What You Need to Know about the Paycheck Fairness Act (PFA)

I got an email today from SHRM to tell me more about the Paycheck Fairness Act. It could go to a vote as soon as tomorrow, April 9, you want to get versed on it pretty quickly.

SHRM’s take on the PFA is that the PFA would significantly limit the flexibility of HR professionals to compensate their employees.

After doing a bit of research, I’m inclined to agree. We have the Equal Pay Act of 1963 — why do we need the PFA? I’m not sure that I totally buy that it will help equalize pay between men and women. I actually still have some questions on the “wage gap.”

Here are a few more points from SHRM (quickly and nicely packaged) in why the PFA is not a good idea:

*  Restrict employee compensation – The PFA would effectively prohibit an organization from basing its pay decisions or compensation system on many legitimate factors, such as an employee’s professional experience, education, or the company’s profitability. In practice, this would take away many factors HR professionals use to compensate their employees and could particularly discourage employers from providing bonus pay. Also, employees would be barred from negotiating for higher wages because of the wage disparity that could result.

*  Allow government wage data collection – The PFA would empower the U.S. Equal Employment Opportunity Commission and the Department of Labor to collect wage information from employers of all sizes, a time-consuming and unnecessary exercise that would only facilitate litigation.

I personally am not all about the second bullet — one, it feels too “big brotherish” and two, its one more administrative thing for HR pros to have to spend time on managing.  The bill is suppose to help impact the wage gaps between men and women… but I don’t think that this is the way to go about it.

Here are a few other reads that I think you should check out — but you know me, I’m always going to tell you to do some research, get the information, and arm yourself with knowledge — make your own opinion. Put down Facebook, Pinterest, and Instagram and get after it.

Now this isl egislation — as always, don’t think about this from a “party line” issue — look at it objectively — look at the issue and THEN make up your own mind. Let’s discuss — but keep to the issues of HR and pay — and not the politics. Although so many of the articles are pinning things one party against the other — try to ignore that and stay neutral.

These will help you get started:

So what do you think?

          OR      

Get your research on!

Yours,

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3 comments

  1. Hello! First time at your blog. I’d just like to say that every state already collects wage data every quarter. It doesn’t take long. The numbers are all in the computer system already, it’s just a matter of plugging the data into a state form on the internet. As an HR manager, I’ve done it every 3 months for 12 years for about 50 employees. It takes 10 minutes if I do it on my own, less if the duty is split between an HR staff. Data on wages is collected on the federal level every year as well. It doesn’t look like another form to fill out, just that the data would be shared with a new branch of the DOL. It’s going to have to be done anyway, but the packaged information you’ve been sold has misled you about it being time consuming and unnecessary.

    1. Hi Janine! Welcome to the blog and thanks for reading — and commenting!
      Totally appreciate and respect your opinion — I still disagree a bit. You are right about those reports. I’m familiar with some of the items you speak of — its generally for tax information (which I get) or to help with DOL statistics for wages by industry and location. and this would be for all firms of all sizes. I haven’t read anything that they are taking existing data and feeding it over to another agency (EEOC) — I may have missed something that said that they would — filling another form — even if just 10 minutes, if its not valued added, is a waste of time in my opinion — we’re trying to get HR pros doing more strategic and thought leadership, not adding in more administration. Also, its not very clear how the information will be used or what they will do with it once they have it. So they are going to run analysis on it? Use it for litigation? Ask companies to normalize or adjust the pay practices? Or are they just collecting to collect?
      Ultimately, my thought is — I think that we already have an EPA and I’m not sure how this improves or helps wage gaps between men and women.

      Not saying its not a problem — just not convinced this is the [right answer.

      Looking forward to reading more about it — feel free to share anything else that you find — lots of information out there and hard to get you hands on it all… so I love creating an environment of knowledge-share and healthy discussion.

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