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Lilly Ledbetter and What's Next in Tackling the Pay Gap

Amy Traub

Seven years ago today, the Lilly Ledbetter Fair Pay Act became the first piece of legislation that newly-inaugurated President Obama signed into law. The law restored protections against pay discrimination that had been restricted by a recent Supreme Court decision, making it easier for working people to hold their employers accountable for discriminatory compensation. Advocates today can point to a host of legal cases where the law made a difference, and its impact is broader still: because employers know they can still be held liable for discrimination, they have a greater incentive to pay workers fairly.

Even as the law was signed, supporters acknowledged that it would not be enough to prevent discrimination on the job.

Indeed, the latest statistics indicate that the median woman in America working full-time throughout the year is still paid just 79 cents for every dollar earned by a man. Much greater gaps occur when gender and race discrimination compound each other: at the median, Latinas are paid just 54.6 percent of white male compensation and black women earn just 59.8 percent of white male pay.

How can these persistent gaps be addressed?

One logical step is to dispel the ignorance that allows discriminatory pay to persist simply because workers of different races and genders do not realize they are being paid differently for the same work. The Paycheck Fairness Act, a companion bill to the Lilly Ledbetter Act, would have allowed employees to share wage and salary information with each other without fear of employer retaliation and required employers to demonstrate that pay gaps between men and women were based on factors other than gender. That bill has been repeatedly blocked by Congress.

Frustrated by the inaction, President Obama signed an executive order in April 2014 mandating that federal contractors allow employees to discuss compensation without fear of retaliation. Another executive action required contractors to provide the government with better data on their pay practices. This week, the Administration is acting to require that all employers with more than 100 employees on payroll report pay information as well, a step that officials explained would “bolster the government’s ability to penalize companies that engage in discriminatory pay practices and to encourage businesses to police themselves better and correct such disparities.”

Being paid less for doing the same job is just one aspect of the pay gap. Since women are more likely than their male counterparts to leave the workforce or reduce their work hours to care for children, elderly parents, or other loved ones in need, they miss out on pay, job experience, and opportunities to advance in their careers, further fueling the gender gap in pay. As I’ve noted before, providing paid family leave boosts incomes and enables women to remain attached to the workforce. Over time, paid leave could cut the pay gap in a less direct—but potentially more powerful—way than policies that aim at fighting straightforward discrimination, as vital as they are.

As I’ve argued before,  paid leave actually benefits women to a greater extent the more men use it. Combined with policies to raise the minimum wage, guarantee paid sick time, and make it easier to organize unions, paid family leave offers great potential for achieving women’s equality.

On paid leave too, Obama has worked to provide leadership without relying on Congress: the Department of Labor has provided grants to states, cities, and counties to study the effects and feasibility of paid leave programs. And the U.S. military has announced this week that it is expanding its maternity and paternity leave policies for service members.

Next week, I’ll release a brief taking a close look at public and private efforts to establish paid family leave in New York State.  Cutting the pay gap would be just one benefit of a comprehensive family leave insurance policy.