Several significant employment or labor law trends are seeing action at both the federal and state level; legislation is being proposed on pay equity, overtime compensation, and minimum wage standards.
This issue has seen conflict and poor resolution since gender-based pay disparities were first noted and challenged in the courts. The Equal Pay Act of 1963 was a first step, but it left a number of loopholes for pay disparities. In addition, there were few avenues for legal redress for those who challenged their employers over pay discrimination. In 2009, the Lilly Ledbetter Fair Pay Act closed one of these loopholes, allowing better access to legal redress for victims of pay equity discrimination. This year, the Paycheck Fairness Act is before the Senate and House of Representatives (S 819 HR 1869). This bill seeks to amend the Fair Labor Standards Act. It will provide for more standardization in hiring and initial salaries, and more effective methods of remediation for discrimination.
How are we still having problems, when an equal pay law has been on the books since 1963? Standards for interviewing, and using salary history for starting salaries, is part of the continuing problem. Up until the present day, job interviews included questions about salary history and expectations for starting salary. This allowed employers to continue a pattern of historical discrimination. Many state legislatures are reviewing bills this session to restrict or remove these types of interview questions, and to force standards for education and experience in starting salaries, irrespective of gender or prior personal salary history of an applicant.
The Glass Ceiling
There are more subtle issues as well regarding women’s inability to rise in the workplace. Some of the issues related to pay disparity are also issues of lack of promotion opportunities; or slower promotion and fewer opportunities for women. Many women take leave for childbirth and child-rearing; they then find that their absence impacts their promotion and opportunities for many years after. These more complex challenges to gender disparities in the workplace will work themselves out in businesses and the courts in the years to come.
The current labor laws under consideration address gender based pay disparities. However, other types of pay disparity are also present in American workplaces.
The last proposal to increase base salary for an employee to receive overtime compensation under the Fair Labor Standards Act was struck down by a judge in Texas. The current proposal is more modest, in the hope that business leaders will not challenge the change as vigorously. The proposal, which is in the public comment stage, raises the base salary from $23,660 to $35,308 annually. Those who make $35,308 annually or less are entitled to overtime compensation as money in addition to their salary. Those who make more are entitled to other forms of compensation. In addition, various types of compensation for highly compensated workers- those with high salaries- is discussed.
Minimum wage legislation remains challenging at both the state and federal levels. State legislatures across the country are again wrestling with options. In the House of Representatives, the new minimum wage bill has recently passed committee, and will be coming up for a vote within a few weeks. This bill will raise the federal minimum wage from $7.25 to $15.00 by 2024 in increments. There are also new standards for tipped workers and younger workers.
Ohio raised their minimum wage on January first from $8.30 to $8.55.
Overall, Ohio is considered to have better protections for workers than federal standards. In both discrimination protection and health care continuation, for instance, Ohio’s standards are more stringent than the federal governments. Businesses who work across state lines have more challenges when standards for pay equity, overtime, minimum wage, and other employment standards differ than those in the state of origin.
Have you experienced an issue in your workplace that you believe violated federal or state employment/labor law, or are you a business that is experiencing challenges in these areas? We can offer advice and suggestions for next steps. Please contact us for more information.