United States: The Pay Gap, The Glass Ceiling, And Pay Bias: Moving Forward 50 Years After The Equal Pay Act

I. INTRODUCTION

When the Equal Pay Act ("EPA") became law in 1963, women earned approximately 59 cents for every dollar a man earned.¹ Women today are earning roughly 80 cents on the dollar.² While the past 50 years have seen extraordinary progress for women, the persistence of a 20 percent gender pay gap, coupled with the rapidly growing population of women in the workforce, has caused the government to reinvigorate its efforts to enforce and strengthen pay discrimination laws. While eliminating pay bias is important, focusing heavily on perceived employer bias obscures a much more complex web of factors contributing to the problem of pay differences between men and women.

Indeed, the pay gap measures only the difference in average earnings between all men and all women; it is not a proxy for pay bias—i.e., the failure to pay women equal pay for equal work.³ The pay gap says nothing about gender disparities within specific professions or positions. It fails to account for differences in chosen profession, education, work patterns, and work experience, among other factors.⁴ The pay gap is also driven in large part by the glass ceiling—the barrier keeping qualified women from rising to the upper rungs of the professional ladder.⁵ Women remain significantly underrepresented among the top ranks of business, finance, academia, and government.⁶ Studies consistently show that the concentration of women in low-paying jobs, and occupational selections—the actual position a woman selects within an industry—are two key drivers of the pay gap.⁷ Studies also demonstrate that while women make less money than men, they also work fewer hours each year, have more work interruptions, and spend more time doing unpaid work than their male counterparts. These work patterns, which contribute to lower wages for women, also inhibit women's rise to highest levels of their professions—particularly given the increasing proportion of high-earning individuals who work 50 hours per week or more.⁸ Tackling the pay gap means understanding the glass ceiling as well.

Instead of a "crack down"⁹ on employers—which presumes that discrimination is the primary cause of the pay gap and the glass ceiling—more time should be spent understanding the problem. This is not to suggest that bias does not exist or diminish the importance of eliminating it. However, it is equally important to recognize that women are making life and occupational decisions based on competing demands for their time and other personal, individualized interests, many of which are industry-specific. Whether these decisions are voluntary "choices" or fueled by implicit or overt bias is extraordinarily difficult to discern and varies greatly from woman to woman, employer to employer, and job to job.

Therefore, solutions cannot fit into a one-size-fits-all mold. Placing blame on employers and focusing narrowly on antidiscrimination legislation ignores a broader problem based on deeply entrenched societal assumptions related to how we collectively define our roles as women and men. However, dictating what roles any given person should play at any given time extends well beyond the purview of legislators, judges, and juries. Addressing the pay gap and the glass ceiling requires engaging in a social dialogue to find innovative and creative solutions to reconcile various important competing interests for employees and businesses alike. A viable solution demands a holistic approach.

II. THE HISTORY OF THE EPA AND PAY BIAS LAWS

On June 10, 1963, President Kennedy signed the EPA and pointed to the pay gap as the driving force: "[T]he average woman worker earns only 60 percent of the average wage for men . . . . Our economy today depends upon women in the labor force. . . . It is extremely important that adequate provision be made for reasonable levels of income to them, for the care of the children . . . and for the protection of the family unit."¹⁰

While the EPA was passed in an effort to narrow the pay gap, its focus was targeted at pay differences between men and women doing the same job. As the U.S. Supreme Court explained in Corning Glass Works v. Brennan:

Under the EPA, women have the right to sue their employers for disparate pay for equal work.¹² The EPA also gives the Equal Employment Opportunity Commission ("EEOC") enforcement authority over EPA violations, whereby the government can initiate directed investigations of employers and pursue claims even if individual workers are reluctant to pursue their rights under the EPA.¹³

To prevail on an EPA claim, a plaintiff must prove that she received unequal pay for performing a job that requires (1) equal skill; (2) equal effort; (3) equal responsibility, and which is (4) performed under equal working conditions to that of a male comparator's more highly compensated job.¹⁴ In evaluating whether two jobs are equal under the EPA, "equal means substantially equal."¹⁵ Indeed, Congress chose the word "equal," not the word "comparable," in the language of the statute.¹⁶ Accordingly, courts consider whether two positions share a "common core of tasks," rather than looking superficially at job titles or descriptions.¹⁷ Being similar, or comparable, is not enough; the relevant inquiry is whether work is equal.¹⁸ Employers can defeat an EPA claim by showing that pay disparities are based on seniority, merit, quantity or quality of production or "a factor other than sex."¹⁹ If the employer proves one of these affirmative defenses, the burden then shifts back to the employee to show that the employer's proffered reasons for the wage difference are actually a pretext for discrimination.²⁰

Shortly after Congress passed the EPA, it passed Title VII of the Civil Rights Act of 1964, which provides more comprehensive protection against discrimination. It prohibits sex discrimination in hiring, promotion, or "with respect to the compensation, terms, conditions, and privileges of employment . . . ."²¹ The law prohibits discrimination in the form of sexual harassment, hostile work environment, and pregnancy discrimination.²² It also forbids employers "to limit, segregate, or classify his employees" in a way that could adversely affect their status at work, or deprive them of employment opportunities.²³ Title VII has a much broader impact on pay discrimination claims because it is not limited to claims of equal pay for "equal work." Rather, an employee's Title VII claim can survive even when no member of the opposite sex holds an equal but higher paying job, provided that the pay differential is not attributable to seniority, merit, quantity or quality of production, or "any other factor other than sex."²⁴ However, Congress did incorporate into Title VII the affirmative defenses available under Section 206(d) of the EPA.²⁵

Executive Order 11246 also prohibits discrimination by any company with a federal contract or subcontract exceeding $10,000. EO 11246 requires contractors to take affirmative steps to ensure equal employment opportunity and establishes rigorous record keeping requirements about employment actions.²⁶ The Department of Labor's Office of Federal Contract Compliance Programs ("OFCCP"), which administers EO 11246, also investigates employers pursuant to Title VII—which means OFCCP audits are not limited by the scope of the EPA.²⁷

III. THE GOVERNMENT "CRACKDOWN"²⁸ TO ADDRESS THE PAY GAP

A. A Focus on Bias

President Obama ran for election in 2008, in part, on a promise to substantially strengthen the nation's existing antidiscrimination laws regarding pay bias against women to further narrow the pay gap. He partially delivered on that promise when in 2009 he signed into law, as his first piece of legislation, the Lilly Ledbetter Fair Pay Act amending Title VII.²⁹ However, subsequent efforts at enacting additional antidiscrimination pay legislation stalled. Notably, the Paycheck Fairness Act ("PFA")—a proposed amendment to the EPA—fell just two votes short of the sixty required to proceed on a cloture vote in the Senate.³⁰ The Obama Administration then shifted its efforts to more aggressive enforcement of existing pay discrimination laws and regulations by pushing federal agencies to dramatically step up their class and "systemic discrimination" enforcement efforts.³¹

To harness existing laws, the President created the National Equal Pay Task Force ("Task Force") in February 2010 and tasked it with coordinating efforts of the EEOC, Department of Justice ("DOJ"), Department of Labor ("DOL"), and Office of Personnel Management ("OPM").³²

The White House issued its most recent Task Force report in June 2013. The report, titled Fifty Years After the Equal Pay Act, provides a broad overview of pay issues, including the pay gap and pay bias.³³ The report includes a lengthy discussion of the economics, politics, and demographics surrounding pay issues in the workplace.³⁴ In discussing "the way forward," the report focuses heavily on the assumption that discrimination is the primary driver of the remaining pay gap. It reiterates the government's determination to better enforce existing civil rights laws, in part through encouraging the EEOC, OFCCP, and the DOJ to collaborate on enforcement work, and by collecting employee data in an effort to expose alleged discrimination. The report also reaffirms a pledge President Obama took before taking office to pass the PFA, purportedly to "address the current loopholes in existing law" and "strengthen remedies for pay discrimination."³⁵ In addition, the report highlights the need to "break down discriminatory barriers that exclude women from traditionally male-dominated occupations, which pay more than traditionally female occupations."³⁶ Finally, the report briefly mentions the need to address "the problem of discrimination based on stereotypes about the proper role of women and mothers."³⁷ Employer bias is the common, almost exclusive theme of the report.

B. The Results of the Government's Enforcement Efforts Suggest Factors Other Than Bias Are at Play

The government's theme, however, is somewhat inconsistent with the results of the EEOC's efforts to find and eliminate pay bias since 1978 when the EEOC was granted authority to be the federal government's lead agency for enforcing the country's federal antidiscrimination laws. In the first decade after the EPA was passed in 1963, there was substantial enforcement by the DOL's Wage & Hour Division.³⁸ However, since the EEOC began enforcing the EPA, there has been virtually no significant government litigation or findings of employer bias under the EPA. During the 25 year period from 1985 to 2010, there are no reported cases arising out of EPA-directed investigations by the EEOC resulting in a decision on the merits.³⁹

The government's efforts and results since the White House established the Task Force in January 2010 show a similar lack of enforcement under the EPA. According to the 2013 Task Force report, the EEOC recovered "over $78 million in relief for victims of sex based wage discrimination through administrative enforcement."⁴⁰ The report offers no other detail. It fails to explain whether the relief addressed actual pay bias—that is, unequal pay for equal work based on an employee's gender—or other more nuanced forms of discrimination, since it fails to identify which statutes were allegedly violated (e.g., EPA, Title VII, ADEA or ADAAA).

Further inquiry to the EEOC suggests that its recent administrative enforcement efforts were not based on the EPA. In response to a FOIA request filed by the authors on November 29, 2012, regarding the EEOC's pursuit of EPA matters, EEOC responded with the chart below, reporting the EEOC's activity during the fiscal years 2007 through 2011. As the chart shows, EPA charge filings by individuals dropped by more than half in 2010 and 2011, and EPA administrative enforcement by the EEOC has been virtually nonexistent.

Equal Employment Opportunity Commission
EEOC Receipts
Charges Files FY2007 – FY2011

EPA Charges

The White House report offers slightly more detail on OFCCP's enforcement results. During the same period (January 2010 through March 2013), OFCCP "reviewed the pay practices of over 14,000 business . . . and closed more than 80 compliance evaluations with financial settlements remedying pay discrimination on the basis of gender and race."⁴¹ Put differently, despite having the authority to audit government contractors based on the much broader prohibitions of Title VII, OFCCP found pay bias in less than one percent of the contractor compliance reviews it has conducted since creation of the President's National Equal Pay Task Force.

Thus, despite a strong push from the President, the results of the Task Force agencies in the past three years do not reveal the number of violations that one would expect if employer pay bias were currently the overwhelming driving force behind the gender pay gap in the American workplace. This is not to say that there is no pay bias. But it at least suggests that the pay gap warrants a look at other potential causes.⁴²

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Footnotes

* Authored by Gary Siniscalco, Lauri Damrell, and Clara Morain Nabity. Mr. Siniscalco is a partner in the employment law group in Orrick, Herrington & Sutcliffe LLP's San Francisco office. Mr. Siniscalco has a national practice that focuses on litigating complex employment law cases and client counseling. In 2009, Mr. Siniscalco was rated by International Who's Who Legal as one of the top 10 management and labour lawyers in the United States. He was formerly Regional Counsel and Senior Trial Attorney for the United States Equal Employment Opportunity Commission (EEOC) in San Francisco. He has extensive expertise in EEO, affirmative action, wrongful discharge, and wage-and-hour matters. Email: grsiniscalco@orrick.com.

Ms. Damrell is a senior associate in Orrick's Sacramento office. Ms. Damrell represents and counsels employers in a variety of complex employment law matters, with a focus on discrimination and wage-and-hour issues. She frequently publishes articles on topics relevant to diversity in the workforce and recently spoke on a panel at the U.S. Capitol providing her legal expertise on the Paycheck Fairness Act. Ms. Damrell is an active member of the ABA Committee on Equal Employment Opportunity Law and the National Association of Women Lawyers. She is also a co-founder of the Mother Attorneys Mentoring Association of Sacramento (MAMAS). Email: ldamrell@orrick.com.

Clara Morain Nabity is a third-year student at UC Hastings College of the Law. She was a summer associate at Orrick, Herrington & Sutcliffe in 2013 and will join the firm after graduation.

1 Dep't of Labor, Fact Sheet: Closing the Gender Wage Gap, Equal Pay Tool Kit, http://www.dol.gov/wb/equal-pay/WH-Equal-Pay-fact-sheet.pdf (last visited Aug. 30, 2013).

2 See, e.g., Ariane Hegewisch & Hannah Liepmann, Inst. for Women's Policy Research, IWPR #C350a, The Gender Wage Gap by Occupation (Apr. 2010), available at http://www.iwpr.org/publications/pubs/the-gender-wage-gap-by-occupation.

3 See, e.g., U.S. Gov't Accountability Office, GAO-12-10, Gender Pay Differences: Progress Made, but Women Remain Overrepresented among Low-Wage Workers 2 (Oct. 2011) (hereafter, GAO 2011 Study).

4 Hegewisch & Liepmann, supra note 2. See also CONSAD Research Corporation, An Analysis of the Reasons for the Disparity in Wages Between Men and Women, Final Report Prepared for U.S. Dep't of Labor (Jan. 2009), available at http://www.consad.com/content/reports/Gender%20Wage%20Gap%20Final%20Report.pdf (hereafter CONSAD Report). See generally National Center for Education Statistics, digest of education Statistics, Tables 313-334, available at http://nces.ed.gov/programs/digest/d11/tables_3.asp (last visited Sept. 4, 2013) (reflecting disparities in number of men's and women's degrees in various areas of study).

5 Fed. Glass Ceiling Comm'n, A Solid Investment: Making Full Use of the Nation's Human Capital (Nov. 1995), available at http://www.dol.gov/dol/aboutdol/history/reich/reports/ceiling2.pdf. The term glass ceiling first appeared in a 1984 article in Adweek about magazine editor Gay Bryant's decision to change jobs from editor of Working Woman to editor of Family Circle. She explained, "Women have reached a certain point -- I call it the glass ceiling. They're in the top of middle management and they're stopping and getting stuck. There isn't enough room for all those women at the top. Some are going into business for themselves. Others are going out and raising families." Nora Frenkiel, The Up-and-Comers; Bryant Takes Aim At the Settlers-In, Adweek. (Mar. 1984). The term was ultimately formalized when Title II of the Civil Rights Act of 1991 created a 21-member, bipartisan Federal Glass Ceiling Commission. In its November 1995 report, the Commission defined glass ceiling as "the unseen, yet unbreachable barrier that keeps minorities and women from rising to the upper rungs of the corporate ladder, regardless of their qualifications or achievements." Fed. Glass Ceiling Comm'n at 4.

6 See, e.g. Bureau of Labor Statistics, Table 11: Employed Persons by Detailed Occupation, Sex, Race, and Hispanic or Latino Ethnicity 2012, Labor Force Statistics from the Current Population Survey, http://www.bls.gov/cps/cpsaat11.pdf (last visited Aug. 28, 2013). See also Deborah L. Rhode, The Subtle Side of Sexism, 16 Colum. J. Gender & L. 613 (2007) (noting women hold 25 percent of upper-level state governmental positions; 16 percent of congressional seats; less than 25 percent of top academic positions; 2 percent of Fortune 500 CEOs; less than 20 percent of law firm partners; and 16 percent of board directors and corporate officers); Frank Bass, Shining Shoes May Be Best Way Wall Street Women Outearn Men, Bloomberg (Mar. 16, 2012, 1:01 PM), http://www.bloomberg.com/news/2012-03-16/shining-shoes-best-way-wall-street-women-outearn-men.html (one reason women in the financial sector earn less than men is the fact that many work in lower-paying positions—public finance rather than trading, for example); Catalyst, Inc., Catalyst Quick Take: Women in Management in the United States, 1960-Present. Catalyst Knowledge Center (Mar. 27, 2013), http://www.catalyst.org/knowledge/women-management-united-states-1960-present#footnote5_og5t98q.

7 See Section IV, infra.

8 Sylvia Ann Hewlett & Carolyn Buck Lee, Extreme Jobs: The Dangerous Allure of the 70-Hour Workweek, Harv. Bus. Rev. (Dec. 2006), http://hbr.org/2006/12/extreme-jobs-the-dangerous-allure-of-the-70-hour-workweek/ar/1.

9 During his January 27, 2010 State of the Union address, President Obama pledged "to crack down on violations of equal pay laws—so that women get equal pay for an equal day's work." The White House Office of the Press Sec'y, Remarks by the President in the State of the Union Address (Jan. 27, 2010, 9:11 PM), http://www.whitehouse.gov/the-press-office/remarks-president-state-union-address.

10 21 Cong. Q. 978 (1963).

11 Corning Glass Works v. Brennan, 417 U.S. 188, 195 (1974), citing S. Rep. No. 88-176, at 1 (1963).

12 29 U.S.C. § 206(d)(1) (2012).

13 29 U.S.C. §§ 209, 211 (Fair Labor Standards Act provisions authorizing investigations and enforcement of the Equal Pay Act. All functions related to enforcement and administration of 29 U.S.C. § 206(d) (The Equal Pay Act), including but not limited to the functions related to administration and enforcement formerly vested in the Secretary of Labor, Wage and Hour Division of the Department of Labor were transferred to the EEOC by Section 1 of the 1978 Reorg Plan No. 1, 43 Fed. Reg. 19807 (May 9, 1978), 92 Stat. 3781, set out in appendix 1 to Title 5, Government Organization and Employees. See also EEOC Regulations at 29 C.F.R. 1620.30 (2013).

14 29 U.S.C. § 206(d)(1) (2012).

15 See, e.g., Shultz v. Wheaton Glass Co., 421 F.2d 259, 265 (3d Cir. 1970); see also Wheatley v. Wicomico Cnty., 390 F.3d 328, 332 (4th Cir. 2004).

16 Brennan v. City Stores, Inc., 479 F.2d 235, 238 (5th Cir. 1973); Waters v. Turner, Wood and Smith Ins. Agency, Inc., 874 F.2d 797, 799 (11th Cir. 1989); EEOC v. Madison Community Unit School Dist., 818 F.2d 577, 582 (7th Cir. 1987); Wheatley, 390 F.3d at 333.

17 See, e.g., Merillat v. Metal Spinners, Inc., 470 F.3d 685, 695 (7th Cir. 2006) ("In order to determine whether or not the two jobs are equal, we look to whether the jobs have a common core of tasks, i.e., whether a significant portion of the two jobs is identical." (internal quotation marks omitted)).

18 See id.; Lang v. Kohl's Food Stores, Inc., 217 F.3d 919, 923 (7th Cir. 2000) ("proof that the two jobs are of the same (or comparable) value . . . gets the plaintiff nowhere. To succeed under the Equal Pay Act the plaintiff must establish that the positions entail substantially equal tasks, performed under similar conditions.").

19 29 U.S.C. § 206(d)(1).

20 See Ryduchowski v. Port Authority of New York and New Jersey, 203 F.3d 135, 142 (2d Cir. 2000).

21 42 U.S.C. § 2000e-2(a)(1) (2012).

22 42 U.S.C. § 2000e, et seq. (2012).

23 42 U.S.C. § 2000e-2(a)(2) (2012).

24 Washington Cnty. v. Gunther, 452 U.S. 161, 168 (1981).

25 42 U.S.C. § 2000e-2(h) (2012).

26 Exec. Order No. 11246, 30 Fed. Reg. 12319 (Sept. 28, 1965), 12935 3 C.F.R. 339 (1964-1965).

27 OFCCP Directive No. 307 (Feb. 28, 2013)., available at http://www.dol.gov/ofccp/regs/compliance/directives/Dir307_508c.pdf.

28 See Mona Sutphen, Putting Washington at the Service of the Middle Class, The White House Rural Council (Jan. 27, 2010, 10:23 PM), http://www.whitehouse.gov/blog/2010/01/27/putting-washington-service-middle-class ("We're going to crack down on violations of equal pay laws-–so that women get equal pay for an equal day's work.").

29 Lilly Ledbetter Fair Pay Act of 2009, Pub. L. No. 111-2, 123 Stat. 5 (2009).

30 Govtrack.us, S. 3772 (111th Congress, 2009-2010): Paycheck Fairness Act, Govtrack.us, http://www. govtrack.us/congress/bills/111/s3772 (last visited Aug. 28, 2013).

31 See Nat'l Equal Pay Task Force, Equal Pay TaskForce Accomplishments: Fighting for Fair Pay in the Workplace (April 2012), available at http://m.whitehouse.gov/sites/default/files/equal_pay_task_ force.pdf.

32 Id.

33 See generally The White House Report, White House National Equal Pay Task Force, Fifty Years After the Equal Pay Act: Assess the Past, Taking Stockof the Future 5-23 (June 2013), available at http://www.whitehouse.gov/sites/default/files/image/image_file/equal_pay-task_force_progress_report_june_10_2013.pdf.

34 See generally Nat'l Equal Pay Task Force, Fifty Years After the Equal Pay Act: Assess the Past, Taking Stockof the Future 5-23 (June 2013), available at http://www.whitehouse.gov/sites/default/files/image/image_file/equal_pay-task_force_progress_report_june_10_2013.pdf.

35 Id. at 34.

36 Id.

37 Id. at 35.

38 See Albert H. Ross & Frank V. McDermott, Jr., The Equal Pay Act of 1963: A Decade of Enforcement, 16 B.C. L. Rev. 1, 10 (1974), available at http://lawdigitalcommons.bc.edu/bclr/vol16/iss1/1.

39 See Maurice Wexler, et al., The Law of Employment Discrimination from 1985 to 2010, 25 A.B.A. J. Lab. & Emp. L349, 383 (2009-2010).

40 See Nat'l Equal Pay Task Force, Fifty Years After the Equal Pay Act: Assess the Past, Taking Stockof the Future 33 (June 2013), available at http://www.whitehouse.gov/sites/default/files/image/image_file/equal_pay-task_force_progress_report_june_10_2013.pdf. This seems insubstantial for these years of efforts by the EEOC since the Task Force was created.

41 Id. at 33 (emphasis added).

42 It bears mentioning that in the EEOC's initial draft of its Strategic Enforcement Plan ("SEP") for 2012-2016, which it released in September 2012, equal pay did not make the EEOC's list of five national priorities. See U.S. Equal Emp't Opportunity Comm'n, Draft Strategic Plan For Fiscal Years 2012 – 2016, http://www.eeoc.gov/eeoc/plan/strategic_plan_12to16_DRAFT.cfm (last visited Aug. 28, 2013). Not until the EEOC released the final version of the SEP in December 2012 did equal pay become the sixth priority. U.S. Equal Emp't Opportunity Comm'n, Strategic Enforcement Plan FY 2013 – 2016, http://www.eeoc.gov/eeoc/plan/sep.cfm (last visited Aug. 28, 2013).

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