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Equal Pay Day, observed this year on March 26, highlights how far into the current year the average woman must work to earn what the average man earned in the prior year. While the date may shift from year to year, the conversation it prompts does not.
For employers, Equal Pay Day is less about the metric itself and more about what it reflects: pay systems are receiving sustained attention — from employees, regulators, and plaintiffs’ counsel alike.
A Changing Context Around a Familiar Issue
The concept of pay equity is not new.
Over the past several years, in an effort to close the persistent pay gap, jurisdictions across the country have enacted or expanded:
- Pay equity statues, expanding potential comparators and narrowing permissible explanations for differences in pay;
- Pay transparency requirements, including pay, benefits, and other disclosures in job postings and to employees; and
- Pay data reporting obligations, placing datasets in the hands of regulators.
These developments do not operate in isolation. They combine transparency for employees with heightened scrutiny for employer compensation systems and pay decisions.
For employers operating across multiple states, the result is a patchwork of requirements and considerations that continue to evolve.
Looking Ahead
Equal Pay Day is a reminder of work still to be done and an opportunity to examine whether current compensation practices align with today’s pay equity, transparency, and reporting requirements. For many, that may include:
- Reviewing pay data to understand current outcomes;
- Assessing whether policies align with actual practices; and
- Considering whether a more formal analysis is warranted.
Employers considering these reviews should conduct them under the attorney-client privilege to allow for a more candid assessment of potential legal risk areas and next steps. Employers that periodically step back and evaluate their compensation practices, particularly in light of changing legal requirements, are better positioned to respond when questions arise.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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