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Legislative Memo

Frank Kerbein
Director, Center for Human Resources
T 518.465.7511
www.bcnys.org

BILL:

A.4696 (Titus)

Support

SUBJECT:

“New York State Fair Pay Act”

 

DATE:

February 15, 2017

 

This legislation would amend the New York State Labor Law to expand the long-standing “equal pay for equal work” concept to include the requirement for equal pay for different work that, according to some third-party criteria are judged to be “equivalent.” This approach is commonly referred to as “comparable worth.” The Business Council of New York State opposes this bill.

Equal Pay is already the law
For nearly 50 years, equal pay for equal work has been the law of the land for both public and private employers. From the Equal Pay Act of 1963 and the Civil Rights Act of 1964 to New York State’s recently enacted Equal Pay Act (2016), these laws have created vigorous standards and enforcement consequences that compel employers to pay all employees the same for work of “substantially equal” skill, effort, responsibility, and working conditions. Current law prevents employers from having pay differentials based on the sex or race of employees. New York law, in fact, already requires the employer to bear the burden of proving that any pay differentials are based on “bona fide” factors other than sex.

We strongly question to need for additional legislation to address the issue of “equal pay.”

Market based wages are rejected
The theory of “comparable worth” rejects the role of labor markets in the determination of pay, and instead substitutes purported objective criteria to be used to assessment the “value” of the work. Under this legislation the New York State Department of Labor will develop a system for job evaluations, without regard to important free market considerations, such as supply of employees and candidates with the skills and experience for a specific job.

To remain competitive with the rest of the nation, responsible New York employers need to have the ability to set job rates based on a myriad of market factors. Setting pay rates based on factors like geographic and industry differentials, revenue and profitability, organization size, etc. are vital for New York employers to thrive in a competitive market.

In addition, in a free market, the value of a job is most often affected by the current supply of certain types of workers and the relative demand for such services. All workers have the opportunity, by law, to strive for careers in high demand jobs. The concept of “comparable worth” is a flawed concept based on the hope that, through the threat of government enforcement, equality of opportunity can be replaced with the mandate of equality of results.

For these reasons, The Business Council opposes this legislation and respectfully urges that it not be approved by the State Legislature.