By Becky Gillette
Contains Loopholes That Concern Some
In April, Mississippi became the last state in the country to adopt a pay equity law to require employers to pay the same wages to women as men under similar working conditions doing substantially equal work requiring the same skills, education, effort, and responsibility. The law that went into effect July 1 is titled the Mississippi Equal Pay for Equal Work Act.
Scott Waller, president and CEO of the Mississippi Economic Council, says MEC was very supportive of the legislation. “We worked with legislators on the issue and believe the final language was fair,” says Waller.
Steve Cupp, a partner with Fisher Phillips in the firm’s Gulfport and New Orleans offices, says the law brings Mississippi in line with the federal Equal Pay Act of 1963. While most employers were already subject to federal law, Cupp says the state law changes things up a bit.
“I wouldn’t exactly call it earth moving in Mississippi, but it does provide some additional protection for employees,” Cupp says, who specializes in labor and employment law. “To me as a litigator representing employers, the state law allows a plaintiff to file a lawsuit and keep it in state court. If you file in federal court under federal law, or if a federal claim is filed in state court and then removed to federal court by the employer, the federal venue tends to be more favorable for employers. It is interesting, too, that it is one of the few state employment laws on the books. Keep in mind Mississippi doesn’t even have a department of labor and most states do. This was kind of eye opening for practitioners that Mississippi finally put an employment law on the books. But there are limitations to it. It will probably be pretty easy for a company to defeat a claim because of certain ways compliance with the law is defined.”
States can pass laws that provide more protection for employees than federal law and some states like California, New York, and even Louisiana have done that. States are not allowed to pass employment laws that don’t meet the minimum federal standards.
“The law when being proposed was heavily criticized by a lot of advocacy groups who says there are too many outs here for the employer,” says Cupp. “The difference is federal laws have exceptions for seniority, merit systems and the catch all phase ‘any other factors than sex.’ That phrase under federal law is not further defined. The courts have been left to determine what that phrase means. Mississippi went ahead and defined some of the things that could be used as factors other than sex such as salary history, continuity of employment, the extent to which there was competition with other employees for the employee’s services, and if someone negotiates a higher salary.”
Cupp says the law may disproportionately impact women who leave the workforce for raising a family and then re-enter the workforce. Employers can justify paying her a lower rate by saying she has been out of the workforce.
“I think it is a legitimate criticism, but that is what we got,” says Cupp. “That was the thrust of the criticism of a worker’s rights advocacy group. One group online says it would rather have no law than this law. It is clearly geared towards generating business for Mississippi and not as much as implementing more protections beyond the federal floor level for employees. But the governor and Attorney General Lynn Fitch says this is needed and a step in the right direction.”
The provision for allowing a woman to be paid less than a man because he asked for a salary increase raises some tough issues. How do you find out what other people at your company are being paid? It can be seen as an intrusive question. Some may consider what they are paid to be private. It isn’t unusual for companies to discourage employees from discussing their wages and benefits, even though the National Labor Relations Board takes the position that employers may not prohibit employees from discussing their compensation among each other.
In every equal pay matter Cupp has been involved with, it has always been a situation where a woman was being paid less than a man for the same kind of work. The American Association of University Women has estimated women working full-time in Mississippi earn twenty-three percent less than men.
Cupp says that if a company has an equal pay lawsuit filed against it alleging disparate wages, the company can just raise the employee’s rate of pay, maybe pay some back pay damages, and avoid the cost of going through a lengthy court process. One thing he says they can’t do is reduce the pay of the male employee to match that of the female employee.
If a violation is proven in court, the Mississippi law limits the remedies to attorneys’ fees, prejudgment interest, liquidated damages, and 100 percent of the difference in unpaid wages for a two-year time period. Cupp says the federal law contains similar remedies, but allows an employee to assert a claim going back three years, and each paycheck that is issued which contains a pay inequity restarts the time period for the statute of limitations.
The Mississippi law also exempts smaller businesses from compliance. Cupp says the Mississippi law defines an “employer” as any entity that employs five or more employees. The federal law can apply to an employer with fewer employees as long as the employer or the employees are subject to the Fair Labor Standards Act.
Another difference is the Mississippi law defines an “employee” as someone who is employed to work forty or more hours per week, while the federal law doesn’t require full-time employment.
