Fifty years ago yesterday John F. Kennedy signed the Equal Pay Act into law.  Even with that much time to eradicate unfair pay between men and women, many still believe a gap exists.  Stories from the Huffington Post, the Washington Post, and NPR, all cite a 2010 Census Bureau Report that women earn just 77 cents for every dollar earned by men.  More specifically, the median salary earned by men was 23% higher than that earned by women.

According to a January 2009 Report prepared for the US Department of Labor, however, the difference is just 20.4% between the sexes and several factors account for most of that gap.  These include:

  • A greater percentage of women than men tend to work part-time.  Part-time work tends to pay less than full-time work.
  • A greater percentage of women than men tend to leave the labor force for child birth, child care and elder care.  Some of the wage gap is explained by the percentage of women who were not in the labor force during previous years, the age of women, and the number of children in the home.
  • Women, especially working mothers, tend to value “family friendly” workplace policies more than men.  Some of the wage gap is explained by industry and occupation, particularly,the percentage of women who work in the industry and occupation.

The research also suggests that differences not incorporated into the 2009 Report may account for part of the remaining gap.  The 2009 Report focuses on wages rather than total compensation. Other research indicates that women may value non-wage benefits more than men do, and as a result prefer to take a greater portion of their compensation in the form of health insurance and other fringe benefits.

Regardless of your point of view, several in Congress do not believe the Equal Pay Act has done enough.  They have been advocating for the passage of a Paycheck Fairness Act since 2005 when Hillary Clinton first offered the legislation for consideration.  Senator Kristen Gillibrand, D-NY appeared yesterday on CBS News to advocate for the 2013 version of the proposed law.

The proposed Paycheck Fairness Act modifies the existing language of the Equal Pay Act to curtail one of the exemptions for disparate pay between men and women.  Rather than having a reason “other than sex” which will be acceptable to a court, the new act proposes that employers must have a “bona fide reason other than sex such as education, training, or experience.”  This new language is perceived to be more stringent.

Additionally, the Paycheck Fairness Act proposes more significant penalties for employers who violate the law and training for women in how to negotiate wages better.  According to Senator Gillibrand in her CBS interview, just 7% of women will attempt to negotiate a higher salary when offered a new position as opposed to 55% of men.

It will be interesting to see if the 2013 version of the law is passed.  Each edition proposed since 2005 has died on the vine.