How Do You Feel About The Government Ruling On Our Wages?

by | May 29, 2012 | General

HR professionals who manage compensation use their professional judgment to consider a number of legitimate factors in creating fair and equitable compensation systems. These include experience, education, profitability, merit, productivity, prior salary history and location. The Paycheck Fairness Act (PFA) would allow the Federal government to second-guess employer pay practices in a few concerning ways…

  1. Restrict employer flexibility in pay decisions – The PFA would effectively prohibit employers from using many legitimate factors to compensate their employees, including professional experience, education, training, employer need, local labor market rates, hazard pay, shift differentials and the profitability of the organization. The PFA would permit employers to base pay decisions only on production, merit and seniority.
  2. Require collection of employer wage data – The PFA would authorize the Equal Employment Opportunity Commission and the Department of Labor to collect compensation data from compensation managers.
  3. Reduce employee privacy – The PFA would effectively encourage employees to discuss or publicize their co-workers’ wages by preventing employer retaliation against an individual who publicly discloses the wages of other employees.

Senator Barbara Mikulski (D-MD) introduced S. 3220, the Paycheck Fairness Act, on May 22, 2012. The Senate plans to vote on S. 3220 during the week of June 4-8.

While I am strongly committed to preventing and resolving any form of workplace discrimination, including pay disparities between women and men, I believe wages should be determined by the market, type of position, education of the employee and the employer needs, not by the government. The Paycheck Fairness Act would threaten the tools that HR professionals use to reward and retain their employees. The bill would also have a negative impact on employee privacy by encouraging employees to publicize their colleagues’ wages.

We encourage you to share your thoughts with your local representatives prior to June 4th, 2012.

UPDATE: The Senate voted down this bill on June 5th.