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Where Are All the Women?
Pay and Promotion Inequity in Financial Services
by Wendi S. Lazar and Jennifer L. Liu1
Introduction
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paint a picture of how women’s struggle on Wall Street has evolved. As more women have
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of the law on gender discrimination, men today still control Wall Street, and the “glass ceiling”
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make significant headlines, class action lawsuits attract the public’s attention and make gender
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settlement a “'watershed in safeguarding and promoting the rights of women on Wall Street.”
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American stockbrokers alleged that Merrill Lynch’s “teaming” and “account distribution”
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district court denied the plaintiffs’ motion for class certification, relying in large part on 'XNHV
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on their face, but which have the effect of boosting men’s performance and handicapping
women’s. Notably, the court ordered Bank of America to produce comprehensive compensation
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States to the plaintiffs’ lawyers –DUDUHLQVWDQFHRIVHFUHWLYHLQIRUPDWLRQDERXWSD\DQGSD\
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,Q&KHQ2VWHUY*ROGPDQ6DFKV&R, female professionals in Goldman’s revenue
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IRFXVHVRQFRPSDQ\ZLGHSROLFLHVDQGSUDFWLFHVWKDWGLVadvantage women, such as Goldman’s
use of “360degree performance reviews” and ranking systems to evaluate performance and set
compensation, as well as the firm’s promotion practices. As with the Bank of America case, the
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Women Who Don’t Sue
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it’s expensive, and because a lawsuit is public, it could be careerHQGLQJ(YHQPDQ\RIWKRVH
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against a male supervisor or other “bad actor” or multiple bad actors is treading into career
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VKHLVOLNHO\WRVXIIHUSRRUSHUIRUPDQFHUHYLHZVQRSURPRWLRQUHGXFHGEXVLQHVVFRQWDFWVDQGRU
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industry. Unlike other industries, the traits that define success in finance are “macho” traLWVVXFK
DVZRUNLQJORQJKRXUVDQGPDNLQJWKHGHDODWDQ\FRVW.H\EXVLQHVVDFWLYLWLHVPL[IUHTXHQWO\
ZLWKVRFLDORQHVLQVWHUHRW\SLFDOO\PDOHORFDOHVVXFKDVEDUVDQGJROIFRXUVHVZKHUHZRPHQ
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The end result of women not participating in these events is to reward “macho” behavior—PDOH
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RUGHUWRVXFFHHG2UZRUVHVRPHWLPHVLWLs just another step in the company’s planned exit for
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“boom boom rooms,” bars, or golf courses. In fact, the women that do succeed become so
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Stanley, the firm ousted her from her President’s seat—QRWTXLHWO\OLNHPHQLQWKHSURIHVVLRQ
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JPMorgan Chase’s Heidi Miller and Bank of America’s Sallie Krawcheck are other notable
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QRWNHHSWKHPRQ:DOO6WUHHWPXFKOHVVKHOSWKHPJHWDKHDG
Family Responsibility Discrimination
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the 1980’s and 1990’s, most cases brought by women caregivers in financial services were
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protections have had some impact on protecting women caregivers, they don’t guarantee part
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industry need all the help they can get. While some banks have recently hired “specialists” to
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Conclusion
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LQGXVWU\DQGWKHPLVPDQDJHPHQWJUHHGDQGJRYHUQDQFHFULVHVRIWKHODVWILYH\HDUVWKHUHFHQW
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16
with clear development and leadership paths that don’t isolate WKHLUSDUWLFLSDQWV)LQDOO\VWDWH
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DQGSROLF\–female financiers in the 1990s bankrolled women’s issues like the proFKRLFH
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REPRINTED WITH PERMISSION
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(OL]DEHWK'ZRVNLQBook Review: “Wall Street Women,” by Melissa S. Fisher%/220%(5*%86,1(66:((.-XO
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17
18
8/30/2016
We Can Do It… But When?
The Riveting Struggle for Equal Pay
New York State Bar Association
Labor & Employment Law Section Fall Meeting
Washington, D.C. — September 23, 2016
Speakers
Moderator
Wendi S. Lazar
Outten & Golden LLP
New York, New York
Panelist
Zachary Fasman
Proskauer Rose LLP
New York, New York
Panelist
Francis H. Byrd
Byrd Governance Advisory
Brooklyn, New York
Panelist
Pamela Coukos
Workplace Equality Law
Washington, D.C.
19
8/30/2016
Overview
• What is the gender pay gap and where does
it come from?
• Legal Framework
• Common Allegations and Defenses
• Recent Coverage of the Issue
• Solutions
Quantifying the Gender Pay Gap
The pay gap
• Gradual improvement means that women
will not receive true parity until 2060
• The gap is broader for minority women
20
8/30/2016
Roots of the Gender Pay Gap
• Individual pay disparity stems from:
– Promotion and pay decisions
– Hiring and retention choices
– Workplace culture relating to work/life balance
• Differences in industry account for 51% of
the gender pay gap.
– The entry of women into male-dominated fields
results in lower pay.
– The reverse is true when jobs attract more men.
Roots of the Gender Pay Gap
21
8/30/2016
Roots of the Gender Pay Gap
The State of Corporate Diversity in 2016
• Percentage of Women (by race/ethnicity) on S&P
500 boards
Catalyst. 2014 S&P 500 Board Seats Held by Women by Race/Ethnicity. New York: Catalyst, March 17, 2015.
22
8/30/2016
The State of Corporate Diversity in 2016
Missing Pieces: Women and Minorities on Fortune 500 Boards—2012 Alliance for Board Diversity Census : “Reprinted with
permission from Catalyst, The Prout Group, The Executive Leadership Council, the Hispanic Association on Corporate Responsibility,
and Leadership Education for Asian Pacifics, Inc.” Published on August 15, 2013.
The State of Corporate Diversity in 2016
Missing Pieces: Women and Minorities on Fortune 500 Boards—2012 Alliance for Board Diversity Census : “Reprinted with
permission from Catalyst, The Prout Group, The Executive Leadership Council, the Hispanic Association on Corporate Responsibility,
and Leadership Education for Asian Pacifics, Inc.” Published on August 15, 2013.
23
8/30/2016
The State of Corporate Diversity in 2016
• Do Pay Gaps between white men, women and directors of
color persist even on corporate boards?
• Yes!?! According a research report released in July by
Professors Matthew Souther and Adam Yore from the
University of Missouri – “Racial and Gender Inequality in the
Boardroom”
• Findings: (1) Women and racial minority directors are less
likely to serve on key committees – especially audit and
compensation; (2) Women and minority directors are less
likely to serve in leadership positions on the board as lead
directors, non-executive chairs or committee chairs;
(3)Women and racial minority directors are more likely to be
undercompensated compared to white male directors
serving on the same board.
Legal Framework
(Federal)
• The Equal Pay Act of 1963
–
–
–
–
–
Gender-based difference in wages
Must show “equal work” as comparator
Comparator must be in the “same establishment”
No proof of intent required
Collective action mechanism (“opt-in”)
• Title VII of the Civil Rights Act of 1964
– Disparity based on any protected class
– Discrimination in all terms and conditions of employment, including
pay
– No comparator required
– Must either show discriminatory intent (disparate treatment) or
discriminatory effect (disparate impact)
– Class Action mechanism (“opt-out”)
24
8/30/2016
Legal Framework
(Federal continued)
• Bennet Amendment Affirmative Defenses
–
–
–
–
Seniority
Merit
Quantity or quality of production
Any factor other than sex
Legal Framework
(New York)
New York Equal Pay Act (amended in 2016)
• Originally, mirrored federal Equal Pay Act
• Expanded comparators in the “same establishment”
– Formerly: Same establishment required same office
– Now: Comparators can be anywhere within the county
• Narrowed definition of affirmative defense
– Formerly: “Factor other than sex”
– Now: Job-related
• Protects employees’ right to discuss and disclose
wages
• Allows for treble damages
25
8/30/2016
Legal Framework
(New York)
• New York State Human Rights Law
– Mirrors Title VII
• New York City Human Rights Law
– Applies to all protected classes
– Applies to all terms and conditions of
employment
– Requires a showing of discriminatory intent
(disparate treatment) or discriminatory effect
(disparate impact)
– More liberal standards than Title VII
Legal Framework
(Other States)
• California Fair Pay Act
– Gender-based disparity in wages
– No “same establishment” requirement for comparators
– Work must be “substantially similar” (not “equal”)
– Affirmative defense must be a bona fide factor other sex
with “an overriding legitimate business purpose”
– Cannot prohibit employees from discussing wages
• Massachusetts Act to Establish Pay Equity
– Employers cannot inquire into applicants’ previous
compensation
– No “factor other than sex” affirmative defense
– Cannot prohibit employees from discussing wages
26
8/30/2016
Executive Actions
• White House Equal Pay Task Force
• Policy: OFCCP and EEOC
– OFCCP Directive 307
– Pay Transparency Executive Order
– OFCCP Sex Discrimination Regulations
– Pay data collection under Presidential
Memorandum, OFCCP rulemaking, & EEOC
information collection (EEO-1)
• Public Engagement
– Research, reports & analysis of pay gap
– What House Equal Pay Pledge
Executive Actions
• Enforcement of Equal Pay for Equal Work
– EEOC v. Forrest City Grocery Co. (N.D. Miss.)
– OFCCP v. AstraZeneca (Dep’t of Lab. ALJ)
• Enforcement of Equal Access to Equal Work
– OFCCP v. G&K Services, Inc. (Dep’t of Lab.)
– EEOC v. Market Burgers LLC d.b.a. Checkers (E.D.
Pa.)
– OFCCP v. Ft. Myers Construction Corp. (Dep’t of
Lab.)
– EEOC v. Western Sugar Coop. (D. Colo.)
27
8/30/2016
Pressure for Change for Board Diversity
• Where is the pressure for corporate board
diversity coming from?
– U.S. Securities and Exchange Commission:
• Speech by Chair, Mary Jo White in November 2015 SEC.gov | Keynote Remarks at the Women's Forum of
New York Breakfast of Corporate Champions: "The
Pursuit of Gender Parity in the American Boardroom")
• Push for new disclosure requirements
– Congressional Democrats pressed for GAO
report last December 2015
http://www.gao.gov/products/GAO-16-30
Pressure for Change for Board Diversity
– Institutional Investors – Shareholder Proposals, Proxy
Votes, Private Engagement and SEC disclosure petition:
• Board Accountability Project NYC Pension Funds,
CalPERS, CalSTRS, CT State Treasurer CtW Investment
Group; Council of Institutional Investors (CII)
• Mega cap mutual funds: BlackRock, Vanguard, seek
answers during private engagements – some votes in
favor of diversity proposals
– Advocacy groups Thirty Percent Club (in the U.S.), 20/20
Women on Boards use of “name and shame game” and
push for legislation
28
8/30/2016
Common Allegations
• Providing lower pay or fewer benefits to
employees
• Steering or classifying employees or
applicants into lower paid positions
• Denying networking, mentoring or training
opportunities that facilitate promotion or
assignment to higher paid positions
• Assigning fewer hours to non-exempt
employees
Common Defenses
• Seniority, merit, and quantity/quality of
production (Lawful)
• Basing compensation decisions on prior pay
(Unlawful in Massachusetts)
• Providing higher compensation for lateral hires
(Potentially unlawful see Scott v. Family Dollar (W.D.N.C.
2016))
• Subjective performance review systems (Potentially
unlawful)
• Increase in pay only for those who negotiate
(Lawful)
• Higher pay for head of household (Unlawful in NY and
CA)
29
8/30/2016
Recent Developments
• Recent Equal Pay Act Litigation:
– EEOC v. Port Auth. of N.Y. & N.J., 768 F.3d 247 (2d Cir.
2014)
– Jaburek v. Foxx, 813 F.3d 626 (7th Cir. 2016)
– Steele v. Pelmor Labs., Inc., 642 F. App’x 129 (3d Cir.
2016)
– Carey v. Foley & Lardner LLP, 577 F. App’x 573 (6th Cir.
2014)
– Blackman v. Fla. Dep’t of Bus. & Prof’l Regulation, 599 F.
App’x 907 (11th Cir. 2015)
– Riser v. QEP Energy, 776 F.3d 1191 (10th Cir. 2015)
• Equal Pay in the news:
– U.S. Women’s National Soccer Team
– Inequities in Hollywood
– Pope Francis’s support of equal pay measures
Solutions
• Increasing transparency
– New laws promoting and requiring transparency
– Availability of compensation data from third
party sources (e.g. SEC filings, Comparably,
Glassdoor)
• Individual Efforts
– “Leaning in”
– Negotiating raises
– Male colleagues working as allies
• Quotas
30
8/30/2016
Best Practices
• Regular and robust internal assessments and
affirmative action programs
• Reporting and transparency mechanisms
• Identifying failure points
–
–
–
–
–
–
Entry level pay and placement
Negotiation and discretion
Opportunity distribution
Pay secrecy
Performance measurement and rewards
Excessive complexity
What To Expect for Board Diversity
in 2017 and Beyond
• More Shareholder Pressure (Proxy Access)
• More Research on Gender/Racial Diversity
• Post-election Fallout and a “new” SEC
• Is There Potential for Litigation by “discriminated”
women or minority directors against companies?
31
32
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Agenda
• State of Corporate Board Diversity in U.S.
• Is There Discrimination At The Board Level
In Pay and Committee Assignments? – Yes!?!
• Pressure for Change: SEC, Institutional
Investors, Diversity Advocates
• The Outlook for 2017 and Beyond
2
The State of Corporate Diversity
in 2016
• Percentage of Women (by race/ethnicity) on S&P 500
boards
Catalyst. 2014 S&P 500 Board Seats Held by Women by Race/Ethnicity. New York: Catalyst, March 17, 2015.
3
35
The State of Corporate Diversity
in 2016
Missing Pieces: Women and Minorities on Fortune 500 Boards—2012 Alliance for Board Diversity Census : “Reprinted
with permission from Catalyst, The Prout Group, The Executive Leadership Council, the Hispanic Association on
Corporate Responsibility, and Leadership Education for Asian Pacifics, Inc.” Published on August 15, 2013.
4
The State of Corporate Diversity
in 2016
Missing Pieces: Women and Minorities on Fortune 500 Boards—2012 Alliance for Board Diversity Census : “Reprinted
with permission from Catalyst, The Prout Group, The Executive Leadership Council, the Hispanic Association on
Corporate Responsibility, and Leadership Education for Asian Pacifics, Inc.” Published on August 15, 2013.
5
36
The State of Corporate Diversity
in 2016
• Do Pay Gaps between white men, women and directors of color persist
even on corporate boards?
• Yes!?! According a research report released in July by Professors
Matthew Souther and Adam Yore from the University of Missouri – “Racial
and Gender Inequality in the Boardroom”
• Findings: (1) Women and racial minority directors are less likely to serve
on key committees – especially audit and compensation; (2) Women and
minority directors are less likely to serve in leadership positions on the
board as lead directors, non-executive chairs or committee chairs;
(3)Women and racial minority directors are more likely to be
undercompensated compared to white male directors serving on the
same board.
6
Pressure for Change
• Where is the pressure for corporate board diversity coming from?
î U.S. Securities and Exchange Commission:
• Speech by Chair, Mary Jo White in November 2015 - SEC.gov | Keynote Remarks at
the Women's Forum of New York Breakfast of Corporate Champions: "The Pursuit of
Gender Parity in the American Boardroom")
• Push for new disclosure requirements
î Congressional Democrats pressed for GAO report last December 2015
http://www.gao.gov/products/GAO-16-30
î Institutional Investors – Shareholder Proposals, Proxy Votes, Private
Engagement and SEC disclosure petition:
• Board Accountability Project NYC Pension Funds, CalPERS, CalSTRS, CT State
Treasurer CtW Investment Group; Council of Institutional Investors (CII)
• Mega cap mutual funds: BlackRock, Vanguard, seek answers during private
engagements – some votes in favor of diversity proposals
î Advocacy groups Thirty Percent Club (in the U.S.), 20/20 Women on
Boards use of “name and shame game” and push for legislation
7
37
What To Expect in 2017 and
Beyond
• More Shareholder Pressure (Proxy Access)
• More Research on Gender/Racial Diversity
• Post-election Fallout and a “new” SEC
• Is There Potential for Litigation by
“discriminated” women or minority directors
against companies?
8
Research/Resources
•
Missing Pieces: Women and Minorities on Fortune 500 Boards—2012 Alliance for
Board Diversity Census “Reprinted with permission from Catalyst,The Prout Group,
The Executive Leadership Council, the Hispanic Association on Corporate
Responsibility, and Leadership Education for Asian Pacifics, Inc.” Published on
August 15, 2013.
•
Racial and Gender Inequality in the Boardroom, Matthew E. Souther and Adam S.
Yore. Published July 2016 Electronic copy available at:
http://ssrn.com/abstract=2810543
•
The SEC Wants New Rules For Board Diversity—Here's Why That Matters by Molly
Petrilla, January 29, 2016 http://fortune.com/2016/01/29/sec-rules-boarddiversity/
•
United States Government Accountability Office, Corporate Boards, Strategies to
Address Representation of Women Include Federal Disclosure Requirements,
December 2015 http://www.gao.gov/assets/680/674008.pdf
•
20/20 Women on Boards https://www.2020wob.com/
9
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Pay Transparency and New Disclosure
and Reporting Initiatives
Since President Obama began his tenure by signing the Lilly Ledbetter Fair Pay Act,1 a broader
legal, policy and cultural transformation has moved the gender pay gap from a niche issue to an
increasingly prominent public concern. At the same time, changes in the workplace and increased
government, stakeholder and business attention have taken approaches that once seemed radical and
turned them into achievable interventions. Notably, reporting and transparency are becoming more
accepted initiatives – and they are approaches that align with the best current thinking on effective
workplace diversity practices. The movement toward greater pay transparency and increased disclosure
and reporting ranges from legal restrictions on punitive pay secrecy policies to empowering workers to
know their worth to voluntary disclosures by employers to new proposed reporting requirements.
Taken together these initiatives promise to transform existing expectations about access to wage
information.
Legal Limitations on Pay Secrecy Policies and Practices
Traditionally, many employers sought to limit the ability of workers to share information
through formal pay secrecy policies or by enforcing informal norms or practices. One well-regarded
survey found in 2010 that about half of all employees report they are formally barred or discouraged
from discussing or disclosing information about their pay, with an even greater proportion of private
sector employees indicating that pay information at their workplace Is secret.2 In addition, cultural
1
P.L. 111-2 (2009).
Ariane Hegewisch, et al, Pay Secrecy and Wage Discrimination, Institute for Women’s Policy Research (2011),
http://www.iwpr.org/publications/pubs/pay-secrecy-and-wage-discrimination.
2
79
expectations can prevent individuals from asking about or disclosing their pay even where there is no
explicit workplace restriction. Pay secrecy policies and practices not only make it harder for employees
to identify or challenge unfair pay practices, they can have other negative impacts on workers and
employers, such as harming performance, morale, and retention.3
Pay secrecy policies have flourished despite significant question as to their legality. Prior to
2015, California, Colorado, DC, Illinois, Louisiana, Maine, Michigan, Minnesota, New Hampshire, New
Jersey, and Vermont had some form of pay secrecy restriction.4 And just since 2015, new laws passed
in Connecticut, Delaware, Massachusetts New York, and Oregon have significantly expanded state law
protections. Generally, these laws provide certain exceptions or exclusions, for example, where
employees have broad access to salary records as part of their work responsibilities. Federal law has
also limited pay secrecy for some time. The National Labor Relations Board has established in a series of
rulings that employer pay secrecy policies or practices can violate the National Labor Relations Act. The
NLRB decisions protect the right of non-supervisory workers to share information about wages as a
necessary instrument of collective action.5 In light of these existing legal mandates, it should be very
difficult to sustain formal policies against discussing wages. However, limited enforcement and
knowledge has blunted their impact.6
3
OFCCP Pay Transparency Final Rule, infra note 7 (citing studies).
State law information compiled from Department of Labor Women’s Bureau resources at
https://www.dol.gov/wb/media/WB_PaySecrecy_FactSheet_508.pdf and
https://www.dol.gov/wb/equalpay/equalpaymap.htm and more recent news accounts.
5
See, e.g., National Labor Relations Board Decision and Order, T-Mobile USA, Inc., Case No. 28-CA-106758 (2016),
https://www.nlrb.gov/case/28-CA-106758; National Labor Relations Board v. Main Street Terrace Care Center, 216 F.3d 531
(6th Cir. 2000).
6
Tom Driesbach, Pay Secrecy Policies at Work: Often Illegal, and Misunderstood, NPR (April 13, 2014),
http://www.npr.org/2014/04/13/301989789/pay-secrecy-policies-at-work-often-illegal-and-misunderstood; The Law That Is
Supposed to Protect Your Right To Talk About Pay Doesn’t Actually Work, Think Progress (March 25, 2015),
https://thinkprogress.org/the-law-that-is-supposed-to-protect-your-right-to-talk-about-pay-doesnt-actually-workf3b20c90396d#.aznut44ra.
4
80
The recent uptick in new state laws and a new federal Executive Order have now focused greater
attention on this issue and upended many assumptions about worker rights to ask about, discuss or
disclose their pay information. In 2015, the U.S. Department of Labor’s Office of Federal Contract
Compliance Programs adopted new regulations for companies that do business with the federal
government, to implement President Obama’s Executive Order 13665 signed in 2014. These rules state
that employees of and applicants to covered federal contractors are legally permitted to talk about
their pay, and ask about the pay of others, without fear of reprisal, and subject to some limited
defenses.7
Workers and Employers Taking Initiative on Pay Transparency
Regardless of the scope of legal protections, social, cultural and technological changes have
made pay transparency an increasing reality on the ground. Workers are now using websites like
Glassdoor or Payscale to share pay information. Those sites have produced new datasets and research
that are expanding our understanding of the pay gap and its dynamics. 8 A few private employers have
implemented full pay transparency, a framework public employers have already adapted to.9
At the same time, investor pressure, 10 union engagement11 and high profile hacks and leaks12
have begun to open the conversation about internal pay equity studies to the public. A few major
7
U.S. Department of Labor Office of Federal Contract Compliance Programs, Government Contractors Prohibitions Against
Pay Secrecy Policies and Actions, Final Rule, 80 FR 54934 (Sept. 11, 2015), available at https://www.gpo.gov/fdsys/pkg/FR2015-09-11/pdf/2015-22547.pdf;
ͺAndrew Chamberlain, Demystifying the Gender Pay Gap, Evidence from Glassdoor Salary Data, Glassdoor.com (March 23,
2016), https://www.glassdoor.com/research/studies/gender-pay-gap/.
9
Erica Morphy, Jet.com Is Making Its Employees’ Salaries Transparent and Non-Negotiable, Forbes (July 21, 2015); Alison
Griswold, Here’s Why Whole Foods Lets Employees Look Up Each Others’ Salaries, Business Insider (March 3, 2014).
10
Lisa Hayles, Boston Common Asset Management Comment to U.S. EEOC on Proposed Revision of the Employer
Information (EEO-1) Report to Include Collection of Pay Data, available at https://www.regulations.gov/document?D=EEOC2016-0002-0240; Susan Baker and Brianna Murphy, Trillium Asset Management Comment to U.S. EEOC on Proposed
Revision of the Employer Information (EEO-1) Report to Include Collection of Pay Data, available at
http://www.trilliuminvest.com/wp-content/uploads/2016/03/EEOC-Comment-Letter-3.9.16.pdf; Katie Johnson, She’s
Pressing Top Companies on Pay Equity, Boston Globe (May 21, 2016), available at
81
employers have taken the previously unprecedented step of publicly disclosing their pay equity audits –
with Amazon, Microsoft, Salesforce and the Gap publishing their findings and plans on company
websites or putting them in public press releases.13 This follows other disclosures from tech employers
such as Apple, Cisco and Google who voluntarily released their EEO-1 data, along with broader
publication of their diversity data and measures.14
Even more companies have made new voluntary commitments to incorporate regular pay equity
audits into their business practices. For example, over the last several years, at least 100 employers
have joined the Boston Women’s Compact. The Compact requires companies signing on to address the
gender pay gap through self-assessment and other best practices.15 In June of 2016 the White House
asked major companies to sign a pledge that they would make pay equity studies standard operating
procedure – and twenty-eight have now agreed to make that commitment. The “Equal Pay Pledge,”
states that signatories will conduct regular, companywide pay equity audits that include an assessment
of pay differences across occupations and the potential impact of hiring, promotion and other practices
on gender pay equity.16
https://www.bostonglobe.com/business/2016/05/20/she-pressing-top-companies-payequity/tA0XUQep7QCRGj6NTG82pL/story.html.
11
Alexander C. Kaufman and Emily Peck, Wall Street Journal Vows to Fix Pay Gap for Women and Minorities, Huffington Post
(March 24, 2016), http://www.huffingtonpost.com/entry/wall-street-journal-pay-gap_us_56f44629e4b0143a9b47bc4d.
12
Libby Copeland, Sony Pictures Hack Reveals Stark Gender Pay Gap, Slate (Dec. 5, 2014),
http://www.slate.com/blogs/xx_factor/2014/12/05/sony_pictures_hack_reveals_gender_pay_gap_at_the_entertainment_c
ompany_and.html.
13
Diversity at Amazon, https://www.amazon.com/b/ref=tb_surl_diversity/?node=10080092011); Salesforce, Equality at
Salesforce: The Equal Pay Assessment Update (March 8. 2016), available at
https://www.salesforce.com/blog/2016/03/equality-at-salesforce-equal-pay.html; Cora Lewis, These Companies are
Eliminating Their Gender Pay Gaps, Buzzfeed (March 14, 2016), available at
https://www.buzzfeed.com/coralewis/companies-are-eliminating-their-gender-paygaps?utm_term=.ek1l5WEXv#.nkGVy6reK.
14
http://opendiversitydata.org/.
15
City of Boston, Boston Women’s Compact, http://www.cityofboston.gov/women/workforce/compact.asp.
16
White House Equal Pay Pledge, available at https://www.whitehouse.gov/webform/white-house-equal-pay-pledge; White
House Fact Sheet: Government, Businesses and Organizations Announce $50 Million in Commitments to Support Women and
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New Proposed Reporting Requirements
Finally, over the last several years, federal agencies have been considering options to require
employers to report summary pay data for enforcement purposes. OFCCP has been engaged in a
rulemaking process that would require federal contractors to provide summary pay data -- beginning
with a process for gathering input in 2011 and a proposed rule published in 2014.17 That process has
now merged with an EEOC proposal to expand the current EEO-1 form to collect pay as well as
representation information.18
The EEOC’s rulemaking is not yet complete, but the proposal would require employers with 100
or more employees to provide summary information based on W-2 wage data by gender and
race/ethnicity using the 10 EEO-1 occupational categories. Rather than specific pay amounts, the EEOC
proposes reporting the number of workers within pay bands, as well as total hours worked. The agency
anticipates beginning pay data collection with 2017 data to be reported by March of 2018.
Benefits of Voluntary Self-Analysis, Disclosure and Reporting
Although existing laws and regulations either require companies to implement regular pay
equity analysis, or create strong risk management incentives to do so, progress remains uneven.19 This
makes the recent increase in voluntary self-analysis and stakeholder engagement particularly
significant. And a new federal data collection requirement should further increase the amount and
Girls (June 13, 2016), available at https://www.whitehouse.gov/the-press-office/2016/06/13/fact-sheet-governmentbusinesses-and-organizations-announce-50-million.
17
See Office of Federal Contract Compliance Programs, Notice of Proposed Rule Making, Government Contractors,
Requirement to Report Summary Data on Employee Compensation, 79 F.R. 46562 (2014).
18
81 F.R. 45479, Agency/Docket Number 3046-007, Document Number 2016-16692,
https://www.federalregister.gov/articles/2016/07/14/2016-16692/agency-information-collection-activities-notice-ofsubmission-for-omb-review-final-comment-request.
19
Covered federal contractors must include regular self-analysis of compensation by race and gender as part of their EEO
programs, see 41 C.F.R. §60-2.17, and all employers are potentially subject to public or private enforcement actions under
federal or state laws banning pay discrimination.
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quality of internal pay equity audits, by ensuring employers will review their data annually when
compiling the report.
Measurement, transparency and accountability appear to be more effective than other kinds of
common approaches to improving diversity and EEO outcomes generally.20 Measuring and reporting on
progress can help interrupt common biases and in-group favoritism by making outcomes more visible.21
Collecting data and reviewing results seems to be particularly salient.22 Research on federal contractors
has identified a relationship between affirmative action programs -- which require companies to
establish written plans, review data, set goals and monitor progress -- and progress in the workplace for
women and workers of color.23 These findings suggest that the movement toward greater disclosure,
increased reporting and more transparency is an important intervention in addressing the pay gap.
20
Frank Dobbin, Alexandra Kalev and Erin Kelly, Best Practices or Best Guesses? Assessing the Efficacy of Corporate
Affirmative Action and Diversity Policies, American Sociological Review (2006); Iris Bohnet, What Works: Gender Equality by
Design (2016); Michele E. A. Jayne and Robert L. Dipboye, Leveraging Diversity to Improve Business Performance: Research
Findings and Recommendations for Organizations, Human Resource Management (Winter 2004); Frank Dobbin and
Alexandra Kalev, Why Diversity Programs Fail, And What Works Better, Harvard Business Review (July-August 2016).
21
Barbara Reskin, The Proximate Cause of Employment Discrimination, Contemporary Sociology (2000); Christine Jolls and
Cass Sunstein, Debiasing Through Law, Journal of Legal Studies (2006); Joel Nadler, et al, Aversive Discrimination in
Employment Interviews: Reducing Effects of Sexual Orientation Bias with Accountability, Psychology of Sexual Orientation
and Gender Diversity (2014).
22
Bohnet (2016); Dobbin & Kalev (2016), supra note 20.
23
See, e.g., Fidan Ana Kurtulus, Affirmative Action and the Occupational Advancement of Women and Minorities 1973-2003,
Industrial Relations (2012); Jonathan S. Leonard, The Impact of Affirmative Action on Employment, Journal of Labor
Economics (1984).
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Coukos / Working IDEAL Sept. 23, 2016
Unequal Payday
Pamela Coukos (April 12, 2016)
Originally published on the Working Toward Equality Blog available at
https://workingtowardequality.wordpress.com/2016/04/12/unequal-payday/.
It’s Equal Pay Day1 — except that it’s not. It’s a funny idea in the first place, naming a special day to
recognize the systematic shortchanging of the wages of more than half the population in the same way
we might celebrate a famous person, place or event. More importantly, there is not really some specific
point in the calendar when women “catch up” to what men have earned in the year before. When you
look at the big picture, you can’t pick a single day when women are at parity with men. It’s always some
kind of unequal payday.
If women on average earn somewhere around 79 percent of what men make in a year, at that rate it
would take between 15 and 16 months for a typical women working full time to equal what a
comparable man makes in just 12. If she’s African-American or Latina, her months are more likely to
stretch out well beyond 162; but women of all races might need to work more days than the average, or
a bit less. Because it also depends on where she lives3, her age and her occupation.4 On whether she’s
a mother,5 whether she has a college degree, whether she works full time. There’s an endless debate,
often more myth than fact,6 about exactly how many cents women lose on the dollar, and whether if
you try really, really hard to narrow it down you can get it to single digits.7 (At the end of the day,
there’s always a gap.)8 And then what? To paraphrase one of my favorite quotes on this point, splitting
the pennies into two piles — one stack called discrimination and the other called life choices — “just
isn’t very satisfying.”9
Equal Pay Day is intended to smooth over these complications with simple and accessible symbolism.
The calendar shows how much longer and harder she works for the money, in this case a year’s worth
of male earnings. Maybe it’s not exactly 102 days into the next calendar year, but that really isn’t the
point. The point is we still have a problem and Equal Pay Day is a startling reminder that we are not
equal, not yet.
85
***
We need to get beyond only caring about — and only talking about — “equal pay for equal work.”
Paying women less for “substantially equal” work has been illegal under the Equal Pay Act for more
than fifty years. And it’s wrong, and it is still a problem.10 But denying women equal access to equal
work has also been illegal for more than fifty years under Title VII of the Civil Rights Act of 1964 and
other state and federal laws. In other words, you can’t limit women’s access to higher paying jobs and
then justify their wage gap as just an unfortunate accident of that difference in job duties. This is doubly
true when ideas about what women “can” or “should” do skew who gets hired to do what.
Think that doesn’t happen? Tell it to the women shunted into the bakery instead of a higher paying area
of the grocery store,11 the female laundry workers assigned to sort and fold clothes instead of loading
the washers like the men for a higher hourly rate,12 the women placed at the cashier station instead of
valet parking the cars and getting tip money.13 And if women just happen to get fewer work hours on
the construction site, less valuable clients and fewer sales leads,14 or fewer promotional
opportunities then they get paid less too.15 If we limit ourselves to the problem of equal pay for equal
work we may miss a lot of unequal paydays.
That also means everything we think we know about whether differences in jobs, or in work hours, or
experience “explains” enough of the pay gap comes with a giant asterisk. Overt discrimination as well
as other barriers to equality of opportunity challenge the assumption that these are simply different
“life choices” we can drop into the analysis without question. As I wrote several years back, “even the
‘explained’ differences between men and women might be more complicated. . . . If high school girls are
discouraged from taking the math and science classes that lead to high-paying STEM jobs, shouldn’t we
in some way count that as a lost equal earnings opportunity?”16
Certainly it’s impossible to sum up the big, sprawling social inequality of how gender (and race, and
disability, and sexual orientation) distort fair earnings by just picking a single point in the calendar and
calling it a draw. And yet sometimes we benefit from a useful and imprecise shorthand for
86
understanding a much more complex phenomenon. Happy Unequal Payday everyone; only 43 more
years until we finally catch up.17
1
National Committee on Pay Equity, http://www.pay-equity.org/day.html.
Bryce Covert and Dylan Petrohilos, The Gender Wage Gap is a Chasm for Women of Color, In One Chart, Think Progress
(Sept. 18. 2014), http://thinkprogress.org/economy/2014/09/18/3569328/gender-wage-gap-race/.
3
Sebastien Malo, Rural U.S. States Have Biggest Gender Pay Gaps, Report Shows, Reuters (April 8, 2016),
http://www.reuters.com/article/us-usa-women-pay-idUSKCN0X52H8.
4
Ariane Hegewisch and Asha DuMontheir, The Gender Wage Gap by Occupation 2015 and By Race and Ethnicity, Institute
for Women’s Policy Research (April 2016), http://www.iwpr.org/publications/pubs/the-gender-wage-gap-by-occupation2015-and-by-race-and-ethnicity.
5
Shelley J. Correll, et al, Getting a Job: Is There a Motherhood Penalty? American Journal of Sociology (March 2007),
http://gender.stanford.edu/sites/default/files/motherhoodpenalty.pdf.
6
Pamela Coukos, 50 Down, 50 to Go: Mythbusting the Pay Gap Revisited, U.S. Department of Labor Blog (June 7, 2013),
http://blog.dol.gov/2013/06/07/50-down-50-to-go-myth-busting-the-pay-gap-revisited/.
7
Andrew Chamberlain, Demystifying the Gender Pay Gap, Evidence from Glassdoor Salary Data, Glassdoor.com (March 23,
2016), https://www.glassdoor.com/research/studies/gender-pay-gap/.
8
Pamela Coukos, Mythbusting the Pay Gap, U.S. Department of Labor Blog (June 7, 2012),
http://blog.dol.gov/2012/06/07/myth-busting-the-pay-gap/.
9
Matthew Yglesias, Does Gender Discrimination Cost Women 23 Cents on the Dollar Or “Only” 9? It’s Both! Slate Moneybox
(June 5, 2012),
http://www.slate.com/blogs/moneybox/2012/06/05/gender_discrimination_does_it_cost_women_23_centson_the_dollar_
or_only_9_.html.
10
https://www.eeoc.gov/eeoc/publications/fs-epa.cfm.
11
Allen R. Meyerson, Supermarket Chain to Pay $81 Million to Settle A Bias Suit, New York Times (Jan. 25, 1997),
http://www.nytimes.com/1997/01/25/business/supermarket-chain-to-pay-81-million-to-settle-a-bias-suit.html.
12
U.S. Department of Labor, G&K Services Co. Settles Claims of Pay and Hiring Discrimination with U.S. Labor Department,
News Release (Nov. 4, 2013), http://www.dol.gov/newsroom/releases/ofccp/ofccp20131725.
13
U.S. Department of Labor, Central Parking System of Louisiana Settles Hiring and Pay Discrimination Case with U.S.
Department of Labor, News Release (Sept. 4, 2014), https://www.dol.gov/opa/media/press/ofccp/OFCCP20140920.htm.
14
Patrick McGeehan, Bank of America to Pay $39 Million in Gender Bias Case. New York Times (Sept. 6, 2013),
http://dealbook.nytimes.com/2013/09/06/bank-of-america-to-pay-39-million-in-gender-bias-case/.
15
Bob Van Voris, Novartis Reaches $152.5 Million Sex-Bias Settlement, Washington Post (July 14, 2010),
http://www.washingtonpost.com/wp-dyn/content/article/2010/07/14/AR2010071405346.html.
16
Coukos, supra note 8.
17
Laura Bates, Women Can’t Wait Until 2059 for Equal Pay, Time Magazine (April 11, 2016),
http://time.com/4286884/women-cant-wait-for-equal-pay/.
2
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