The Equal Pay Act

What is the Equal Pay Act (EPA)?

The Equal Pay Act requires employers to pay men and women equally.  Pay is defined as wages and benefits.  Even though the EPA was passed to protect women, it protects both men and women from wage discrimination. 

Who is covered under the EPA? 

A business is covered if it has $500,000 or more in yearly sales.  Businesses that generate less than $500,000 are still covered if they engage in interstate commerce.  Practically speaking, this means that every business is covered absent exceptional circumstances.  Unlike other discrimination statutes, it does not matter how many employees are employed by the business.

What is required of an employer under the EPA?

Men and women who work in “substantially similar” jobs must be paid at the same pay rate.  This requires men and women to be paid equally even if their jobs are not perfectly identical. 

What jobs are substantially similar?

Jobs are substantially similar if they require substantially equal skill, effort, and responsibility.  Additionally, the job must be performed under similar working conditions with the same employer.  Job titles will not be decisive.  A court will look at the substance of the employee’s work.    

Are there any exceptions under the EPA?

Yes.  There are four exceptions to the EPA.  An employer can pay an employee of the opposite sex more for one of the following reasons:

  • Seniority
  • Merit
  • Quantity or Quality of Production:  Paying on commission, for example.  Both men and women must have the opportunity to earn the higher wage.
  • Any factor other than sex

What happens if an employer violates the EPA?

An employer who violates the EPA can be ordered to do the following:

  • Pay back wages, equal to the difference between what the employee earned and what he or she should have earned.  An employee can collect two years of back wages or three years if the employer committed a willful act.  Pay additional “liquidated damages.”  Pay the employee’s costs of suit and attorneys’ fees.  Be forced to raise any underpaid employees salary. 

Other Resources: 

Equal Pay and Compensation Discrimination

Compensation Discrimination:  EEOC Compliance Manual