“This is a very big issue in our country.”
Democratic presidential candidate Sen. Kamala Harris, D-Calif., introduced a plan Sunday she believes will help solve the “gender wage gap” that has generated headlines in recent years.
Harris seeks to put the onus on employers to prove that they are not engaging in pay discrimination. The plan calls for a 1% fine to profits for every 1% in wage gap they allow to continue.
At a rally promoting the plan Sunday, Harris said the burden should be on companies to prove they don’t discriminate.
“What I am proposing is we shift the burden. It should not be on that working woman to prove it, it should instead be on that large corporation to prove they’re paying people for equal work equally,” Harris said. “It’s that simple, it’s literally that simple. And this, then, is not only about fairness and equality, it’s about transparency. Show us what you got. That’s it.”
The Harris campaign says the plan would also raise about $180 billion in revenue over 10 years, with that figure decreasing with time as more companies come into compliance with the law.
According to Census Bureau data, women working full-time made about 80 cents for every dollar a man made in 2017. Harris says her plan would make “closing that pay gap and holding corporations accountable for transparency,” a national priority, warning that penalties would be forthcoming for non-complying employers.
According to the plan, large companies would be forced to obtain an “Equal Pay Certification” that shows they pay women and men the same amount for equal work. Companies would be required to display on their websites whether or not they have obtained the certification, while compliance with the law would also be disclosed to shareholders on every annual report.
The plan calls for companies with more than 100 employees to obtain the certification from the Equal Employment Opportunity Commission within three years of the proposal becoming law. Companies with more than 500 employees would have two years to gain certification, with compliance reports publicly posted on the EEOC website.
According to Harris, revenue generated from fines would help pay for her proposed plan to mandate 12 weeks of paid family and medical leave.
Companies would be forced to prove that any pay disparities between male and female employees in similar roles are due to merit, performance, or seniority. Critics of similar plans contend that these factors more than explain the perceived gender pay gap at large.
According to a recent Harvard study, most of the pay gap virtually disappears once men’s tendency to work more hours than women is taken into account.
Economists Valetin Bolotnyy and Natalia Emanuel, the study’s authors, noted that discrepancies in pay can be explained by the different choices men and women make in the workplace.
“The gap of $0.89 in our setting can be explained entirely by the fact that, while having the same choice sets in the workplace, women and men make different choices,” Bolotnyy and Emanuel said.
Their research largely echoes that of previous studies done on the wage gap, which have consistently noted that career choices are the primary factor in differences in pay between men and women.
According to the American Enterprise Institute, men tend to gravitate towards higher-risk, higher-paying careers. Additionally, men tend to work more hours, accumulate more years of continuous experience in their fields, are more willing to tolerate long commutes and relocations for work, and are more comfortable in fields that have a merit based pay structure like sales commissions. When controlling for these factors, the wage gap almost entirely disappears.
In response to the Harris plan, Republicans noted that women’s unemployment and wage growth has been strong under the policies of President Donald Trump. They argue that more regulation of businesses isn’t necessary, while cautioning against adding policies that risk the gains women have made in the workplace.
“We don’t need to strap new regulations, burdens or fines on businesses to create opportunities for women, and President Trump’s economic record is a testament to that,” said Blair Ellis, a spokeswoman for the Republican National Committee.
Nevertheless, Harris insists the “problem” is worth addressing. Her plan calls for companies to report overall gender wage gaps, without taking into account possible contributing factors such as experience, performance and job titles.
In addition, Harris calls for companies to report the percentage of women who hold leadership positions and the share of women that are top wage earners at the company.
“The reality of it is that the economy of America is not working for working people, it’s just not,” Harris said.
“This is a very big issue in our country and deserves all the resources and attention that anyone would expect when we are talking about whether or not people are paid for the work they do,” she added. “It’s a simple American value, as far as I’m concerned, pay people for the work they do.”