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Handling the Arguments Against Pay Equity
Following
are common claims that have been used
in opposition
to the concept of pay equity
and responses to those
arguments.
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1.
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GENERAL CLAIMS ABOUT THE WAGE GAP
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Claim:
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The wage gap is a myth. Using the
77¢ figure is misleading because it does not take
into account human capital differences such as education
and experience.
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Response:
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The
Census Bureau reports that the median annual earnings
of year-round, full-time working women are 77% of the
median annual earnings of year-round, full-time, working
men. For women of color, the median earnings numbers are
more severe. African American women earn 68% of every dollar earned
by white men, and Latinas earn 57%.
Economists do disagree about the
extent to which the wage gap reflects labor market discrimination
or other human capital factors such as differences among
workers in education and experience. Recent studies
show that between one-quarter and one-half of the gender
wage gap remains unexplained even after taking such
human capital differences into account.
The Census Bureau's annual earnings
ratios are an important indicator for tracking trends
over time. When the Equal Pay Act was passed in 1963,
women earned 59 cents on the dollar compared to men.
In 2004, that figure was 77¢ on the dollar. The
wage gap has changed at a rate of less than a half a
penny per year.
While earnings statistics don't
tell the whole story, they are important indicators
of the progress we have made in wage parity and in economic
opportunity -- such as
ensuring there are fair opportunities to earn more.
Economists do agree that discrimination can play a part
in determining differences in experience, job tenure,
and other "explainable" factors.
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Claim:
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When looking at hourly earnings,
women make 83% of men's earnings, even before accounting
for differences in education, experience, and occupation.
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It
is important to keep in mind that hourly earnings are
also subject to critique. The Bureau of Labor Statistics
reports hourly earnings for those occupations in which
people earn an hourly wage (only about 72 million workers,
or roughly half of the labor force). Thus, the figure
is not representative of all workers. |
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Claim:
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Some
research finds that in a few specific instances, women
and men are paid the same for equal jobs. For example,
women age 35-44 with psychology degrees working as social
scientists earn 101 percent as much as their male equivalents,
and women in this age group with engineering degrees working
as engineers earn 95% as much as their male counterparts. |
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Response:
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These
examples leave out the majority of workers. While it is
encouraging to find that small numbers of women have been
successful in overcoming discrimination, these studies
do not reflect the opportunities that most women have.
Should women simply avoid growing any older than age 44?
Should we all enter the psychology and engineering fields?
While wage statistics tell only
part of the story, it is important to get a large cross
section of statistics when evaluating this issue. There
are plenty of salary surveys that control for age, experience,
time in the workforce, and other factors and still find
unexplained wage gaps. For example, The Industry
Standard recently reported the results of the Internet
Workforce Compensation Study 2000, in which they found
a gap even when education, position, and industry sector
are factored in.
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Claim:
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The
wage gap is partially explained by women leaving the workforce
to rear small children or to care for other family members.
In that sense, they do not invest as much in their human
capital as men do, so they are less valuable to a company.
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Response:
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It
is true that some women choose to take time out of the
workforce to care for their loved ones. We believe that
this is a legitimate choice for women and men to make.
However, the majority of women do not make this choice:
Department of Labor statistics show that 65% of women
with children under age six (10,375,000) are in the labor
force and more than half of them work full-time.
In addition, as Ann Crittenden
points out in The Price of Motherhood, "[m]others'
choices are not made in a vacuum. They are made in a
world that women never made, according to rules they
didn't write." If a wife earns less than her husband,
it may make sense for her to be the one to leave the
workforce. In addition, the workforce is still not a
level playing field for women. The fact that women still
face barriers to equal pay and advancement may also
cause women to be more open to the option of staying
home. Additionally, society still has not made it fully
acceptable for men to take on the role of the "stay-at-home-Dad,"
and men may not be willing to risk stalling their careers
by staying home.
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Claim:
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The
reason women are paid less is because they choose to go
into low-paying occupations that provide greater flexibility.
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Response:
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Research
shows that female-dominated occupations do not offer more
flexibility than other jobs. The reason some women are
paid less is because the jobs filled by women in a company
are not always valued in the same way that men's jobs
are. Studies have shown that the more women and people
of color fill an occupation, the less it pays. Using a
point factor job evaluation system, the state of Minnesota
found that the "women's jobs" paid 20 percent
less on average than male-dominated jobs, even when their
jobs scored equally on the job evaluation system. (Pay
equity adjustments were phased in over four years at a
cost of 3.7 percent of overall payroll.) |
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Claim:
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Many
women, planning to interrupt their careers at some point
in the future to have children, choose occupations where
job flexibility is high, salaries are low, and job skills
deteriorate at a slower rate than others. |
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Response:
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We
believe the idea that women choose jobs in which skills
deteriorate at a slower rate (and thus means they can
leave the workforce and come back without significant
retraining) is an esoteric argument that has little to
do with the every day decisions of average workers. According
to the Department of Labor, the ten leading occupations
for Black and Hispanic women include the jobs of cashiers,
janitors, nursing aides, and maids. There is no data to
support the argument that women are choosing these low-paying
jobs based on the fact that they have a slower rate of
skill deterioration. |
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Claim:
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When
looking at the history of those earning professional school
degrees, very few of the graduates of the 1950s and 1960s,
who today would be at the pinnacles of their professions,
were women. Women simply have not been in the pipeline
long enough to have achieved parity with men. |
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Response:
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Saying
that women have not been in the pipeline long enough does
not tell the whole story. Even when studies control for
the pipeline factor, wage disparities still exist.
Moreover, because of blatant discrimination
before (and to some degree, after) the Civil Rights
Act of 1964, women and minorities had a hard time applying
for many jobs. Some careers simply were not open to
women and minorities. Thus, if you use the argument
that women have not been in the pipeline long enough,
you must acknowledge that the blatantly discriminatory
practices of the past have played a part in determining
that. So discrimination of the past still affects the
current wages of women and people of color.
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The
market will correct wage discrimination on its own. If
pay is too low, employers won't be able to hire anyone,
and wages will naturally rise. |
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The market can
play a role in reducing wage discrimination, but it will
not provide a complete solution. The market has shortcomings,
too. First, the market itself is not free from sex or
race bias. If we had relied on market forces, for example,
we would never have needed the Civil Rights Act of 1964.
Second, if a company or a state
is the largest employer, that employer determines the
market and thus the wages.
Third, we can examine the case
of child care workers. While there is high demand for
child care workers, the median earnings are drastically
low -- only $322 per week according to the Department
of Labor. Because the people who need child care cannot
afford to pay more for it, the market forces do not
work in this instance.
Some economists believe that, while
market competition deters discrimination, employers
with considerable market power are insulated from the
negative effects of discriminating. Even Alan Greenspan
has said that businesses too often practice racial and
other forms of discrimination, which lowers productivity.
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| Claim: |
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If
women were only paid 77¢ on the dollar, then a firm
could fire all its men, replace them with women, and have
a cost advantage over rivals. |
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That would be
illegal under the Equal Pay Act.
Even though the labor of women
and minorities can be bought at a lower cost, companies
are not always driven by the bottom line. We cannot
ignore societal factors that influence hiring and promotion
decisions and workplace behavior. For example, as author
Deborah Swiss uncovers in her book The Male Mind
At Work, which details 54 interviews with male CEOs
and executives, many men say the old-boys network is
still a very real part of the American workplace. The
market does not always overcome the fact that, because
of personal comfort levels, people may help those who
are most like themselves. Some will pay more for the
privilege to discriminate.
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Pay
equity advocates promote a "victim" mentality
among women. They ignore all of the progress that has
been made. |
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It is true that women
and people of color have made important strides over the
past three decades. Indeed, the strengths, abilities,
and convictions of women have opened the doors of opportunity,
and their achievements should be recognized. However,
there are still barriers preventing some workers from
achieving full equality under the law. Pay equity advocates
will not be satisfied until all workers are treated equally
and all of our nation's resources are utilized. |
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ARGUMENTS AGAINST JOB
EVALUATION SYSTEMS |
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Comparable
worth is dependent on tying compensation to job evaluation
systems, which can be highly subjective. |
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Job evaluations can
be subjective, although many employers already use some
kind of job evaluation system to weigh the value of different
jobs based on objective criteria. Job evaluation ratings
can be one of several criteria used for wage-setting.
On the other hand, if a job evaluation is not used as
one of the determinants for pay-setting, what tools should
employers use that are not subjective? |
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Different
jobs dominated by women and men cannot be compared. It's
like comparing apples and oranges. |
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Apples
and oranges can be compared. Certain attributes
of each are comparable: calories and vitamins, for example.
Jobs can also be compared based on their overall skill,
effort, responsibility, and working conditions. In fact,
many employers do just that - job evaluations have been
a common management tool for more than 100 years.
In Los Angeles, for example, social
workers were found to be comparable to probation officers
in skill, effort, responsibility, and working conditions.
Even so, social workers were paid less. In a Portland
pay equity study, the job of typist was found to be
equivalent to water meter readers.
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Comparable
worth is highly subjective. When certain states began
to consider implementing pay equity for their public workforces,
the same occupations scored differently in separate state
job evaluations. |
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Shouldn't
states be able to design pay systems that take into account
the factors they consider most relevant? And besides,
how do we know that the same job titles in different states
involve the same amount of work? Under pay equity, individual
employers (including state employers) determine the worth
of each job. |
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Implementing
pay equity is costly for employers and will lead to job
loss - especially among women. For example, following
the introduction of a comparable worth system in Minnesota,
unemployment in that state rose at a faster rate for women
than for men. |
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In
Minnesota, the state legislature passed the State Government
Pay Equity Act in 1982, which began the implementation
of pay equity for state workers. The simple fact is that
the total number of state employees increased from 32,383
in January 1982 to 35,643 in January of 1986. Women's
representation in state employment increased from 42%
of employees in 1982 to 44% in 1986. Job loss has never
been verified by Minnesota state officials.
Thousands of Minnesota women saw
their earnings rise significantly above the poverty
level. "In 1983, the base salary for a Clerk I
working for the state of Minnesota was $11,922, only
17% above the poverty line of $10,178. Over the next
four years, without the pay equity act, the base salary
would have risen to $13,675, 22% above the then-current
poverty line. However, with pay equity, that Clerk I
took home $15,931, 42% above the poverty line."
(Wage Justice, Sara Evans and Barbara Nelson, University
of Chicago Press, 1989.)
Furthermore, those economists who
claim that wage adjustments in Minnesota had a negative
effect on employment in predominantly female jobs also
acknowledge the unlikelihood that anyone actually lost
her job as a result of pay equity adjustments. Indeed,
one such economist, Mark Killingsworth, merely projects
that employment would have been higher in the absence
of the adjustments. But we cannot reject pay equity
based on one economist's projection.
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Isn't
it reasonable for some men to be paid more because they
have dangerous jobs or jobs that demand physical strength? |
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Sometimes.
Working conditions and physical effort are two of the
factors that are commonly looked at in a pay equity study.
Other factors include (but are not limited to) skill and
level of responsibility. All of these factors are important
and should be reflected in the pay for a job.
With regard to physical strength
and level of danger, we must acknowledge that women
also work in hazardous and physically demanding jobs.
Nursing exposes women to a variety of infectious diseases
and requires lifting patients. For example, the Washington
Post found that a nursing aide's risk of serious injury
is higher than that of a coal minor or of steel mill
workers (The Hazards of Elder Care October 31, 1999).
Lifting and moving patients can lead to back injuries,
and workplace assaults by patients are a major risk.
Of all serious workplace assaults in private industry
in 1997, nursing aides suffered 27 percent of the attacks,
compared with seven percent for security guards.
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CLAIMS
AGAINST NEW LEGISLATION |
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| Claim: |
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If
women have been subjected to wage discrimination, they
can sue for remedies under the Equal Pay Act or Title
VII of the Civil Rights Act. |
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This
claim implies that taking your employer to court to resolve
pay differences is as easy as taking an antihistamine
to relieve the symptoms of a common cold. However, taking
an employer to court is too difficult for most workers.
Plaintiffs are retaliated against
or fired for pursuing fair pay, and often their reputations
are ruined as a company seeks to defend itself against
allegations of wrongdoing. Monetary awards in equal
pay cases can be severely limited, making it impractical
to sue and hard to find an attorney on a contingency
basis. Thus, although the current laws are very important,
they still leave workers with far less power than large
companies in a lawsuit. As a result, many workers do
not sue.
Other workers suspect that they
are being underpaid, but don't know for sure. Because
the laws are complaint-driven, and employers largely
keep the salary information needed to file a complaint
secret, working people can be left without many options.
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If
women are underpaid, they are free to find another job.
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For
several reasons, this argument is too simplistic. Aside
from the fact that it condones discrimination, we must
acknowledge that not everyone has the ability to leave
her job. In rural areas, for example, workers simply do
not have as much choice.
What's more, unless the laws are
changed to help women and people of color find out when
they are being shortchanged, how are they to know they
will be paid fairly at a new job? To some extent, the
market works as a whole. If the jobs dominated by women
and people of color pay less, then simply changing jobs
may not correct the problems.
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If
stronger fair pay legislation is enacted, our courts will
be saddled with frivolous lawsuits. |
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In
the 1960s, this argument was used to oppose the passage
of the Civil Rights Act. In the 1980s, it resurfaced again
to fight the Americans with Disabilities Act. As a result
of these two historic pieces of legislation, our workforce
is more diverse, our economy is stronger, and more citizens
are able to achieve the American Dream.
If workers have assurances that
the pay system is fair, they will not need to seek remedies
under the law. Further, even if laws making it easier
to sue were enacted, taking an employer to court would
still be a long and arduous process - one that most
workers would be hesitant to undertake.
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Pay
equity legislation will result in government wage setting. |
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This is the most
common scare tactic used by opponents of stronger pay
laws. Under all bills proposed, employers set wages, as
they should. Enforcement of the laws would be complaint-driven,
as with current equal pay laws. That means that an individual
who believed she or he had been discriminated against
would first file a complaint. Only after an investigation
and a finding of discrimination could an agency or court
order a remedy - and then only to correct discrimination,
not to engage in generalized wage setting for companies.
With pay equity, employers set
wages individually. The legislation does not apply to
industry wages. It requires only that a legitimate and
non-discriminatory system be used to set wages.
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Sources: NCPE
research; AFSCME - We're Worth It! A Guide to Understanding
and Implementing Pay Equity; AFL-CIO Working Women's
Department - The Case for Equal Pay: Responding to
Common Arguments Against Equal Pay; office of Senator
Tom Harkin (D-IA), Institute for Women's Policy Research.
April 2006
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