Now that healthcare reform is a done deal, employers have a new Congressional concern: The Paycheck Fairness Act.
The PFA “has the potential to cripple companies, particularly smaller businesses,” attorney Jane McFetridge told the Senate Committee on Health, Education, Labor and Pensions in a recent hearing on the proposal (S. 182).
Why’s that? Because the PFA has no statutory cap on damages.
Bigger burden on employers
The PFA’s other big danger for employers: A narrowing of the acceptable reasons for pay differentials between sexes. Current law — the Equal Pay Act of 1963 — allows a company to defend unfair pay practices by proving the comp decision was based on “any factor other than sex.”
The PFA would force employers to show the difference in pay was based on a “bona fide factor other than sex” that is “job related” and “consistent with business necessity” — a much stricter standard.
McFetridge is a partner in the employment law firm Jackson Lewis. A full account of her testimony can be found here.
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