The law firm Jackson Lewis launched its series of articles on “Rethinking Pay Equity” with a piece on how companies can reduce pay disparities among women and minorities in their workforce.
The topic is particularly important for New Jersey businesses. A little less than a year ago, New Jersey adopted arguably the strictest equal pay law in the nation. Among other things, pay disparities could cost businesses six years’ worth of back pay and up to triple damages.
This goes beyond just the law, however. The public is increasingly conscious of disparities in the way men and women are treated in the workforce. And these disparities will be highlighted again on April 2, which is being dubbed as “Equal Pay Day” to represent the amount of extra time the average woman has to work before catching up to the average man’s earnings.
When it comes to the laws, Jackson Lewis describes it as a patchwork. New Jersey is joined by Massachusetts, Hawaii, California, Delaware, Oregon and Vermont as the states with equal pay laws, and New York City, Philadelphia and San Francisco have local laws.
Among the best practices Jackson Lewis lists are:
- removing salary history inquiries from applications;
- implementing written guidelines for establishing starting pay;
- conducting an internal review of the pay of others in similar positions for equity;
- documenting reasons for pay differences, particularly in starting pay rates; and
- conducting a broader pay equity analysis under attorney-client privilege to determine if reliance on prior salary history has perpetuated wage gaps.
“According to the Bureau of Labor Statistics, the average woman made 80 percent of the average man’s earnings in the fourth quarter of 2018,” write attorneys Stephanie Lewis, K. Joy Chin and Scott Pechaitis. “At the current pace, the gender pay gap would not be eliminated until approximately 2060. However, many state and local governments have taken action to speed up progress by addressing the perceived causes of the pay gap.”