author of “Racial Subordination in Latin America.”

Five decades after the Equal Pay Act of 1963, women continue to be paid less than men even when they have the same college education, area of study and experience. It is thus not irrational to question the adequacy of our current laws to transform the labor market.

Although gender inequality in wage structures is pervasive across all occupational levels, the legal complaints for wage discrimination filed before the U.S. Equal Employment Opportunity Commission consistently make up only about 1 percent of all discrimination claims filed.

The Paycheck Fairness Act, pending once again in Congress, seeks to reform the deficiencies in the Equal Pay Act in part by abolishing the ability of employers to punish employees who share their salary information with one another. The proposed law would also require employers to prove that pay disparity is related to job performance, allow employees to seek punitive damages for pay discrimination, and establish a grant program for salary negotiation training. Such updates to the Equal Pay Act would certainly make modest improvements in the usefulness of the law. In fact, a few states like California, Colorado, Illinois and Michigan, already prohibit employers from taking action against employees who discuss their wages with others.

But in order to fully address salary parity the law must do more than simply protect maverick employees. In a society that still views the discussion of salary details as taboo and “impolite,” women will remain impeded if they try to access concrete salary information. A legal mandate for employer wage transparency is necessary. Publishing an annual list of salary ranges that correspond to relative job positions would more effectively empower the legal system to ferret out wage discrimination. It's certainly helped narrow the gap within the federal government, which offers greater wage transparency than the private sector.

Furthermore, companies with a practice of complete salary transparency have found that rather than create resentment, the practice dispels employees' anxieties and fosters trust and productivity. In short, pursuing equality in the workplace benefits employers and employees alike. Our laws should be reformed to enhance that pursuit rather than hinder it.