Pay Equity Legislation

Prepared for Members and Committees of Congress

The term “pay equity” originates from the fact that women as a group are paid less than men. In
2007, for example, women with a strong commitment to the work force earned about 78-80 cents
for every dollar earned by men. As women’s earnings as a percentage of men’s earnings have
narrowed by less than 20 percentage points over the past 40-plus years, some members of the
public policy community have argued that current anti-discrimination laws should be
strengthened and that additional measures should be enacted. Others, in contrast, believe that
further government intervention is unnecessary because the gender wage gap will narrow on its
own as women’s labor market qualifications continue to more closely resemble those of men.
The Equal Pay Act (EPA), which amends the Fair Labor Standards Act (FLSA), prohibits covered
employers from paying lower wages to female than male employees for “equal work” on jobs
requiring “equal skill, effort, and responsibility” and performed “under similar working
conditions” at the same location. The FLSA exempts some jobs (e.g., hotel service workers) from
EPA coverage, and the EPA makes exceptions for wage differentials based on merit or seniority
systems, systems that measure earnings by “quality or quantity” of production, or “any factor
other than sex.” The “equal work” standard embodies a middle ground between demanding that
two jobs be either exactly alike or that they be merely comparable. The test applied by the courts
focuses on job similarity and whether, given all the circumstances, they require substantially the
same skill, effort, and responsibility. The EPA may be enforced by the government, or individual
complainants, in civil actions for wages unlawfully withheld and liquidated damages for willful
violations. In addition, Title VII of the 1964 Civil Rights Act provides for the award of
compensatory and punitive damages to victims of “intentional” wage discrimination, subject to
caps on the employer’s monetary liability.
The issue of pay equity has attracted substantial attention in recent Congresses. A number of
measures, including bills that would have provided additional remedies, mandated “equal pay for
equivalent jobs,” or required studies on pay inequity, have been introduced in each of the last
several congressional sessions. In response to a 2007 Supreme Court decision, several members
of Congress have introduced bills that would clarify the deadline for filing pay discrimination and th
other claims under Title VII and related statutes. The following bills were introduced in the 110
Congress: H.R. 1338, H.R. 2019, H.R. 2660, H.R. 2831, H.R. 5129, S. 766, S. 1087, S.

1843, and S. 2554. Meanwhile, several companion bills have been introduced in the 111th

Congress (H.R. 11/S. 181 and H.R. 12/S. 182). The House of Representatives passed both H.R.
11 and H.R. 12 on January 9, 2009, and it has been reported that the legislation will be combined
and scheduled for a vote in the Senate during the week of January 12, 2009.

The Gender Wage Gap....................................................................................................................1
The Male-Female Pay Differential Over Time..........................................................................1
Explanations of and Remedies for the Gender Pay Differential...............................................3
Legal and Legislative Background..................................................................................................4
Laws That Combat Sex-Based Wage Discrimination...............................................................4
“Comparable Worth” Litigation and Other Judicial Developments..........................................5
Recent Legislation...........................................................................................................................8
Table 1. Ratio of Female-to-Male Earnings....................................................................................2
Author Contact Information...........................................................................................................11

he persistence of gender-based wage disparities—commonly referred to as the pay or wage
gap—has been the subject of extensive debate and commentary. Congress first addressed 1
the issue nearly four decades ago in the Equal Pay Act of 1963, mandating an “equal pay 2T

for equal work” standard, and again the following year in Title VII of the 1964 Civil Rights Act.
Collection of compensation data and elimination of male/female pay disparities are also integral
to Labor Department enforcement of Executive Order 11246, which mandates nondiscrimination
and affirmative action by federal contractors. During the 1980s, some members of the public
policy community sought to advance the earnings of women relative to men by pressing a
“comparable worth” theory before state legislatures and in federal court litigation. During the last thst
decade of the 20 century and the initial years of the 21 century, initiatives to strengthen and
expand current federal remedies available to victims of unlawful sex-based wage discrimination
have been taken up in Congress.
This report begins by showing the trend in the male-female wage gap and by examining the
explanations that have been offered for its enduring presence. It next discusses the major laws
directed at eliminating sex-based wage discrimination as well as relevant federal court cases. The
report closes with a description of pay equity bills that have been introduced in recent years, th
including bills introduced in the 111 Congress.

The term “pay equity” originates from the fact that women as a group are paid less than men. In
1960, half of all women employed year-round full-time (i.e., 50-52 weeks and at least 35 hours
per week) earned more than $3,257 and half earned less than that amount. In the same year, the
median annual earnings of men employed year-round full-time were $5,368. Almost five decades
later, according to U.S. Census Bureau data for 2007, the median earnings of women with a
strong commitment to the labor force were $35,102, while those of men were a substantially
higher $45,113.
It often is noted that even when comparisons are made between similar groups, women still are
paid less than men. Women with a bachelor’s degree employed year-round full-time earned
$52,859 in 2007, while similarly educated men earned an average of $77,536. Male high school
graduates were paid $42,042 on average, well above the $30,657 paid to female high school
graduates. Women typically earn less than men of the same age, as well. The wage gap is
narrowest among young adults, and then it generally widens. Although these disparities between
seemingly comparable men and women sometimes are taken as proof of sex-based wage
inequities, the data have not been adjusted to reflect gender differences in all characteristics that
can legitimately affect relative wages (e.g., college major or uninterrupted years of employment).
The size of the male-female wage gap has shrunk at a slow and uneven pace over time. As shown
in Table 1, the pay differential narrowed steadily during the 1980s so that by the end of the
decade women were being paid about 70 cents on the dollar. The trend for the 1990s is less clear:

1 29 U.S.C. § 206(d).
2 42 U.S.C. §§ 2000e et seq.

according to both the median earnings series of the Census Bureau (columns 2 and 5) and of the
Bureau of Labor Statistics (columns 3 and 6) shown in the table, the ratio of female-to-male
wages fluctuated erratically and sometimes in different directions during the decade; the extent of
improvement in the gender wage gap that occurred during the 1980s does not appear to have been
sustained during the 1990s. The wage gap thus far during the 2000s has narrowed further,
according to the Census Bureau series (column 2) but, according to the Bureau of Labor Statistics
series (column 3), the gap widened in the last few years.
Despite women’s greatly increased commitment to the labor force over the past 40-plus years,3
the observed or unadjusted wage gap has narrowed by less than 20 percentage points or less than
half a percentage point per year. Consequently, by 2007, women with a strong attachment to the
job market had come to earn about 78-80 cents for every dollar earned by men.
Table 1. Ratio of Female-to-Male Earnings
Year-round full-time Full-time Year-round full-time Full-time
Year workersa workersb Year workersa workersb
2007 77.8 80.2 1983 63.6 66.7
2006 77.0 80.7 1982 61.7 65.4
2005 77.0 81.0 1981 59.2 64.6
2004 76.6 80.4 1980 60.2 64.4
2003 75.5 79.4 1979 59.7 62.5
2002 76.6 77.9 1978 59.4 n.a.
2001 76.3 76.1 1977 58.9 n.a.
2000 73.7 76.0 1976 60.2 n.a.
1999 72.3 76.5 1975 58.8 n.a.
1998 73.2 76.3 1974 58.8 n.a.
1997 74.2 74.4 1973 56.6 n.a.
1996 73.8 75.0 1972 57.9 n.a.
1995 71.4 75.5 1971 59.5 n.a.
1994 72.0 76.4 1970 59.4 n.a.
1993 71.5 77.1 1969 58.9 n.a.
1992 70.8 75.8 1968 58.2 n.a.
1991 69.9 74.2 1967 57.8 n.a.
1990 71.6 71.9 1966 57.6 n.a.
1989 68.7 70.1 1965 59.9 n.a.
1988 66.0 70.2 1964 59.1 n.a.
1987 65.2 70.0 1963 58.9 n.a.

3 The percentage of all women age 16 and older who were in the labor force rose from 38% in 1960 to 59% in 2007.
Women today account for almost one-half of those in the labor force compared to one-third some four decades earlier.
The heightened commitment to paid employment of married women with dependent children (under age 18) is
particularly noteworthy.

Year-round full-time Full-time Year-round full-time Full-time
Year workersa workersb Year workersa workersb
1986 64.3 69.2 1962 59.3 n.a.
1985 64.6 68.2 1961 59.2 n.a.
1984 63.7 67.8 1960 60.7 n.a.
Source: U.S. Census Bureau data on year-round/full-time workers, and U.S. Bureau of Labor Statistics data on
full-time workers.
Note: The wage gap based on annual data (columns 2 and 5) is wider than the wage gap based on weekly data
(columns 3 and 6) because women generally work fewer weeks and hours per week than men. In addition, the
annual data include self-employed workers who have larger earnings differences by gender than the wage and
salary workers covered by the weekly series. Regardless of the interval, the gender wage gap would be wider if
all workers were compared because relatively more women than men work part-time or part-year schedules.
n.a. = not available.
a. Based on median annual earnings of all workers age 15 or older (14 or older before 1980) employed year-
round full-time (i.e., 50-52 weeks in a year and at least 35 hours in a week), including the self-employed.
Before 1989, earnings covered civilian workers only.
b. Based on median weekly earnings of wage and salary workers age 16 or older employed full-time.
The existence and persistence of the gender wage gap has led to a search for explanations.
Basically, two schools of thought have developed. The human capital explanation has a supply-
side focus—that is, it looks at the personal characteristics of working women and men. The sex-
segregation-in-the-workplace or discrimination explanation has a demand-side focus—that is, it
looks at the characteristics of the jobs in which women and men typically work.
Some researchers have tried to explain the pay gap by examining differences in the average
amounts of human capital (e.g., educational attainment) accumulated by women and men. Other
researchers have looked to job-related factors for an explanation of the wage gap, with some
particularly focusing on the relationship between sex segregation in the workplace and women’s
comparatively low wages. (In this instance, segregation refers to the clustering of women and
men in different occupational groups, in different occupations within these groups, in different
jobs within these occupations, and in different industries or firms performing the same jobs.) Still
others have attributed the wage gap to a combination of personal characteristics (e.g., number of
hours worked per week or year) and job characteristics (e.g., extent of unionization or size of
firm). Although adjusting women’s and men’s wages for human capital and job-related 4
differences considerably narrows the pay gap, it does not entirely eliminate it.
Those who ascribe to the human capital explanation of the gender wage disparity argue that as
women increasingly become like men in terms of their participation in the workforce, women’s
earnings will further approach those of men. They thus believe that no government intervention is
warranted to achieve pay equity beyond current anti-discrimination measures. Others believe that
sex-based wage discrimination is responsible for the pay gap that remains after accounting for

4 See CRS Report 98-278, The Gender Wage Gap and Pay Equity: Is Comparable Worth the Next Step?, by Linda
Levine, for a review of empirical analyses of the male-female wage gap. (Hereafter cited as CRS Report 98-278, The
Gender Wage Gap and Pay Equity: Is Comparable Worth the Next Step?)

gender differences in labor market qualifications. They support strengthened government
enforcement of anti-discrimination laws and regulations, enhanced government dissemination of
information about and provision of training in comparatively high-paying nontraditional jobs for 5
women, or employers paying female and male employees in comparable jobs the same wages. In
the 1980s, the latter perspective led to largely unsuccessful lawsuits that brought “comparable
worth” claims under Title VII of the Civil Rights Act. (These lawsuits are discussed in the next
section of this report.)
The idea motivating comparable worth is that the size of a worker’s paycheck should be related to
job content rather than to the predominant sex of employees in an occupation. Comparable worth
proponents argue that some jobs are undervalued—that is, pay relatively low wages—because
they are largely held by women. Instead of continuing to largely rely on supply-demand
conditions in the labor market to set wages and instead of waiting for further lessening of sex
segregation in the workplace, comparable worth advocates typically propose that a job evaluation
be conducted on all positions within a firm so they can be compared with each other in terms of
such attributes as skill, effort, responsibility, and working conditions. Employers would then raise
the wages of workers in all jobs or in female-dominated jobs deemed to be underpaid on the basis
of the evaluation (i.e., jobs with wages below other jobs having the same total scores on the 6
attributes included in the evaluation would be awarded raises).

The Equal Pay Act (EPA) is a 1963 amendment to the Fair Labor Standards Act that makes it
illegal to pay different wages to employees of the opposite sex for equal work on jobs the
performance of which requires “equal skill, effort, and responsibility,” and which are “performed 7
under similar working conditions.” The act also prohibits labor organizations and their agents
from causing or attempting to cause sex-based wage discrimination by employers. Specifically
permitted by the EPA, however, are wage differentials based on seniority systems, merit systems,
systems that measure earnings by quality or quantity of production, or “any factor other than 8
sex.” The “equal work” standard embodies a middle ground between demanding that two jobs be
either exactly alike or that they merely be comparable. The test applied by the courts focuses on
job similarity and whether, in light of all the circumstances, they require substantially the same 9
skill, effort, and responsibility. An employer may not attempt to equalize wages to comply with 10
the EPA by lowering the rate of pay for any employee.

5 Congress has attempted to reduce occupational segregation. The Women in Apprenticeship and Nontraditional
Occupations Act (WANTO, P.L. 102-530) provides technical assistance to employers and unions to promote women’s
employment in apprenticeable and other nontraditional jobs. Through FY1995, the Nontraditional Employment for
Women Act (P.L. 102-235) had authorized the use of the Job Training Partnership Act’s discretionary funds to develop
demonstration programs to help women enter high-paying jobs where they were underrepresented.
6 See CRS Report 98-278, The Gender Wage Gap and Pay Equity: Is Comparable Worth the Next Step?, for
information on the potential labor market effects of relying upon job evaluation as a wage-setting mechanism to
implement comparable worth.
7 29 U.S.C. § 206(d)(1).
8 Id.
9 E.g. EEOC v. Madison Community United School District, 818 F.2d 577 (7th Cir. 1987)(“equal work” requires a

A year after passage of the EPA, Congress enacted the comprehensive code of anti-discrimination
rules based on race, color, national origin, religion, and sex found in Title VII of the Civil Rights
Act. The EPA and Title VII provide overlapping coverage for claims of sex-based wage
discrimination, but differ in important substantive, procedural, and remedial aspects. A crucial
difference is that the “equal work” standard of the EPA—requiring “substantial” identity between
compared male and female jobs—does not limit an employer’s liability for intentional wage 11
discrimination under Title VII. For example, in Miranda v. B & B Cash Grocery Store, Inc., the
plaintiff’s inability to demonstrate that she performed the same work as higher paid males did not
preclude a Title VII claim based on evidence male employees who performed fewer duties were
paid more than she, or that the employer would have paid her more had she been a male. Thus, a 12
violation of the EPA will generally violate Title VII, but the converse is not true.
Additionally, the remedies for violation of the two laws differ. Under the EPA, a prevailing
plaintiff may obtain backpay for any wages unlawfully withheld as the result of pay inequality
and twice that amount in liquidated damages for a willful violation. By contrast, the Civil Rights
Act of 1991 added to the back pay remedy authorized by Title VII a provision for jury trials and
compensatory and punitive damages for victims of “intentional” sex discrimination in wage cases 13
and otherwise. Such damages may only be recovered, however, in cases of intentional
discrimination, not in so-called “disparate impact” cases alleging the adverse effect of a facially
neutral employment practice on a protected group member. In addition, the Title VII damages 14
remedy is limited by dollar “caps,” which vary depending on the size of the employer.
During the 1980s, some litigants tried to substitute job equivalency for the “equal work standard”
in the EPA through so-called comparable worth Title VII cases. As previously mentioned, whole
classes of jobs are undervalued according to comparable worth theory because they traditionally
have been predominately held by women. Because of alleged labor market bias against female-
dominated jobs, Title VII plaintiffs contended that pay discrimination claims should not be
limited by the EPA standard, requiring that jobs be substantially “equal” or similar for different
pay rates to be considered discriminatory. Instead, Title VII wage-based discrimination actions
against employers could be predicated on job evaluation studies, they argued, which compared
the value of women’s jobs to those of men who perform work that is dissimilar, but of equivalent
or comparable worth to the employer.

substantial identity rather than an absolute identity).
10 29 U.S.C. § 206(d)(1).
11 975 F.2d 1518 (11th Cir. 1992).
12 29 C.F.R. § 1620.27(a).
13 42 U.S.C. § 1981A. Compensatory damages includefuture pecuniary losses, emotional pain, suffering,
inconvenience, mental anguish, loss of enjoyment of life and other nonpecuniary losses. Punitive damages may be
recovered where the employer acted “with malice or with reckless indifference to the complaining employee’s
federally protected rights.
14 The sum total of compensatory and punitive damages awarded may not exceed $50,000 in the case of an employer
with more than 14 and fewer than 101 employees; $100,000 in the case of an employer with more than 100 and fewer
than 201 employees; $200,000 in the case of an employer with more than 200 and fewer than 500 employees; and
$300,000 in the case of an employer with more than 500 employees.

Although not a comparable worth case, County of Washington v. Gunther held that the EPA’s
equal work standard was not a restriction on Title VII relief for intentional sex-based 15
discrimination in pay between dissimilar male and female jobs. But the Supreme Court did not
speak specifically to the Title VII standard of proof for wage discrimination, since in Gunther the
county’s intention was clearly demonstrated by its failure to redress underpayment of wages to
female employees revealed by its own pay evaluation study. Outside of such “refusal to pay”
cases, however, where no market surveys or pay evaluations were done, the courts have been
reluctant to second-guess the wage rate dictated by the local labor market for dissimilar jobs. In a
pair of decisions, the Ninth Circuit firmly rejected Title VII liability for a public employer’s
failure to pay equal wages to male and female employees allegedly performing comparable 16
duties. That case, AFSCME v. State of Washington, held that the state lawfully paid employees
in predominantly male job classifications more than it paid employees in predominantly female
classifications, even though a state-commissioned study concluded that the male and female
classifications were “comparable.” Reliance on market forces of supply and demand to set
compensation for dissimilar male and female jobs was not per se illegal since “[n]either law nor
logic deems the free market system a suspect enterprise.” The state “may” have discretion to
enact a comparable worth plan, the court held, but “Title VII does not obligate it to eliminate an 17
economic inequality which it did not create.” Earlier, in Spaulding v. University of 18
Washington, the same court denied a comparable worth claim by members of the female nursing
faculty of the University of Washington who alleged that they were underpaid by comparison to 19
other faculty departments.
Some more recent judicial developments in equal pay and promotional opportunities for women
should also be noted. On June 21, 2004, a federal district judge in San Francisco permitted to
proceed a class action on behalf of more than 1.5 million current and former female employees of 20
Wal-Mart retail stores nationwide. In Dukes et al. v. Wal-Mart Stores, Inc., the plaintiffs claim
that women over the past five years have been paid less than male workers in comparable
positions and that the company systematically passed over female employees when awarding
promotions to management. According to two studies conducted by a sociologist and a statistician
for the plaintiffs, 65 percent of Wal-Mart’s hourly employees were women, but women make up
only 33 percent of all management positions. The gender gap was even more striking when
employment categories are further broken down; while the vast majority of Wal-Mart’s cashiers
are women, only a small fraction are store managers, the top in-store management position. The
studies also found that women employed on a full-time hourly basis earned less per year on
average than their male counterparts, and the short fall was substantial for female store managers.
At this initial stage, the district court considered only whether the evidence raised issues of law
and fact common to all members of the proposed class sufficient for a class action to proceed
under federal law. The court did not decide the merits of plaintiffs’ discrimination claims or any
issue of Wal-Mart liability. In its opinion, however, the court noted:

15 452 U.S. 161 (1981).
16 770 F. 2d 1401 (9th Cir. 1985).
17 Id. at 1407.
18 740 F. 2d 686 (9th Cir. 1984).
19 See also American Nurses Ass’n v. State of Illinois, 606 F. Supp. 1313 (N.D.Ill. 1985)(Congress never intended to
incorporate a comparable worth standard in Title VII and such a concept is neither sound nor workable).
20 222 F.R.D. 137 (N.D.Cal. 2004).

Plaintiffs present largely uncontested descriptive statistics which show that women working
at Wal-Mart stores are paid less than men in every region, that pay disparities exist in most
job categories, that the salary gap widens over time, that women take longer to enter
management positions, and that the higher one looks in the organization the lower the 21
percentage of women.
Wal-Mart argued that any disparities were the result of decentralized decision-making at the
regional and local level, not the result of any systematic employer bias, and that a massive class-
action would be too large to administer. The court rejected that argument, however, noting that
Title VII “contains no special exception for large employers.” Moreover, “[i]nsulating our
nation’s largest employers from allegations that they have engaged in a pattern or practice of
gender or racial discrimination—simply because they are large—would seriously undermine 22
these imperatives.” Thus, any “inference” of discrimination in company compensation and
promotion policies was found to “affect all plaintiffs in a common manner,” and warranted the 23
requested class certification.
Wal-Mart appealed the district court’s class action certification, but the appellate court upheld the 24
class action certification. If, as expected, the case now goes to trial, the female plaintiffs carry
the burden of proving that the company engaged in an intentional pattern and practice of
discriminating in pay and promotions. The record to date suggests that this may be no easy task,
in part due to subjectivity in the company’s personnel procedures and the fact that, prior to
January 2003, the company apparently failed to post or document most available promotion 25
opportunities. There may be limited data on how many employees, male or female, applied for
most of these positions. But if they prevail, whether at trial or by settlement, substantial monetary
damages may be available to members of plaintiff class under Title VII.
Since the ruling in the Wal-Mart case, the investment firm Morgan Stanley has reportedly agreed
to pay $54 million to settle government claims that it systematically underpaid and failed to
promote its women executives. Allegations of sexual harassment were also involved in the case.
Beyond $12 million set aside to pay the lead plaintiff, a consent decree provides $40 million for
any of about 340 other potential discrimination victims who are able prove their claims, and
another $2 million to establish internal anti-discrimination programs. For a period of three years,
the decree requires appointment of a firm ombudsman for sex discrimination issues and of an
external monitor to review Morgan Stanley’s adherence to the settlement and its progress at 26
preventing discrimination. Shortly after settlement in the Morgan Stanley case, both Boeing and 27
Citigroup agreed to settle similar pay equity lawsuits, and Costco was sued for similar reasons.

21 Id. at 155.
22 Id. at 142.
23 Id. at 166.
24 Dukes v. Wal-Mart, 509 F.3d 1168 (9th Cir. 2007).
25 Dukes, 222 F.R.D. at 149.
26 Brooke A. Masters,Wall Street Sex-Bias Case Settled; Morgan Stanley Agrees to Pay $54 Million, Washington
Post, July 13, 2004, at E01.
27 Brooke A. Masters and Amy Joyce, “Costco is the Latest Class-Action Target; Lawyers’ Interest Increases in
Potentially Lucrative Discrimination Suits,” Washington Post, August 18, 2004, at A01.

A federal district court recently granted class-action status to the plaintiffs in the Costco lawsuit,28 29
although the company is planning to appeal the decision.
Meanwhile, the Supreme Court issued a decision that may make it more difficult for employees to 30
sue for pay discrimination under Title VII. In Ledbetter v. Goodyear Tire & Rubber Co., Inc.,
the female plaintiff alleged that past sex discrimination had resulted in lower pay increases and
that these past pay decisions continued to affect the amount of her pay throughout her
employment, resulting in a significant pay disparity between her and her male colleagues by the
end of her nearly 20-year career. Under Title VII, plaintiffs are required to file suit within 180 31
days “after the alleged unlawful employment practice occurred.” Although the plaintiff argued
that each paycheck she received constituted a new violation of the statute and therefore reset the
clock with regard to filing a claim, the Court rejected this argument, reasoning that “a new
violation does not occur, and a new charging period does not commence, upon the occurrence of
subsequent nondiscriminatory acts that entail adverse effects resulting from the past 32
discrimination.” As a result, the Court held that the plaintiff had not filed suit in a timely
manner. Although the decision may limit some pay discrimination claims based on Title VII,
individuals may still sue for sex discrimination that results in pay bias under the EPA, which does 33
not contain the 180-day filing requirement.

The issue of pay equity has garnered considerable congressional attention in recent years. A
number of measures were introduced in each of the last several congressional sessions, and th
several similar companion bills have been introduced in the 111 Congress (H.R. 11/S. 181 and
H.R. 12/S. 182). The House of Representatives passed both H.R. 11 and H.R. 12 on January 9,
2009, and it has been reported that the legislation will be combined and scheduled for Senate
consideration during the week of January 12, 2009.
Introduced in each of the last several congressional sessions, the Paycheck Fairness Act (H.R. thth
1338 and S. 766 in the 110 Congress; H.R. 12/S. 182 in the 111 Congress) would increase
penalties for employers who pay different wages to men and women for “equal work,” and would
add programs for training, research, technical assistance, and pay equity employer recognition
awards. The bill would also make it more difficult for employers to avoid EPA liability, and
proposed safeguards would protect employees from retaliation for making inquiries or disclosures
concerning employee wages and for filing a charge or participating in any manner in EPA
proceedings. In short, while this bill adheres to current equal work standards of the EPA, it would
reform the procedures and remedies for enforcing the law. On July 24, 2008, the House
Committee on Education and Labor approved H.R. 1338, with some modifications. On July 31,
2008, H.R. 1338 was passed by the House with additional modifications. The bill did not advance

28 Ellis v. Costco Wholesale Corp., 240 F.R.D. 627 (D. Cal. 2007).
29 Abigail Goldman, “Costco Job-Bias Lawsuit Advances,” Los Angeles Times, January 12, 2007, at C2.
30 550 U.S. 618 (2007).
31 42 U.S.C. § 2000e-2(a)(1).
32 Ledbetter v. Goodyear Tire & Rubber Co., 550 U.S. 618 (2007).
33 For more information on the Ledbetter decision, see CRS Report RS22686, Pay Discrimination Claims Under Title
VII of the Civil Rights Act: A Legal Analysis of the Supreme Court’s Decision in Ledbetter v. Goodyear Tire & Rubber
Co., Inc., by Jody Feder.

in the Senate. In the 111th Congress, H.R. 12 and S. 182 are identical to the version of H.R. 1338 th
that was passed by the House during the 110 Congress.
Under the EPA, as noted, prevailing plaintiffs may recover backpay in an amount equal to the
total difference between wages actually received and those to which they are lawfully entitled and 34
an additional amount equal to the backpay award as liquidated damages. Compensatory
damages are not authorized, and consequently, awards do not include sums for physical or mental 35th
distress, medical expenses, or other costs. As introduced in the 110 Congress, the Paycheck
Fairness Act would have authorized EPA class actions and “such compensatory and punitive
damages as may be appropriate.” In addition, the bill would have established more restrictive
standards for proof by employers of an affirmative defense to EPA liability based on any “bona
fide factor other than sex.” Thus, for a pay factor to be “bona fide,” the employer would have to
have established that it was “job related” or furthered a “legitimate business purpose,” and that
the employer’s purpose could not be accomplished by less discriminatory alternative means. As
passed by the House, the requirement in H.R. 1338 that employers’ bona fide factor defense must
further a “legitimate business purpose” was replaced by a requirement that such factor shall apply
only if it is consistent with “business necessity” and is not derived from a sex-based differential in th
compensation. As noted above, the version of the act under consideration in the 111 Congress, th
H.R. 12/S. 182, is identical to the version that passed the House in the 110 Congress.
The Fair Pay Act (H.R. 2019 and S. 1087 in the 110th Congress), which has predecessors dating rd
back to the 103 Congress, would go further by proposing a fundamental expansion to the scope
of the EPA, which is presently confined to sex-based wage differentials, by adding racial and
ethnic minorities as protected classes under that law. Intentional wage discrimination against
these groups is already prohibited by Title VII. But Title VII and the EPA have different standards
of proof, and because proof of intent to discriminate is not required by the “equal pay for equal 36
work” standard of the EPA, it may provide greater protection to minority groups than Title VII
in many cases. The EPA’s catchall exception, affording employers broad immunity for pay
differentials attributable to “factors other than sex,” would be significantly narrowed by the Fair
Pay Act. A compensatory and punitive damages remedy, without statutory limit, would replace
the present EPA backpay and liquidated damages scheme, based on the Fair Labor Standards Act.
Significantly, the Fair Pay Act would also redefine the basic statutory standard of the EPA by
requiring employers to pay equal wages regardless of sex, race, or national origin to workers in
“equivalent jobs.” Unlike the current law, Equal Pay Act claims based on wage disparities
between dissimilar jobs—e.g., a janitor and a clerk—would be permitted if they are determined to
be “equivalent” in some largely undefined manner. By substituting job equivalency for the “equal
work standard” in the EPA, the Fair Pay Act arguably could revive legal issues similar to those
confronted by the federal courts during the 1980s in so-called “comparable worth” Title VII
Another aspect of EPA enforcement addressed by proposed pay equity bills concerns employer
recordkeeping and the conduct of technical assistance, research, and educational programs by
federal agencies. For example, the Fair Pay Act would require all covered employers to maintain

34 29 U.S.C. §§ 216-17.
35 E.g. Hybki v. Alexander & Alexander, Inc., 536 F. Supp. 483 (W.D.Mo. 1982) (emphasizing damages for pain and
suffering are not available under the EPA).
36 See Fallon v. State of Illinois, 882 F.2d 1206 (7th Cir. 1989).

comprehensive records of “the method, system, calculations, and other bases used” to set
employee wages and to file annual reports with the Equal Employment Opportunity Commission
(EEOC) detailing the racial, ethnic, and gender composition of the employer’s workforce broken
down by job classification and wage or salary level. Such reports would be available for
“reasonable” inspection and examination upon request of any person, pursuant to EEOC
regulations, and could be used by the Commission for such “statistical and research purposes ...
as it may deem appropriate.” The EEOC would also be required to “carry on a continuing
program of research, education, and technical assistance” to implement the proposed ban on
racial, ethnic, or gender discrimination between employees working “in equivalent jobs.”
Likewise, the Paycheck Fairness Act would also mandate record-keeping and data collection for
better enforcement of the law. The measure would direct the EEOC to survey data currently
available to the government and, in consultation with sister agencies, to identify additional
sources of pay information that may be marshaled to support federal anti-discrimination efforts.
The EEOC would be required to issue regulations for the collection of pay data from employers
based on sex, race, and ethnicity, taking into consideration the burden placed on employers and
the need to protect the confidentiality of required reports. In addition, the Secretary of Labor
would be directed to develop job evaluation guidelines based on objective factors of education,
skill, independence, and decision-making responsibility for voluntary use by employers in
eliminating unfair pay disparities between traditionally male- and female-dominated occupations.
Technical assistance and a recognition program would be awarded to employers who voluntarily
adjust their wage scales pursuant to such a job evaluation. Finally, a “National Award for Pay
Equity in the Workplace” would be established to recognize employers who demonstrate
“substantial effort to eliminate pay disparities between men and women.” As passed by the House th
in the 110 Congress, H.R. 1338 did not include a previous requirement that the Secretary of
Labor develop guidelines that would help employers craft job evaluations enabling them to
compare different jobs with the objective of eliminating “unfair pay disparities” between
traditionally male- and female-dominated occupations. Instead, the employer award would not be
based on an employer’s adjustment of the establishment’s wage scales pursuant to the th
aforementioned job evaluation guidelines. As noted above, H.R. 12 and S. 182 in the 111 th
Congress are identical to the version of H.R. 1338 that was passed by the House during the 110
Finally, several bills that would have amended Title VII in light of the Supreme Court’s Ledbetter th
decision were introduced in the 110 Congress, but only H.R. 2831, the Lily Ledbetter Fair Pay
Act of 2007, was the focus of significant legislative action. Although the House passed H.R.

2831, the Senate did not. Currently, two companion bills—H.R. 11 and S. 181—have been th

introduced in the 111 Congress. The House passed H.R. 11 on January 9, 2009, and it has been
reported that the Senate will vote on the legislation during the week of January 12, 2009. As
passed by the House, H.R. 11 would clarify that the time limit for suing employers for pay
discrimination begins each time they issue a paycheck and is not limited to the original
discriminatory action.
Specifically, the bill states in part that:
an unlawful employment practice occurs, with respect to discrimination in compensation in
violation of this title, when a discriminatory compensation decision or other practice is
adopted, when an individual becomes subject to a discriminatory compensation decision or
other practice, or when an individual is affected by application of a discriminatory
compensation decision or other practice, including each time wages, benefits, or other
compensation is paid, resulting in whole or in part from such a decision or other practice.

This change would be applicable not only to Title VII of the Civil Rights Act, but also to the Age
Discrimination in Employment Act (ADEA), the Rehabilitation Act of 1973, and the Americans
with Disabilities Act (ADA).

Jody Feder Linda Levine
Legislative Attorney Specialist in Labor Economics, 7-8088, 7-7756