Paycheck Fairness Act: More About Payback than Pay Equity
The Obama Administration's push for new pay-equity legislation — the so-called Paycheck Fairness Act — will, on the surface, sound reasonable to many people. But my cynical antenna is picking up the usual signals that indicate a certain political constituency is about to be rewarded for its support of the President and his party, and as usual businesses will be paying the price.
In this case, it's the trial lawyers that fund the campaigns of Democrats from coast to coast. I submit as evidence two provisions of the proposed bill that members of the trial bar no doubt applaud. One would limit the legitimate reasons employers can give in court for wage disparities, and the other would prevent employers from retaliating against employees who discuss their wages. Can you say "red flags?"
Hmmm. The bill acknowledges there are legitimate reasons for pay disparities, but they want to reduce the number anyway. That's just great. Does anybody really have to ask why job creation is suppressed in this country?
As for not retaliating against employees who need a zipper in their mouths, talking (more likely bragging) about your pay has long been considered bad form. Given the importance of organizational morale, employers do have an interest in keeping petty jealousies to a minimum, and that's true of women and men who might envy someone else's compensation.
In trying to make the case for the bill, White House Senior Advisor Valerie Jarret said: "Women deserve equal pay. It's a very fundamental right."
Hold on, Val. Not every woman deserves equal pay, nor does every man. There is a lot that goes into that calculation, including experience, education, ability, judgment, people skills, and sheer production. I'm not going to pretend that I deserve to be compensated as well as my publisher, Jody Glynn Patrick, even though some of our duties overlap. I won't go into the reasons because they could fill a book, let alone a column.
As they say, compensation is something that should be judged on a case-by-case basis, which means sometimes women command greater compensation than their male counterparts.
Trial Bar ROI
Of course, it's right to put gender-based wage discrimination on par with other forms of wage discrimination, including race-based compensatory bias. But that's not the real focus of this bill. In fact, that's the smoke screen. The trial bar has given millions of dollars to politicians, and its members fully expect some ROI for that investment.
It doesn't matter whether cases brought are legitimate and easily dismissed in Court. Employers will have to fork over more of their cash just to defend themselves, no matter what the merits of the case. That's money that could be used for more hires, better wages FOR MEN AND WOMEN WHO EARN THEM, and better benefits, or at least to avoid the erosion of benefits.
A primary reason that businesses aren't creating more jobs, and why there is a lot of money just sitting on the investment sidelines, is that the people who put their money at risk to run companies are wondering what government-imposed costs are coming next. A growing number of those people just happen to be women, which should tell you that that today's private sector is fully capable of closing any wage gap without government's benevolent assistance.
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