Pay equity has become a very hot topic when it comes to business compliance. Fair-pay policies have begun to rise to the forefront with recent social awareness. Businesses that implement fair-pay policies have found that in addition to avoiding possible legal issues, they also often experience an improved reputation for their organization. If you have never delved into pay equity, the following are some things you need to know:
What Is Pay Equity?
Pay equity refers to providing equal compensation to employees with similar jobs in an organization no matter their race, ethnicity, or gender. Other factors do come into play when it comes to determining salaries, including work experience, education, specialized training, and the like.
Pay equity ensures you avoid legal action by employees who believe they have been discriminated against. It also ensures you comply with equal pay regulations. Pay equity can have an overall positive impact on an organization. As an organization, you will notice improved morale, improved productivity, reduce turnover, and potentially attract new employees.
Are There Laws Surrounding Pay Equity?
There are federal laws surrounding pay equity. The Equal Pay Act of 1963 states that men and women who work at the same organization have the right to equal pay for the same work functions. The Title VII of the Civil Rights Act of 1964 provides protections not outlined in the Equal Pay Act. The law prohibits any discrimination due to not only gender but also religion, nationality, and race. As you can see, pay equity has been an important issue long before the recent social awareness.
How Are Pay Equity Issues Being Addressed by the Government?
Most all states have equal pay laws. Some are more expanded than others. Some states place importance on transparency when making improvements in pay equity. For instance, some states require that minimum and maximum pay ranges must be included when advertising a job.
States are also prohibiting inquiries on salary histories. For example, some states prevent employers from setting a pay rate based on an applicant's salary history. States also may restrict any discussion of salary history altogether. As an organization, make sure you are fully aware of the equal pay laws in your state.
Legal counsel is crucial when dealing with equal pay laws and pay equity. You do not want to make any mistakes and risk a discrimination lawsuit from one or more employees who feel they are not being paid equally compared to others in the organization.
For more info about equal pay, contact a local professional.