Equal Pay Act of 1963

Find Out How This Law Protects You

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The Equal Pay Act (EPA) became law in 1963 as an amendment to the Fair Labor Standards Act (FLSA). It mandates employers pay workers substantially equal pay for performing the same job regardless of their gender.

The EPA not only covers salary, but also overtime pay, bonuses, and benefits like stock options, profit sharing, life insurance, health insurance, and vacation and holiday pay. An employer is not allowed to provide different hotel accommodations or reimbursement for travel expenses for their male and female employees.

Additional U.S. laws that protect workers from employment discrimination, including compensation discrimination, are Title VII of the Civil Rights Act, the Age Discrimination in Employment Act, and the Americans With Disabilities Act. Some states may have laws that prohibit pay discrimination.

Equal Pay for Equal Work

To better understand the Equal Pay Act, it is helpful to know the definition of "substantially equal work." "Substantially equal" does not mean that two jobs are identical. They must involve a significant number of the same tasks and require comparable skill level in terms of ability, education, experience, and training.

When Is Unequal Pay Okay?

When the following factors exist, work cannot be considered "substantially equal." Therefore the mandate that employers must give equal pay to two workers regardless of gender does not apply in these cases.

  • There can be a pay differential for higher educational attainment even if two workers perform similar job duties. For example, if one worker has a graduate degree, for example, and the other has a bachelor's degree, the one with the higher level of education could earn a higher salary.
  • An employer could also give a higher salary to a worker based on their job location. The work would not be considered "substantially equal" unless the same manager oversees their work or they can easily transfer between sites. Employees working in two different cities could receive different salaries.
  • Jobs without similar levels of accountability and responsibility do not have to pay the same. For example, a worker who supervises other employees can get a higher salary than one who does not, even if both individuals have the same job title.
  • If one worker must travel between job sites while another can work in the home office every day, their jobs differ substantially. The one who must go to different locations can earn more.
  • Employers can have a seniority system in place that rewards workers for longevity with the organization.
  • Merit systems reward workers for exceptional job performance and are allowed.
  • Employers can also provide an incentive to workers for the quality or quantity of their output without violating the Equal Pay Act.
  • Employees who work during less desirable shifts may also have higher earnings.

What to Do If Your Boss Violates the Equal Pay Act

While it seems only fair that people performing similar work for the same organization should have the same earnings, many employers try to do the complete opposite. If you feel your boss has violated the Equal Pay Act, you can either bring a lawsuit against the company in court or file a charge with the Equal Employment Opportunity Commission (EEOC), the government agency that oversees the Equal Pay Act. Whether filing a charge with the EEOC or taking the company to court, you must do so within two years of the time the compensation discrimination took place.

In 2018, the EEOC received 1,066 complaints about employers violating the EPA. Of these, there were 257 merit resolutions. That means they had outcomes that were favorable to the charging parties.

The EEOC may have found there wasn't reasonable cause to pursue the other claims, but that does not mean the charging parties did take their charges to court where they may have won favorable judgments.

Source: Equal Employment Opportunities Commission.