1. Running head: THE EQUAL PAYMENT ACT 1
The Equal Payment Act
Joseph Feldman
Brandman University
Legal Issues in Human Resources
HRCU 648
June 14, 2015

2. THE EQUAL PAYMENT ACT 2
The Equal Payment Act
Introduction
The purpose of this paper to analyze the effects of the Equal Payment Act of 1963 (EPA)
on organizations and employees, and to make recommendations that will help both parties in
compliance and non-compliance areas. A review of the EPA will be given along with subsequent
amendments to the law that have strengthen its position. Part of this paper will discuss recent
EPA violations from Citibank and True Oil LLC. Unequal payment amongst men and women for
similar work is a serious problem that HR divisions must look at in terms of compliance as it is
considered a form of gender discrimination. Protecting equal pay is an ever increasing concern as
a rise in women participation labor rates have occurred over the past few decades.
Overview of the Equal Payment Act of 1963
The passage of the EPA in 1963 was to help enforce “men and women in the same work
place be given equal pay for equal work” (Whitehouse.gov., n.d., p. 1). Subsequent laws that
have strengthened the meaning and protection of equal pay for women include Title VII of the
1964 Civil Rights Act and The Lilly Ledbetter Fair Pay Act of 2009 (Ledbetter Act). According
to Nolo.com (2015) “Title VII goes beyond ensuring equal pay to barring discrimination in all
aspects of employment, including hiring, firing, promotion, and more” (p. 1). The Ledbetter Act
was President Obamas very first signed piece of legislation that attempted to curb the gender pay
gap. According to Covert (2014) “the act gave people who experience pay discrimination more
time to file a complaint” (p. 1).
Effects on Employees
In 2012 the Whitehouse issued a report stating “full-time women workers’ earnings are
only about 77 percent of their male counterparts’ earnings” (Whitehouse.gov., p. 1). In addition

3. THE EQUAL PAYMENT ACT 3
the report identified that the biggest suffers of unequal pay were “African-American and Latina
women, with African-American women earning 64 cents and Latina women earning 56 cents for
every dollar earned by a Caucasian man” (Whitehouse.gov., p. 1). The negative effects of EPA
violations were echoed in a 2014 Pew Research Report showing that nearly 80 percent of women
and 60 percent of men believe that continued changes need to be made in addressing “equality in
the workplace” (Patten, 2015, p. 1).
A 2013 Equal Pay Task Force Report (EPTF Report) describes in detail the negative
effects of unequal pay for women and society as a whole. Labor participation rates for women
have risen from approximately 37 percent in the 1960s to 57 percent in 2012 (Whitehouse.gov.,
p. 10). The EPTF Report cites the following as potential problems with unequal pay for women
(Whitehouse.gov., p. 9):
The areas described above may be viewed as pure economic issues. For instance, single
households led by women and married women that contribute to households may suffer from one
to all of these areas if their pay is legitimately unequal to men. Another area that is effected by
unequal pay may be viewed as non-monetary consequences. J.P. Hervis, president of Insider
Media Management, states “disgruntled employees who feel they’re being treated unfairly aren’t
as likely to do their best work” (Davis, 2015, p. 1). In addition to decreased productivity,

4. THE EQUAL PAYMENT ACT 4
employee morale, lack of diversity and increased turnover rates may occur when EPA violations
occur. These negative consequences will have adverse effects on both the employer and
employee. According to Joseph (2015) “companies with a reputation for compensating men and
women equally may have access to a larger talent pool when recruiting and hiring” (p. 1).
Current EPA Case
Violation of the EPA occurs in small to large companies. In 2012 a Citibank employee,
Heidi Wilson, received back pay of $340,000 in arbitration for violation of the EPA. Wilson
contended that she earning considerably less than her male counterparts for the same job. Ryan
Barack, Wilson's attorney, stated “it wasn't fair that they were paying the men who did the same
job twice as much” (Behrman, 2012, p. 1). It appears that Citibank’s human resources guidelines
concerning compliance with equal pay was poorly prepared as their argument failed to move the
Court. The following chart describes Citibank’s reasoning in paying Wilson less money than her
male counterparts (Behrman, p. 1):
Ultimately, the Court ruled that “that the evaluations conducted by Wilson's supervisor
were too subjective” (Behrman, p. 1). In addition, Wilson was able to prove that Citibank’s claim
of paying less because of poor economic conditions was unfounded as “testimony showed other

5. THE EQUAL PAYMENT ACT 5
employees received huge bonuses during the recession, some of which were greater than
Wilson's entire salary” (Behrman, p. 1). This case drew national attention as President Obama
addressed the Court’s findings by stating “people should know that even in 2012 that pay
discrimination against female executives still continues, and people should be aware of it and do
what they can to eliminate it" (Behrman, p. 1).
In another case, The Equal Employment Opportunity Commission (EEOC), filed a claim
in May 2015 against True Oil LLC and nine of its associated companies for paying their women
accountant clerk employees less salary than their male accountant clerk employees (Neary, 2015,
p. 1). According to Neary (2015) True Oil LLC issued a public statement saying that male
accounting clerks receive higher salaries than women accounting clerks (p. 1). The EEOC claims
that lower pay was made to women “who have done substantially the same work using the same
skills and under similar conditions” (Morton, 2015, p. 1). The following chart depicts evidence
of violation of the EPA as the EEOC tracked three True Oil employees pay rates during a four
span (Morton, p. 1):
Employee Year Hired Experience Pay Rate
Male 2002 1 accounting course, 1
year with accounting
firm, 11 years as store
manager with basic
bookkeeping duties
+ $4.07 per hour more
than female #1
+ $3.09 per hour more
than female #2
Female #1 2004 AA Accounting degree
and 17 years in general
accounting jobs
-$4.07 per hour
Female #2 2004 Studied accounting for
2 years,owned her own
business for 10 years,
and 5 years of
bookkeeping
experience
-$3.09 per hour

6. THE EQUAL PAYMENT ACT 6
Compliance
There are a number of tools and methods that an HR division can use in ensuring that a
company is not violating EPA. One of the first things a company can do is to verify if they must
be compliant with the EPA. According to BizFilings (2012) there are certain industries and
situations where an employer is exempt from being compliant with EPA (p. 1). A few examples
include “[e]mployees of amusement or recreational establishments having seasonal peaks,
agricultural employees who are members of the employer's immediate family, and workers
principally engaged in the range production of livestock, such as cowboys and shepherds” (p. 1).
In general, a business will find that they must be compliant with EPA regulations. A job analysis
can be performed that looks at pay structure and job classes for men and women working within
the company. According to BizFilings if a pay discrepancy occurs showing women receive lower
pay than certain questions must be asked and answered in validating the pay differences (p. 1).
The following chart describes a few defenses that a company may claim in defending against
EPA violations (BizFilings, p. 1):

7. THE EQUAL PAYMENT ACT 7
According to Davis (2015) a company should regularly review compensation, stay up-to-
date on current compensation rates, and consider an open pay policy (p. 1). Davis states “To
prevent issues with unequal pay, you can monitor companywide compensation on a regular
basis” (p. 1). A comprehensive evaluation would take into consideration all types of payments
that includes (1) salary (2) bonuses (3) benefits (4) compensation for job training and (5) any
other perks (Davis, p. 1). In addition, The American Bar Association (ABA) recommends
looking at adds “job placement, transfers, and promotions” when evaluating current
compensation (Orrick, Herrington & Sutcliffe LLP., 2010, p. 24).
Data from internet sources can be used to determine competitive salary rates. Patricia
Harden, president of Harden Partners, states “in our industry, for instance, there are numerous
salary surveys by trade publications, recruiters and professional organizations” (Davis, p. 1). An
open door policy of allowing employees to disclose salaries without retaliation would add
transparency to any organization. A 2001 survey revealed that approximately 33 % of employers
banned employees from discussing salaries. A 2011 survey from the Institute for Women's
Policy Research showed that approximately 50% of companies “discouraged or prohibited”
discussion of employee salaries (Dreisbach, p. 1).
According to Dreisbach (2014) “under a nearly 80-year-old federal labor law, employees
already can talk about their salaries at work, and employers are generally prohibited from
imposing pay secrecy policies” (p. 1). Two major hurdles is that many managers are not aware of
the law, and those who violate the open door policy provision of the 1935 National Labor
Relations Act do not suffer great consequences. Cynthia Estlund, a law professor at New York
University, points out that “even if an employee signs a nondisclosure agreement with an
employer, the employee would still be protected when talking about salary” (Dreisbach, p. 1).

8. THE EQUAL PAYMENT ACT 8
Additional Considerations
The 2009 Ledbetter Act enhanced protection of EPA by requiring businesses to create,
store, and report wage rates to the EEOC (Orrick, Herrington & Sutcliffe LLP., p. 37).
“Employers are required to “preserve records that document and support the method, system,
calculations, and other basis used . . .in establishing, adjusting, and determining the wage rates
paid to [their] employees and create reports based on these records and submit reports to EEOC”
(Orrick, Herrington & Sutcliffe LLP., p. 37). In addition, an employer who discovers that they
have been paying women lower wages for similar work cannot lower male counterpart employee
wages. This type of remedy violates the 2009 Ledbetter Act.
Conclusion
This paper has demonstrated the negative impacts of violating EPA. Unequal pay is an
increasing problem for employers and employees. Part of this paper attempted to illustrate how
companies can prevent the problem by taking proactive measures that includes creation of a job
analysis, regularly review compensation, staying up-to-date on current compensation rates, and
consider an open pay policy. Data within this report suggests that EPA violations cause harmful
effects in the areas of housing, healthcare, education, childcare, access to credit, and other areas.
In addition employee productivity, morale, and turnover rates can be greatly effected when EPA
violations occur.

9. THE EQUAL PAYMENT ACT 9
References
Behrman, E. (2012, April 16). Tampa woman wins lawsuit against Citicorp for pay
discrimination. Retrieved from http://www.tampabay.com/news/tampa-woman-wins-lawsuit-
against-citicorp-for-pay-discrimination/1225359
BizFilings (2012, May 24). Complying with gender-based equal pay laws. Retrieved from
http://www.bizfilings.com/toolkit/sbg/office-hr/managing-the-workplace/complying-with-
gender-based-equal-pay-laws.aspx
Chu, L. (2009, February 2). Obama's first law: The fight for fair pay. Retrieved from
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Covert, B. (2014, January 29). Five years after The Lilly Ledbetter Act, how to start closing the
gender wage gap. Retrieved from http://thinkprogress.org/economy/2014/01/29/3223331/
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Dreisbach, T. (2014, April 13). 'Pay secrecy' policies at work: Often illegal, and misunderstood.
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