Robert J. O’Hara, Member of the Firm in the Employment, Labor & Workforce Management practice, in the firm’s New York office, was quoted in the Bloomberg Law Daily Labor Report, in “Spread of Pay Disclosure Laws Exposes Employers to Bias Suits,” by Chris Marr and Khorri Atkinson.
Following is an excerpt:
Efforts to improve pay equity by making salary amounts less secretive also heighten the risk of pay discrimination lawsuits for employers, including businesses operating in California or New York where salary disclosure bills await the governors’ signatures.
Those California and New York bills, like an existing law in Colorado and others taking effect soon in New York City and Washington state, would require companies to include a salary amount or range in job ads.
The measures are aimed at combating the gender pay gap and other forms of pay discrimination. Women workers in the US are estimated to receive 80 cents for every dollar that men of similar educational levels get paid.
Publicizing the pay ranges for new positions will let a company’s current employees see how their salaries compare—possibly leading some to conclude they’re being underpaid, perhaps confronting their bosses or ultimately pursuing legal action.
Employment attorneys urge businesses to prepare by evaluating pay scales, making adjustments where needed, and identifying the legitimate business reasons for differing pay amounts. …
Breaking the Secrecy Culture …
Robert J. O’Hara, of Epstein Becker & Green PC, echoed that pay range data could spark conversations about compensation between current employees. While that data could be used to bolster discrimination claims, he said it might not fully explain why a certain salary was offered to a new worker.
“It depends on the level of granularity of the data,” O’Hara said. “It will potentially give you an indication of where you fit within the organization’s pay structure.”
Nationwide Strategy
On top of the litigation risk, employers also face a possible hit to employee morale. …
Companies also could face high turnover, with the labor market still reeling from the consequences of the Covid-19 pandemic.
“The war for talent has heated up dramatically over the years and hasn’t reached its crisp yet, so the pressure is on and you usually entice people with pay,” O’Hara said.