Holding great promise for women who historically have been paid less than their male counterparts and whose families depend upon this income, the California Fair Pay Act, implemented in January, provides the opportunity to get it right. So, here we are — three months later. Are employers and employees working together to close the gender wage gap or will litigation become the default position? There are some initial positive signs as employers take steps to comply with the law. However, there are companies that are still trying to figure out how to best address pay disparities in their work places.
The strongest law of its kind in the nation, the Act, requires equal pay, regardless of gender, for “substantially similar” work, superseding the existing standard of “equal” work, unless the employer has a bona fide business or non-gender-related reason. As an example of “similar” work, a female housekeeper who cleans rooms in a hotel could challenge the higher wages being paid to a male janitor who cleans the lobby and banquet halls. The statue also prohibits retaliation against employees who invoke the law, protects those who discuss wages and allows claims based on salaries at different workplaces.
In accordance with the new law, experts have been urging companies to thoroughly review their pay practices and records and take the actions needed to meet wage equity requirements. Several companies are exerting proactive leadership. Salesforce, a cloud computing company, has spent $3 million to eliminate significant differences in male/female pay. Intel and Apple have taken steps to successfully reach gender pay equity. The Gap, GoDaddy, Google and SpaceX are applying resources to address wage equity in their companies, among others.
Marc Benioff, Salesforce’s CEO, said, “I believe that businesses are more successful when equality is built into the fabric of the company.” That is a mantra which will well serve employers and employees in California and across the nation, now and over the years to come. Employers take note.
Meanwhile, litigation provides redress to employees and will likely be used to further clarify aspects of the law.
It was due to efforts of Senator Hannah-Beth Jackson (D-Santa Barbara) and the members of the Women’s Caucus that California is now leading the nation when it comes to closing the gender wage gap. And, that gap is vast. A woman in California is making a median 84 cents to every dollar earned by a man. The gap is significantly greater for women of color. African-American women are paid 64 cents on the dollar and Latinas only 44 cents — the most significant Latina wage gap in the nation.
United States Secretary of Labor Thomas Perez got it right when he said, “Our workforce and our entire economy are strongest when we embrace diversity to its fullest, and that means opening doors of opportunity to everyone and recognizing that the American Dream excludes no one.” The Fair Pay Act will help keep those doors open.