My local compensation association (go TCCN!) brought in Cara Welch, WorldatWork's Public Policy Director, to update us on all the regulatory happenings in the total reward field. There was a lot of ground to cover, from healthcare reform to new SEC disclosure rules. Getting a handle on all the new and changed regulations is an overwhelming exercise.
Regular readers know that I have been paying special attention to the Paycheck Fairness Act, along with its "companion" the Fair Pay Act, because of their potential impact on compensation design and management. I took the opportunity of Cara's visit to the Twin Cities to ask her a few questions about the status pay equity regulation in this Congress.
AB: Cara, there are two key compensation bills under consideration today by Congress: the Paycheck Fairness Act and the Fair Pay Act. Briefly, what is the difference between them … what are their key provisions?
CW: The Paycheck Fairness Act would attempt to narrow the pay gap between men and women by restricting the employer defenses in the Equal Pay Act to state that unequal pay for equal work is only allowed for a “bona fide factor other than sex, such as education, training, or experience.” The bill would broaden the definition of establishment; eliminate caps on damages resulting from pay discrimination lawsuits; and make it easier to file class-action lawsuits. (See link for more information http://www.worldatwork.org/waw/adimLink?id=36820)
Fair Pay Act would prohibit wage discrimination based on sex, race, or national origin among employees for work in "equivalent jobs." Equivalent jobs are those where the skill, effort, responsibility, and working conditions are equivalent in value, even if the actual jobs/positions are not the same. Most people refer to it as a comparable worth bill.
AB: From your perspective, how likely is it that either of these two bills will pass into law?
CW: The Paycheck Fairness Act has already been approved by the House of Representatives when it was passed as part of a package along with the Ledbetter Fair Pay Act ( The Ledbetter Fair Pay Act was signed into law as a stand alone bill in 2009. Although it has a similar name to the Fair Pay Act currently in front of Congress the Ledbetter law deals with the timeliness of filing pay discrimination claims). The Paycheck Fairness Act was recently discussed in a Senate Hearing (See link for more information http://help.senate.gov/hearings/hearing/?id=263e16b9-5056-9502-5db9-e17bfa4f6e01)
and it is possible that the full Senate could consider the bill before their August recess.
The Fair Pay Act on the other hand has been introduced in every Congress since at least the late 1990s. It does not have very many co-sponsors and has not received a vote in either the House or the Senate. However, Senator Harkin, the chair of the Senate Health, Education, Labor and Pensions Committee is the sponsor of this bill in the Senate and although he has not said he would do so, may wish to add this bill to any pay discrimination language that does move forward in this Congress. For that reason, it is my personal opinion that there is a chance that this bill could make it’s way into law, as an amendment to any other bill like the Paycheck Fairness Act. I don’t think the Fair Pay Act will pass as a stand alone bill, though.
AB: So it is possible that some of the comparable worth elements and language from the Fair Pay Act will find their way into the Paycheck Fairness Act before it is ultimately signed into law?
CW: I think that amending the Paycheck Fairness Act is probably the route to passage for this bill. Since there is still opposition to the Paycheck Fairness Act itself, this is probably not likely, but for advocates it is probably the best chance of getting comparable worth signed into law.
AB: If that happens, will there be opportunity for individuals and groups like WorldatWork to offer guidance and perspective on the impact of the legislation?
CW: WorldatWork has not commented officially on these bills but is tracking and reporting back to our members on the status of the bills. Now would be the time to let your representatives and Senators know your thoughts on the Fair Pay Act and to talk to your Senators about the Paycheck Fairness Act. It will be more difficult to be heard if you wait until right before passage. We are certainly interested in hearing what practitioners think of these bills.
My special thanks to Cara for sharing her thoughts here and for her dynamic, candid presentation on public policy to our local association. If you aren't already reading it, please check out Cara's (and her staff's) Public Policy Perceptions blog for the latest on total rewards public policy.
Now a couple of my thoughts ... along with some questions for my readers.
I worry that the Paycheck Fairness Act has a very good shot at being passed in the coming months. My particular concern is that we will also get comparable worth enacted via adding the Fair Pay Act as an amendment to that (or some other) bill. Few HR or even reward professionals seem to have a clear sense of what comparable worth entails or what its impact would be on the most fundamental aspects of pay design and administration; so it's a fair guess that our elected representatives don't have much idea either. Given the way that this Congressional session has gone, I can very well imagine this happening well before any of us knows what has hit us.
The question is: What, if anything, do we do?
How many of you feel confident in your understanding of comparable worth? Does what you know lead you to be concerned about comparable worth legislation being passed? What are your thoughts about the possibility of comparable worth regulations being enacted before the end of the session? And if it does pass, and our profession has essentially stayed out of the debate, will we regret it?
I invite, welcome and appreciate your comments here!