Women make up about 60% of college and university students.  They were six percentage points more likely to graduate high school on schedule in 2018, leaving 18% of men without a diploma received on time. 

Yet at work, women earn less wages than men.  In terms of median weekly real earnings, women have been earning about $70 less per week than men have over the past decade.  The gap was even larger, about $100 per week less than men, in 1995.

According to the White House, the “pay gap” is a persistent problem. It writes: “President Biden and Vice President Harris have long championed equal pay as a cornerstone of their commitment to ensuring opportunity and fairness for all workers.”

This week, the Biden administration announced new steps to make more equal weekly wages a reality for women at work.  It points to salary history as a driver of unequal pay.  The Director of the U.S. Office of Management and Budget, Shalanda Young, announced a new ban on the consideration of salary history in setting the pay of new employees of the federal government.  This will counteract “preexisting inequality in our pay structures,” which “disproportionately impact[s] women and workers of color.”

The reform will not prevent the government from hiring the best people for the job, Director Young argues.  Rather, it “will help federal agencies recruit high-performing talent that not only fully represents the American people but most effectively delivers for them.” 

Remaining to be decided is whether the federal government will announce a rule restricting federal contractors from using salary history to set pay or make hiring or retention decision.

Legal Remedies for Equal Pay

In 1963, the U.S. Congress passed a law guaranteeing equal pay for equal work.  It is called the Equal Pay Act. 

The question has arisen as to whether an employer deciding on pay based on a prior rate of pay is a neutral, nondiscriminatory factor that justifies or allows an employer to pay a female employee less than a male one who perform the same work.  Courts have occasionally differed with one another on this question.  One of them stated that unlike seniority, merit-based pay, and pay for output or productivity, which are reasons for paying more based on job qualifications or job performance that do not violate the Equal Pay Act, paying based on salary history is not related to current job performance and can constitute unequal pay.  Others disagree, and may allow salary history to be used in setting new salaries as long as gender is not used and more qualified persons of one gender are not paid less than less qualified ones of the other.

Title VII of the Civil Rights Act prohibits employment decisions that are based on considerations of gender or that have an adverse impact on persons of one gender that are not justified.  Sometimes it is called a statute that requires more intent or unreasonableness than the Equal Pay Act.  Still, an employee does not always need a “smoking gun” of discrimination under Title VII.  She or he may use a difference in treatment, her or his qualifications for the position, and problems with the employer’s excuses for treating her or him worse to show sex discrimination. 

The New York Labor Law also prohibits unequal pay for equivalent work.  It has a standard that is easier for an employee claiming unequal pay to prove, according to the federal appeals court that hears appeals from federal courts in New York State and Connecticut.  The Labor Law and the New York City Code also have salary history usage bans. 

Employers may argue that barring them from asking about salary history restricts their freedom of speech.  There is emerging authority, however, that the employer’s use of salary history, and even asking about it, is conduct in the commercial domain rather than absolutely protected free speech.

Next Steps

It is important to know your rights when it comes to harassment, discrimination, and equal opportunity employers.  A free consultation can help you understand your rights and take action to protect them, including by contacting human resources or the government.