BILL SUMMARY
This bill revises various present law provisions regarding wage discrimination.
Under present law, wage differentials between employees of the opposite sex are permissible only if such differentials are based on a system of seniority, merit, quality, or quantity of production, or any “other reasonable differential” that is based on a factor other than sex. This bill restricts the “other reasonable differentials” mentioned in present law to those based on a bona fide factor such as education, training, or experience. Further, this bill requires the employer to demonstrate that:
(1) The factor is job-related with respect to the position in question, not based on or derived from a sex-based differential in compensation, and is consistent with a business necessity;
(2) The factor is applied and used reasonably in light of the asserted justification; and
(3) One or more factors relied upon account for the entire wage differential.
This bill removes the present law provision prohibition on employers discharging or discriminating against employees for taking action to enforce current pay equity standards (it should be noted that present law has separate retaliatory discharge laws that apply generally). This bill prohibits employers from prohibiting, discharging, or discriminating against employees who inquire about, discuss, or otherwise disclose wages of the employee or another employee. This bill also prohibits employers from requiring an employee to sign a waiver or document denying the employee of the employee’s right do so. This bill states that an employer or employee is not required to disclose the amount of wages paid to an employee.
This bill requires the commissioner of labor and workforce development to develop guidelines for employers to evaluate job categories based on objective criteria so that the employers may voluntarily compare wages paid for different jobs and determine if the pay scales adequately and fairly compensate men and women.
Under present law, those employers who violate the wage discrimination laws are liable to the employees affected in the amount of their unpaid wages. Where violations are committed knowingly, up to an additional equal amount of unpaid wages may be awarded as liquidated damages. On a second distinct violation, the employer is liable for up to an additional two times the amount of unpaid wages as liquidated damages for a knowing violation. On a third distinct violation, the employer is liable for up to an additional three times the amount of unpaid wages as liquidated damages for a knowing violation. A court may also assess reasonable fees and costs of the action to the defendant.
Under this bill, employers, will additionally be liable for any compensatory or punitive damages deemed appropriate, except that the federal and state government and their political subdivisions will not be liable for punitive damages.