Your employee's 'additional duties' may be illegal under the Equal Pay Act
Larry and Linda are fictional senior accountants. Both earned master’s degrees in finance, have five years apiece on staff, receive the same base pay and perform exceptional work. But Larry also trains junior accountants, and receives $20 a month more than Linda in his paycheck. Seems fair, right? Not so fast. It’s not if Linda wasn’t given the same training opportunity.
Larry’s “additional duties” could be violating the Equal Pay Act. Taking on extra work assignments might look good on his employment record, but could be considered discriminatory against Linda.
The law requires employers to pay men and women equal pay for equal work unless employers can demonstrate that the pay disparity between employees of different genders is fair and nondiscriminatory. An exception is when an employee is paid for “additional duties” that lower paid workers don’t perform.
The conflict for HR
To justify the pay disparity between Larry and Linda’s pay under the EPA, HR would have to establish that their jobs are equal and that the “additional duty” actually exists. In other words, that Larry is actually performing duties that Linda did not.
The tricky part comes down to a question of opportunity. HR can’t defend Larry’s additional pay for training junior accountants under the EPA in this example because Linda wasn’t assigned to do training, even though she’s as qualified as Larry to do so. In essence, Linda wasn't offered the chance to train junior accountants and earn extra money.
There are other specific instances in which additional duties create potential discrimination conflicts. Pay differentials related to additional duties can cause pay disparity problems if:
- The higher paid worker isn’t actually performing “additional duties.” Managers have been known to give subordinates they like extra pay for work they haven’t performed.
- The lower paid worker also performs the same additional duties as the higher paid worker. If the employees share the work, they should receive identical pay.
- The “additional duties” don’t exist. Few managers make up tasks to raise a worker’s pay. But those who do sometimes figure that since HR seldom comes around or makes inquiries about pay or duties, why not help a worker.
- The extra duties lack significance. Their description on paper might seem impressive, but on closer inspection, the actual tasks performed don’t justify a pay increase. If for example, Larry’s “training” was merely handing out materials to trainees, the task wouldn’t justify a pay differential.
- Third parties who also are performing the same additional duties are paid less. If an employer hires temporary workers to do some of the tasks Larry is being paid extra to do, a claim could be made that Larry is getting a pay differential because he’s a man and not because the additional duties add value to the company.
Weighing pay differentials
Before signing off on pay differentials, HR should ask managers or supervisors:
- What are the specific extra duties?
- Why do the extra duties merit a pay differential?
- Will anybody else be performing these duties?
If managers give vague responses or the additional duties aren’t performed as expected, HR will need to intervene and decide what changes might be necessary. Overlooking the problem could make employers liable under the EPA.
Equal pay and wage transparency are likely to continue to challenge HR. On the federal level, tracking requirements under the EPA and other laws created headaches. Business groups have asked the Trump Administration to roll back new EEO-1 report requirements related to tracking pay. The outcome of those appeals isn't known yet, but employers must still comply with state requirements and other anti-discrimination regulations. More broadly, however, pay disparity issues — real or perceived — have serious implications for employee engagement and workplace culture.
Tracking pay can be data-intensive and complicated, but confronting pay discrimination should be a best practice. HR should review pay practices, skills, job descriptions, wages, bonuses and other monetary-related information to ensure employee pay is not predicated on discriminatory factors.