Newly Proposed Congressional Bill Targets Wage Gap
Just after returning from summer recess, Congress is off to a promising start with exciting proposed legislation for employees. On September 15, 2016, Congresswoman Eleanor Holmes Norton, democratic delegate from the District of Columbia, introduced the Pay Equity for All Act of 2016 (H.R. 6030). The Bill aims to narrow the wage gap for women and minorities.
The new Bill would amend the Fair Labor Standards Act to prohibit employers from screening job candidates based on their wage or salary histories. The Bill would make it unlawful for employers to require applicants to disclose their compensation histories as a condition of being interviewed or considered for a job offer. Further, the Bill would authorize the Department of Labor to assess fines of up to $10,000 against violating employers. Prospective or current employees would also be able to file suit against a violating employer for up to $10,000 in damages plus attorneys’ fees.
Policy analysts predict that the Bill will help to alleviate wage discrimination. Many employers set wages based on an applicant’s previous salary. Women and minorities, who are historically disadvantaged in terms of pay equality, often start out behind their white male counterparts. Thus, when employers set new wages based on that history, whether discrimination is intended or not, these groups often can never catch up.
There are many reasons for this unfortunate wage gap. In some cases, women and minorities are paid less than their white and/or male counterparts because of basic wage discrimination. In other cases, women may be paid less because they often take time out of the workforce as the primary caregivers in their families. Additionally, studies point to perhaps one of the most interesting reasons for the wage gap– women are less likely to negotiate their salaries when they apply for jobs, and when they do, they ask for less than men do.
For instance, one study found that, on average, women asked for $7,000 less than their male peers when negotiating their salaries. Other studies have found that when given the same salary negotiation script during a simulation, women who negotiated were perceived more negatively than their male counterparts. The men who negotiated were viewed with approval, whereas the women were viewed as “too demanding.” Another study has found that both men and women risk being perceived as unlikable when they negotiate their salaries, but people did not care if they work with unlikeable men, whereas they do care and do not want to work with unlikeable women.
While the Pay Equity for All Act of 2016 would not prohibit salary negotiations altogether, the Bill does set out to eliminate the historical cycle of pay inequality by prohibiting employers from asking about prior compensation. This will allow women and minorities the freedom and confidence to push for wages at a level commensurate with their knowledge, skills, and value. Additionally, applicants should be free to ask for wages on par with their white and/or male counterparts and not be boxed in by the potentially discriminatory wages they received at a previous job.
The new Bill is a welcome, fresh approach to a long-entrenched wage gap problem. If the Bill becomes law, employees, and especially women and minorities, should look forward to progress in closing that gap. Let’s hope that the legislature responds receptively to the Bill and recognizes its importance to promoting wage equality for employees.
