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Pay Equity Initiatives Flood the State Legislatures

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In 2017, legislatures in more than 40 jurisdictions across the United States considered more than 100 bills intended to narrow the lingering pay gap between men and women.

While only a handful of those proposals ultimately became law, this wave shows no signs of subsiding. Most state legislatures are back in session and lawmakers are quickly picking up where they left off.

At least 23 states, from Hawaii to New Jersey, have introduced some type of pay equity measure thus far in 2018. These bills (approximately 50 to date) often take different approaches. Some measures would broaden existing equal pay laws, for example, while other proposals would create new restrictions, such as a ban on employer salary history inquiries. The rationale underlying the salary history bill trend is that pay inequities are perpetuated when current pay is based on past employer decisions that could have been discriminatory. Legislatures have also considered wage transparency measures, which prevent employers from banning pay disclosure in the workplace, or from retaliating against employees who discuss their wages with others. In recent years, salary history and pay transparency proposals have been introduced as standalone bills or incorporated into more expansive pay equity legislation.

With a variety of statutes taking effect in 2018, plus the torrent of pay equity bills, employers should pay close attention to this issue.

Notable Pending Pay Equity Proposals

Even as employers adjust their policies and procedures to comply with new laws, they must keep a watchful eye for additional regulations. Numerous pay equity measures have been proposed, and, as noted below, a few are already showing potential.

Comprehensive Equal Pay Bills

Thus far in 2018, more than 10 states have introduced bills to adopt pay equity laws or strengthen existing statutes. A Washington proposal (H.B. 1506), for example, would amend the equal pay act to outlaw any discrimination in compensation based on gender between employees who are "similarly employed." According to the bill, "employees are similarly employed if the individuals work for the same employer, the performance of the job requires similar skill, effort, and responsibility, and the jobs are performed under similar working conditions." The measure provides that "[j]ob titles alone are not determinative" of this similarity.

That being said, H.B. 1506 would permit pay discrepancies if "based in good faith on a bona fide job-related factor," so long as that factor is "consistent with business necessity," is not "derived from a gender-based differential," and accounts for the entire disparity. Such factors can include education or reliance on a seniority, merit, or piece-rate compensation system.

While these terms are similar to other updated, more progressive equal pay statutes, H.B. 1506 does not stop there. It further states that employers may not limit an employee's "career advancement opportunities" on the basis of gender, including by failing to announce such opportunities or provide training. This Washington bill also includes a wage transparency provision. H.B. 1506 has passed the Washington house and is presently under review in a senate committee.

Other equal pay permutations were proposed in Alabama, Arizona, Hawaii, Indiana, Missouri, Mississippi, Nebraska, New Jersey, Rhode Island, South Carolina, and Tennessee. Meanwhile, in Mississippi, several measures that would have created a new equal pay law have already died in committee.

Standalone Salary History Bills

State lawmakers continue to gravitate toward salary history bills. Legislators in at least 11 jurisdictions, including Arizona and Rhode Island, have introduced such measures.

Proposals in Illinois and New Jersey may prove particularly promising. Illinois nearly enacted a salary history bill in its last legislative term. Governor Bruce Rauner vetoed a salary history proposal, and lawmakers fell short when attempting to override that veto in November. But an identical bill (H.B. 4163) was introduced soon thereafter, and it is now progressing through the house.

Like Illinois, New Jersey came very close to prohibiting salary history inquiries in its 2016-2017 session. A bill passed both chambers but died on Governor Chris Christie's desk. Subsequent proposals have been filed, however, and the new Democratic governor, Phil Murphy, is inclined to enact a salary history ban if given the chance. Indeed, his first executive order, signed the same day as his inauguration, barred state agencies from asking job applicants about their prior wages.

Standalone Wage Transparency Bills

Finally, at least 10 states will be weighing standalone wage transparency bills in 2018. Lawmakers in states spanning from Hawaii to Virginia have introduced such measures, which await committee review.

Given the number of pending pay equity bills, and the unlikelihood of federal equal pay legislation advancing this year, efforts to promote pay equity legislation at the state and local level are expected to persist.

Posted In: Congressional Activity; Illinois; Equal Pay Act

Want to know more? Read the full article by Aaron Crews at Littler Mendelson

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