by Mitch Kokai
Senior Political Analyst, John Locke Foundation
This law would make almost any difference in pay between employees grounds for a lawsuit. If it passes, businesses could be in legal jeopardy for giving raises and bonuses.
Supporters intend the Paycheck Fairness Act to combat sex discrimination. Certainly sex discrimination is wrong. Women and men doing equal work deserve receive equal pay. Both Title VII of the 1964 Civil Rights Act and the Equal Pay Act of 1963 prohibit doing otherwise. Paying employees differently because of their sex violates the law.
The Paycheck Fairness Act isn’t necessary to combat sex discrimination – and it would potentially put employers at risk for decisions, totally unrelated to gender, to pay different employees different salaries.
For instance, companies can pay highly educated workers more than less educated ones. They can pay experienced employees more as well. Most employers reward good performance with higher wages. Such pay systems do not violate the law. Under the Paycheck Fairness Act they could. …
… [T]he law would essentially not count factors like education, performance, or experience, as valid reasons for some to be paid more than others unless employers showed they absolutely had to structure their business that way.
Consider a company with many male employees that pays experienced workers more than new hires. If they hired a woman, the PFA would let her sue over her lower pay. The company would have to prove that “business necessity” required premium pay for experienced workers. If the company won the suit she could then propose “an alternative employment practice”— intensive training to get caught up to the senior workers, followed by equal pay scales. If the company refused she could sue again. The employer would have to prove in court the employee’s proposal did not “serve the same business purpose” as paying senior workers more.