In the wake of the #MeToo movement, pay equity between men and women is an issue arising more frequently in both the courts and the media. New Jersey recently addressed discriminatory pay disparities in the Diane B. Allen Pay Equity Act of 2018, which revises the New Jersey Law Against Discrimination (the “LAD”) to prohibit unequal pay based not only on gender, but on any “protected class” under the LAD. The following is a brief overview of the most important impacts of the law and its relevance to being paid less than a coworker for similar work.
What kind of pay disparities are illegal under the LAD?
As mentioned above, the LAD now prohibits pay disparities for “substantially similar” work, when such disparities are based on gender, race, age, sexual orientation, national origin, or any other “protected class” as defined by the LAD.
What is “substantially similar” work?
The law doesn’t define “substantially similar”, except to say that the employees’ skills, effort and responsibility are taken into consideration. Given this vagueness, you can expect for the courts to decide what constitutes “substantially similar” work on a case-by-case basis. As always, the devil will be in the details.
Even so, as a practical matter, the following factors are indicative of “substantially similar” work:
- Same job title
- Same department or division (even across the company or organization)
- Same day-to-day duties and level of supervision
Are there any circumstances where employers may pay workers differently?
The law does give the boss limited exceptions that allow for unequal pay for substantially similar work. Pay disparities are excused when:
- They result from a seniority or merit system. For example, a school district may legally pay a female high school math teacher with 6 years’ experience less than a male high school math teacher with 12 years’ experience.
- They result from a legitimate, bona fide business reason articulated by the employer. Again, the courts will likely have to weigh in on what, exactly, amounts to a “legitimate” reason for pay differences. However, the law specifies that training, education and experience, and the quantity and quality of production may qualify as bona fide reasons for unequal pay. For example, between two budget analysts with the same job title, the analyst with, say, 50% less errors or 50% more reports completed on time would likely be allowed more pay.
Can I ask my co-workers what they make for comparison?
Yes – in fact, the Pay Equity Act makes it unlawful for your employer to prohibit you from, or retaliate against you for, inquiring about what your co-workers are paid for performing substantially similar work.
What are the extent of my damages for unequal pay?
The Pay Equity Act authorizes a claimant to sue for lost pay extending back six years, but no further back than July 1, 2018, the Act’s effective date. In calculating this six-year “look-back” period, it’s important to note that each paycheck qualifies as a separate instance of pay discrimination giving rise to a claim.
Moreover, under the Act, successful claimants are entitled to treble damages – in other words, three times the difference between what the claimant should have been paid but-for the pay discrimination, and what the claimant was actually paid, during the six-year period.
Have more questions?
The Pay Equity Act is a relatively untested recent addition to the Law Against Discrimination. If you are concerned that you are being paid less than your co-workers due to discrimination, call our offices today for a free consultation.
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