National Equal Pay Day marks just how far into the year women must work to earn what men earned in the previous full year for the same jobs. As the National Committee on Pay Equity notes, “because women earn less, on average, than men, they must work longer for the same amount of pay.” In a sense, women worked the first 94 days this year for free.
But there’s a new glimmer of hope thanks to a little-known but breakthrough Massachusetts law that attacks a major factor in gender pay inequity: The use of salary history as a basis for salary future.
The first step toward closing the gender pay gap is to stop perpetuating it. A key but mostly hidden driver is that a woman’s lesser pay for the same work and value can follow her from job to job. When employers tie future pay to salary history—as many still do—it can compound the impact and set a woman back her entire career. Unfairly, past becomes prologue.
But fighting this pay-inequity driver is hard for individual women to take up. When a potential employer asks for salary history, candidates are under extreme pressure to give it up.
The Massachusetts provision puts every job candidate—woman or man—in a stronger, fairer pay negotiating position that can affect their jobs, careers and families for a very long time. The Massachusetts pay-equity law is a welcome model and challenge to the nation. By curbing the perpetuation of historically underpriced pay, women can push towards market-competitive compensation that reflects their market-competitive value. But this is not a gender issue. Organizations perform better when employers and employees both feel they got a fair, honest deal which becomes much more possible when compensation is fair and transparent.