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Equal Compensation According to the Law

Matt Luman January 24, 2018 0

Equal Compensation According to the Law

One of the most talked about topics among workers and business owners today is equal compensation. Some companies use the traditional method to determine equal compensation by creating formal job descriptions that list qualifications and salary compensation.

Many larger companies choose this method because it offers a more organized, comprehensive way to provide equal compensation. This method provides one other benefit: the ripple effect of articulating job descriptions and wage compensation to job applicants and new hires upon initial orientation.

However even when job descriptions are clearly outlined, various differences arise as a result of skill sets of individual workers. Often, workers may start at equal compensation. When duties of the job highlight a worker’s special skill, this changes equal compensation. Business owners rely on federal and state labor laws to define equal compensation.

How Inequity Arises in Compensation

In most cases involving equal compensation, the basis of inequity may be a result of discrimination based on age, race or gender. Business owners should review the Equal Employment Opportunity Commission’s “Equal Pay Act of 1963, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, and Title I of the Americans with Disabilities Act of 1990.”

The Equal Pay Act of 1963 specifies that although jobs needn’t be identical, they must be equal. Also, employers may not pay unequal wages to women who do the same jobs as their male counterparts.

The Equal Pay Act provides a summary of factors that substantiate equal compensation according to the law. This includes skills, working conditions, effort establishment and responsibilities.

Under the Equal Pay Act, “affirmative defenses” for difference in wage compensation include:


  • Seniority
  • Quality or quantity of production
  • Merit
  • Factors other than gender, race, disability, religion, color, age or national origin.


Responsibilities for Equal Compensation
Business owners, CEOs or CFOs are usually responsible to create a business’s wage compensation guide. However, it is equally important for all employees to know state and federal labor laws as they pertain to their right to equal pay.

Should a conflict arise between employer and employee regarding equal compensation, when both parties understand the full terms of the Equal Pay act, issues are easier to resolve.

It is also important for employers to ensure workers are fairly compensated on an overall basis to avoid potential legal liability. In addition to access to legal counsel, it becomes necessary for Human Resources personnel and business owners to implement a Workforce Safety Program and take part in Workforce Safety Training.

When employees feel their employer is knowledgeable in equal compensation and safety, they find it easier to understand company policies such as wages and benefits.

Training and Compliance Resource
360 Training on Demand offers a free 7-day trial of the Workplace Safety and Compliance Library, as well as a host of training courses. For a wealth of information about these training courses, visit https://www.360training.com/environmental-health-safety/workforce-compliance. There’s a training course suitable for every business owner, Human Resource and employees’ need.


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