Although federal and New York State Law already prohibit gender-based pay discrimination, the New York State Assembly and Senate have passed a new bill (A06075, S00001) intended to “ensure that women receive the wages they were always entitled to.” Governor Cuomo has indicated that he will sign the bill.
Under the current law, employers can defend a claim of pay discrimination by showing that a wage disparity results from “any other factor other than sex.” The new bill, however, would require that employers instead prove that a disparity is a direct result of “a bona fide factor other than sex such as education, training or experience” and is “job related” and “consistent with business necessity.” Even if an employer can make such a showing, an employee may still win a claim by showing that the employer could have adopted an alternative business practice that would have remedied the pay disparity, but refused to do so.
The proposed bill also attempts to end gender-based pay discrimination by:
- Increasing liquidated damages from willful violations to up to three hundred percent of wages owed to an employee as a result of an illegal disparity;
- Making it illegal for employers to prohibit employees from “inquiring about, discussing, or disclosing the wages of such employee to another employee”; and
- Requiring the Department of Labor to provide training and resources to assist employers with revising and updating their pay practices.
Given these potential new penalties, limitations on defenses, and intensified enforcement and training efforts by the Department of Labor, now is the time for employers to carefully review their pay practices to ensure that they are complying with equal-pay laws.