Frequently Asked Employer Questions: Auditing Employee Pay Structures
What impact do the recent collective bargaining agreements equalizing pay between the Men’s and Women’s US Soccer teams have on employers outside of professional sports?
Following protracted equal pay litigation, the U.S. Soccer Federation has agreed to pay the U.S. Men’s National Team and the U.S. Women’s National Team equally, which (at least through 2028) eliminates a pay gap between male and female players and includes an equalization of FIFA World Cup prize money. Such an agreement is actually the first in the world in professional sports, not just the United States.
From a wage and hour perspective, The Equal Pay Act of 1963 seeks to eliminate wage disparity on the basis of sex for employees (i) within the same business, (ii) performing equal work at jobs (iii) that require equal, skill, effort, and responsibility, and (iv) are performed under similar working conditions. Unless the employer can show that the pay disparity is actually caused by a (i) seniority system, (ii) merit system, (iii) quantity/quality of production, or (iv) factor other than sex, similar employees (based on the above) of different sexes must paid the same.
Pay audits, where employers verify employees’ wages and identify any pay disparities, are vital to achieving pay equity.
The US Soccer collective bargaining agreements and publicity surrounding them are a good reminder to employers of any industry to regularly audit employee pay structures within this framework and make any necessary changes to ensure compliance with the Equal Pay Act of 1963.
This update provides general information and does not provide tailored legal advice or establish an attorney-client relationship.