Reasons Why Pay Equity Can Be Complicated In 2024

Why Pay Equity Can Be Complicated. If pay equity were simple, it probably would have been solved by now. And yet, more than 50 years after the Equal Pay Act of 1963 passed, our country is still grappling with how to close pay gaps for workers. Here’s more on why this ongoing issue is complicated to effectively address.

Reasons Why Pay Equity Can Be Complicated

Many People Still Deny The Existence Of Pay Gaps

The perception of the pay gap — and, therefore, the need or lack thereof for pay equity efforts — can complicate the situation. For instance, a study from Glassdoor found that seven out of 10 working adults believe women and men are paid equally for equal work. In this case, “perception doesn’t match up with reality.”

Without a clear understanding of what the data is saying in regard to gender and racial-based pay gaps, it can be difficult to spark change. This is particularly true if members of leadership teams within companies deny the existence of pay gaps; these individuals may be less likely to prioritize diversity efforts, get on board with pay equity efforts (like companywide audits) and play a role in forging an equitable company culture.

Training is one strategy organizations can use to present the facts and help decision-makers understand how their actions can positively contribute to pay equity. Of course, this type of education is especially useful for leaders with hiring and management duties.

Pay Equity Goes Beyond Legislation

We do have legislation in the U.S. meant to protect workers from discrimination on the basis of gender, race, age, disability, and more. In particular, the Equal Pay Act of 1963 requires equal pay for substantially equal work within the same company. While legal measures like this can prevent some discrimination. it is not capable of addressing one of the driving causes of the pay gap: the division of occupations by gender and race.

In other words, a major source of pay inequality isn’t just a disparity between what a man and a woman, or a white employee and a Black employee, might receive while having a similar job title. It also stems from the types of jobs workers have and how our society values those professions.

As one economist points out for CNBC, an incorrect understanding of the gender pay gap would be thinking women earn 80 percent less than men in the same position. Rather, “typically they work in different jobs.” Professions like teaching and nursing are disproportionately filled by women, for instance, whereas jobs like engineering are disproportionately filled by men.

These “pink-collar jobs,” like education, healthcare, social work, and many more, tend to pay lower wages than occupations dominated by men. Furthermore, there is still often a wage gap between the genders in these roles, further compounding the problem.

Another important consideration is intersectionality, particularly how race and gender interact to disadvantage women of color for than anyone else. Many of the lowest-paying sectors, like food service and personal aides, are filled by Latina and Black women — adding more fuel to the fire that is the wage gap in the U.S.

Legislation Is Not Always Consistent Around The Country

The Equal Pay Act of 1963 represents federal legislation to reduce payment discrimination against employees, but different states and cities have also enacted various pieces of legislation in the years since — often utilizing slightly different language — which means there’s not one consistent framework in place across the U.S. One expert calls these pay equity laws a “patchwork” that have sprung up out of growing pressure.

While it’s undoubtedly a good thing to see more locales taking serious measures to hold employers accountable for pay equity, the lack of consistency in regulations can make the waters choppy for companies and employees alike.

Above all, pay equity can be complicated because it’s a multifaceted issue stemming from more than one root cause — and thus will require multi-layered approaches to addressing it. Legislation is certainly a start, but not the end-all-be-all because it does not necessarily address occupational segregation. Furthermore, it’s an ongoing challenge to push back against people’s misconceptions and biases surrounding this hot-button issue.