The Equal Pay Act requires that men and women in the same workplace be paid an equal amount for equal work. Almost all employers are subject to the EPA, and all pay is subject to protection: salary, overtime, bonuses, stock options, profit sharing, life insurance, vacation, holiday pay, allowances, reimbursement and benefits.
Employers are paying more attention to the Equal Pay Act as certain of them will soon have to identify salary as part of Equal Employment Opportunity reporting compliance.
To be protected by equal pay, the jobs do not have to be identical, but they must be substantially equal. Job content, not job titles, determine if jobs are substantially equal. The EPA specifically requires that employers may not pay unequal wages to men and women who perform jobs that require substantially equal skill, effort and responsibility and that are performed under similar working conditions within the same establishment.
- Skill is measured by the experience, ability, education and training required for the job. The test is the skills required to perform the job, not the skills the employees have.
- Effort is measured as the amount of physical or mental exertion needed to perform the job.
- Responsibility is the degree of accountability required for performing the job.
- Working Conditions include (a) physical surroundings and (b) hazards.
- Establishment confirms that discrimination applies only to jobs within an establishment. This is a distinct physical place of business.
Pay differences are permitted if they are based on seniority, merit, quantity or quality of production, or a factor other than sex.
If an employer reviews its pay practices and discovers a potential EPA violation, the employer may not reduce the higher paid employee’s compensation. Instead, the lower paid employee’s pay must be increased.
