The latest effort to pass the “Paycheck Fairness Act” has stalled in the U.S. Senate. The current version of the bill would make various changes to the portions of the Fair Labor Standards Act known as the Equal Pay Act. Currently, the Equal Pay Act prohibits employers from paying members of one sex a lower wage than members of the other sex for doing the same work. The Paycheck Fairness Act would, among other things, make it more difficult for employers to avoid liability for sex-based pay differentials, add prohibitions against retaliation for discussing or inquiring about wage rates, and increase penalties for violations. Democrats had previously tried and failed to pass a similar bill in 2010. (For additional information, see Legal News: Employment Law Update February 6, 2012 related to wage gap. On June 5, 2012, Senate Democrats sought to move the bill to debate, but the motion was defeated by a vote of 52 to 47. The defeat derailed the bill, at least for the time being, although its supporters have indicated they may try to push the bill forward again in the future.Although the Paycheck Fairness Act has been stopped for now, employers should remember that the Equal Pay Act remains in full force and effect. In fact, the day after the Senate vote, the federal Eighth Circuit Court of Appeals issued a decision involving an Equal Pay Act claim. The court held that the Equal Pay Act imposes a “strict liability” standard on employers. Under this standard, a plaintiff does not need to show that the employer acted with discriminatory intent, but need only prove that she was paid less than similarly situated men. The burden then shifts to the employer to prove that any pay disparity is justified by a seniority system, a merit system, a pay system based on quantity or quality of output, or is based on another factor other than sex.
Although the Paycheck Fairness Act has stalled, we may not have seen the end of the effort to toughen federal standards governing allegations of sex-based pay differentials. However, even in the absence of any new legislation, the Equal Pay Act’s “strict liability” standard will continue to give employees a potent weapon to attack perceived sex discrimination in pay rates.