Obama Renews Call For Paycheck Fairness Act

by Hans Bader on February 13, 2013 · 2 comments

in Economy, Employment, Labor, Legal, Regulation

In his State of the Union address last night, President Obama renewed his call for passage of the Paycheck Fairness Act, which would make it harder for employers to rely on certain merit-based factors “other than sex” in setting employee pay. Two federal laws, the Equal Pay Act, and Title VII of the 1964 Civil Rights Act, already ban gender-based pay discrimination. Appealing to low-information voters who may not be aware of these laws, Obama declared, “I ask this Congress to declare that women should earn a living equal to their efforts, and finally pass the Paycheck Fairness Act this year.” The administration’s back-up document for this statement asserted that ‘on average women generally make 23 cents on the dollar less than men.’” But that figure is misleading, because women generally aren’t paid less for the same job, or working the same number of hours.

As The Washington Post‘s Glenn Kessler notes, government data shows women work fewer hours than men, which explains much of the apparent pay gap: “since women in general work fewer hours than men in a year, the statistics used by the White House may be less reliable for examining the key focus of the legislation — wage discrimination.” I discuss some other unfounded claims made in support of the Paycheck Fairness Act at this link.

As Steve Tobak noted at CBS News,

Men are far more likely to choose careers that are more dangerous, so they naturally pay more. Top 10 most dangerous jobs (from the U.S. Bureau of Labor Statistics): Fishers, loggers, aircraft pilots, farmers and ranchers, roofers, iron and steel workers, refuse and recyclable material collectors, industrial machinery installation and repair, truck drivers, construction laborers. They’re all male-dominated jobs. . .Men are far more likely to take work in uncomfortable, isolated and undesirable locations that pay more. Men work longer hours than women do. The average fulltime working man works six hours per week or 15 percent longer than the average fulltime working woman.

According to the federal Bureau of Labor Statistics, 92 percent of all workers who die on the job are men, even though only a bare majority of all workers are men. These examples are at odds with the assumption of many supporters of the Paycheck Fairness Act and the Ledbetter Act that pay disparities are simply the result of gender bias or sexism.

The Society for Human Resource Management contends the Paycheck Fairness Act “would effectively prohibit employers from using many legitimate factors to compensate their employees, including professional experience, education, training, employer need, local labor market rates, hazard pay, shift differentials and the profitability of the organization.”

When I first got married, my wife worked shorter hours than me and used her additional time outside the workplace for activities such as grocery shopping and preparing dinner. So there was nothing unfair about the fact that her employer paid her less than I was paid. I was getting the benefit of  these activities, not her employer — a benefit reflected in the fact I paid most of the rent.

My situation was not unusual. On average, women work fewer hours than men, and are paid less, although women’s purchases apparently account for most of the nation’s consumer spending, and women probably consume as much as men. As Ramesh Ponnuru notes at Bloomberg News, although “women earn an average of 77 cents on a man’s dollar,” “part of the gap reflects the fact that women, on average, work fewer hours than men. Among people who work 40 hours a week, according to the Labor Department, women make 87 percent of what men do.” Economist Diana Furchtgott-Roth cites a 2005 study . . . which found that . . . ‘There is no gender gap in wages among men and women with similar family roles.’ In addition to being more likely to seek part-time work, women are also more likely to have gaps in their employment history and to enter lower-paying fields. . . a 2009 report for the Labor Department, found that these factors account for most of the pay gap.”

As Ponnuru points out, it makes no sense to blame employers for this, since “there is very little that individual employers can do about any of these issues. They can’t make men do more housework, or pick majors for women. Nor can they reasonably be asked to adjust their salary schedules to make up for those choices.”

Instead, it’s up to households to compensate women for the greater work they do on average around the house, since it is households, not employers, who reap the benefits of this household labor. Households appear to do just that, since women spend much of the nation’s income, and account for most consumer purchases.

Misconceptions about the wage gap between men and women are driving support for the Paycheck Fairness Act, which would require equal pay for unequal work in some cases. In 2009, an unnecessary law called the Lilly Ledbetter Fair Pay Act was enacted based on false claims about the facts and ruling contained in a Supreme Court decision dealing with pay discrimination (the Ledbetter Act altered the statute of limitations under one of the existing laws banning pay discrimination, Title VII of the Civil Rights Act of 1964).

As former House Speaker Nancy Pelosi (D-Calif.), a supporter of the Paycheck Fairness Act, noted, under the Equal Pay Act that is currently in force, “Courts have allowed employers to use any factor other than sex to justify a pay disparity between men and women.” By contrast, she said, “Under the Paycheck Fairness Act, an employer would have to show that the disparity . . . is job-related, and is consistent with business necessity.” So the fact an employer relied on a “factor other than sex” to set pay would not necessarily be a defense, and an employer could be held liable even if it was perfectly fair in how it paid its workers.

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