Employers around the country need to comply with a growing patchwork of laws on fair pay, pay data reporting, and transparency in job ads and the hiring process. Compliance has become increasingly complex as more states and cities pass their own nuanced requirements that vary from location to location, and the stakes are getting higher as the penalties for violations rise. Here’s an overview of key federal, state, and local pay equity trends, as well as practical tips for compliance.
Quick Overview of Federal and State Equal Pay Laws
Purpose: The goal of pay equity and transparency laws is to close pay gaps and give employees more information to understand how their compensation compares to their peers and the market, and in turn, more power to correct past inequities based on gender, race, and other characteristics.
Themes: For over sixty years, the federal Equal Pay Act has required equal pay for men and women for substantially equal work. Many states have built on the federal law by, for example, extending protections beyond gender to cover race, age, and other protected characteristics. State laws may also limit the defenses employers can raise to justify pay differences and require those pay differentials to be job-related and consistent with business necessity. These differentials should be applied consistently across comparators and documented by the people making pay decisions.
Consequences: The...
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