The Equal Pay Act (1963)

The Equal Pay Act of 1963 A little history: In 1942, as American women man the home front during World War II, the National War Labor Board urges employers to voluntarily make “adjustments which equalize wage or salary rates paid to females with the rates paid to males for comparable quality and quantity of work on the same or similar operations.” Until the early 1960’s, newspapers published separate job listings for men and women. Jobs were categorized according to sex, with the higher level jobs listed almost exclusively under “Help Wanted – Male.” Between 1950 and 1960, women with full time jobs earned on average between cents for every dollar their male counterparts earned in the same job.

The Equal Pay Act of 1963 A little history: It wasn’t until the passage of the Equal Pay Act on June 10, 1963 (effective June 11, 1964) that it became illegal to pay women lower rates for the same job strictly on the basis of their sex. Demonstrable differences in seniority, merit, the quality or quantity of work, or other considerations might merit different pay, but gender could no longer be viewed as a drawback on one’s resumé. Between June 1964 and January 1971 back wages totaling more than $26 million were paid to 71,000 women.

The Equal Pay Act of 1963 Landmark Cases: Schultz v. Wheaton Glass Co. (1970), U.S. Court of Appeals for the Third Circuit  Ruled that jobs need to be substantially equal but not identical to fall under the protection of the Equal Pay Act. An employer cannot, for example, change the job titles of women workers in order to pay them less than men. Corning Glass Works v. Brennan (1974), U.S. Supreme Court  Ruled that employers cannot justify paying women lower wages because that is what they traditionally received under the “going market rate.” A wage differential occurring “simply because men would not work at the low rates paid women” was unacceptable.

The Equal Pay Act of 1963 The “wage gap” has narrowed, but it is still significant. Women earned 59% of the wages men earned in 1963; in 2005 they earned 81% of men’s wages – an improvement of about half a penny per dollar earned every year. Why is there still such a disparity? Rates for young women coming of age in the 1990s reflect women’s social and legal advances. In 2005 women under 25 working full-time earned 93.2% of men’s salaries compared to those 25 and older, who earned 79.4% of what men made. Older women are factored into the wage gap equation, and many of these women from an older generation work in jobs still subject to the attitudes and conditions of the past.

First Exception Bona fide seniority system Bona fide seniority system If men have held jobs longer than women, pay differentials are legitimate. If men have held jobs longer than women, pay differentials are legitimate. Bona fide means that the seniority system must not be self-serving as a means of facilitating wage discrimination. Bona fide means that the seniority system must not be self-serving as a means of facilitating wage discrimination.

Second Exclusion Differences in the quality of performance Differences in the quality of performance If the employer can show that men perform at higher levels than women, then the pay is justified. If the employer can show that men perform at higher levels than women, then the pay is justified. This is problematic because assessment of these criteria is typically subjective. This is problematic because assessment of these criteria is typically subjective.

Third Exception Pay plans that are based on quantity of output (“piece- rate” systems). Pay plans that are based on quantity of output (“piece- rate” systems). Example: Commission-based sales Example: Commission-based sales

Fourth Exception “Factors other than sex” “Factors other than sex” Congress allowed this exception when it realized that it could not anticipate every possible situation that could arise in establishing a basis for equity in pay. Congress allowed this exception when it realized that it could not anticipate every possible situation that could arise in establishing a basis for equity in pay.

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