Paycheck Fairness Act Blocked Again

In light of the recent panel on the gender wage gap, I thought it would be useful to talk about the data access implications of recent blockage of the Paycheck Fairness Act.

You may not have realized that the recently blocked Act would have allowed the EEOC (eeoc.gov) to require employers to file pay data identified by the race, sex, and national origin of employees in an effort to enhance the commission’s ability to detect violations of law and improve enforcement of pay discrimination laws (the EEOC already collects data on the race, sex, and national origin of workers in 10 broad occupations in large private companies).

The Act would have also reinstated the  collection of sex-based data in the Current Employment Statistics survey and the Equal Opportunity Survey of federal contractors, a somewhat controversial survey implemented in November 2000 with goals to increase equal opportunity compliance, distribute resources to assist non-complying employers, and increase EEOC efficiency through better resource allocation.

The blockage of data collection is a huge loss for wage discrimination law enforcement.   There is already interest in regulated, systematic compensation data collection.  Last summer, the National Academy of Sciences and EEOC hosted a workshop that brought together experts in the Department of Justice, EEOC, OFCP, economic consulting, law, academia (including sociologist and OOW member Elizabeth Hirsh) to help the EEOC decide how it could collect compensation data  from employers.  Their report is due sometime this summer but without the backing of the Paycheck Fairness Act, it’s not clear if the EEOC will have the legal or monetary ability to enforce such data collection.

What is more, employers can legally compensate men and women in the same establishment doing jobs requiring the same skill, effort, and responsibility (which itself is pretty rare because of high levels of job sex segregation) differently if the pay difference is based on a seniority system, merit system, a system whereby pay is set based on quality or quantity of production, or on a differences based on any other factor other than sex (including, I suppose, one’s ability to negotiate a better salary or whether or not one is networked to the company CEO because they happen to play golf together on Saturday mornings).

Data collection alone is not a solution to end pay disparities, many of which are actually legal, but without the ability to track compensation across groups the EEOC can do little to remedy pay discrimination.

The data collection blockage is also a setback for OOW researchers who have very little (if any) access to employer-provide compensation data in a large sample of work establishments across industry.  Right now, most of us rely on individual worker accounts of compensation.  If we’re lucky, we can get worker’s estimates of their annual pay but we oftentimes have to settle for their pay reported in a range (e.g., $50,000-55,000).

Individual level data linked to EEOC compensation and demographic composition data could help us answer questions that have puzzled OOW scholars for decades, such as: To what extent do individual (e.g., human capital, sex, race/ethnicity) versus establishment (e.g., sex and race/ethnic composition) attributes affect pay?  Do shifts in the race/ethnic or sex composition of an occupation proceed or follow shifts in pay levels?  How do compensation levels change, if at all, with shifts in the demographic composition of upper management?   Do compensation levels change differently for non-managerial women and men when more women become part of upper management?

The debate over the existence and causes of the sex pay gap will not end even with access to compensation data from employers, but at least such data can inform the debate in ways we are unable to do now.