Paycheck Fairness Act

II Calendar No. 53 116TH CONGRESS 1ST SESSION H. R. 7 IN THE SENATE OF THE UNITED STATES MARCH 28, 2019 Received APRIL 2, 2019 Read the first time APRIL 3, 2019 Read the second time and placed on the calendar AN ACT To amend the Fair Labor Standards Act of 1938 to provide more effective remedies to victims of discrimination in the payment of wages on the basis of sex, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Paycheck Fairness 4 Act’’. 5 SEC. 2. FINDINGS. 6 Congress finds the following: 7 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 2 HR 7 PCS (1) Women have entered the workforce in 1 record numbers over the past 50 years. 2 (2) Despite the enactment of the Equal Pay Act 3 of 1963, many women continue to earn significantly 4 lower pay than men for equal work. These pay dis- 5 parities exist in both the private and governmental 6 sectors. Pay disparities are especially severe for 7 women and girls of color. 8 (3) In many instances, the pay disparities can 9 only be due to continued intentional discrimination 10 or the lingering effects of past discrimination. After 11 controlling for educational attainment, occupation, 12 industry, union status, race, ethnicity, and labor 13 force experience roughly 40 percent of the pay gap 14 remains unexplained. 15 (4) The existence of such pay disparities— 16 (A) depresses the wages of working fami- 17 lies who rely on the wages of all members of the 18 family to make ends meet; 19 (B) undermines women’s retirement secu- 20 rity, which is often based on earnings while in 21 the workforce; 22 (C) prevents women from realizing their 23 full economic potential, particularly in terms of 24 labor force participation and attachment; 25 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 3 HR 7 PCS (D) has been spread and perpetuated, 1 through commerce and the channels and instru- 2 mentalities of commerce, among the workers of 3 the several States; 4 (E) burdens commerce and the free flow of 5 goods in commerce; 6 (F) constitutes an unfair method of com- 7 petition in commerce; 8 (G) tends to cause labor disputes, as evi- 9 denced by the tens of thousands of charges filed 10 with the Equal Employment Opportunity Com- 11 mission against employers between 2010 and 12 2016; 13 (H) interferes with the orderly and fair 14 marketing of goods in commerce; and 15 (I) in many instances, may deprive workers 16 of equal protection on the basis of sex in viola- 17 tion of the 5th and 14th Amendments to the 18 Constitution. 19 (5)(A) Artificial barriers to the elimination of 20 discrimination in the payment of wages on the basis 21 of sex continue to exist decades after the enactment 22 of the Fair Labor Standards Act of 1938 (29 U.S.C. 23 201 et seq.) and the Civil Rights Act of 1964 (42 24 U.S.C. 2000a et seq.). 25 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 4 HR 7 PCS (B) These barriers have resulted, in significant 1 part, because the Equal Pay Act of 1963 has not 2 worked as Congress originally intended. Improve- 3 ments and modifications to the law are necessary to 4 ensure that the Act provides effective protection to 5 those subject to pay discrimination on the basis of 6 their sex. 7 (C) Elimination of such barriers would have 8 positive effects, including— 9 (i) providing a solution to problems in the 10 economy created by unfair pay disparities; 11 (ii) substantially reducing the number of 12 working women earning unfairly low wages, 13 thereby reducing the dependence on public as- 14 sistance; 15 (iii) promoting stable families by enabling 16 all family members to earn a fair rate of pay; 17 (iv) remedying the effects of past discrimi- 18 nation on the basis of sex and ensuring that in 19 the future workers are afforded equal protection 20 on the basis of sex; and 21 (v) ensuring equal protection pursuant to 22 Congress’ power to enforce the 5th and 14th 23 Amendments to the Constitution. 24 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 5 HR 7 PCS (6) The Department of Labor and the Equal 1 Employment Opportunity Commission carry out 2 functions to help ensure that women receive equal 3 pay for equal work. 4 (7) The Department of Labor is responsible 5 for— 6 (A) collecting and making publicly avail- 7 able information about women’s pay; 8 (B) ensuring that companies receiving 9 Federal contracts comply with anti-discrimina- 10 tion affirmative action requirements of Execu- 11 tive Order 11246 (relating to equal employment 12 opportunity); 13 (C) disseminating information about wom- 14 en’s rights in the workplace; 15 (D) helping women who have been victims 16 of pay discrimination obtain a remedy; and 17 (E) investigating and prosecuting systemic 18 gender based pay discrimination involving gov- 19 ernment contractors. 20 (8) The Equal Employment Opportunity Com- 21 mission is the primary enforcement agency for 22 claims made under the Equal Pay Act of 1963, and 23 issues regulations and guidance on appropriate in- 24 terpretations of the law. 25 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 6 HR 7 PCS (9) Vigorous implementation by the Depart- 1 ment of Labor and the Equal Employment Oppor- 2 tunity Commission, increased information as a result 3 of the amendments made by this Act, wage data, 4 and more effective remedies, will ensure that women 5 are better able to recognize and enforce their rights. 6 (10) Certain employers have already made 7 great strides in eradicating unfair pay disparities in 8 the workplace and their achievements should be rec- 9 ognized. 10 SEC. 3. ENHANCED ENFORCEMENT OF EQUAL PAY RE- 11 QUIREMENTS. 12 (a) BONA FIDE FACTOR DEFENSE AND MODIFICA- 13 TION OF SAME ESTABLISHMENT REQUIREMENT.—Section 14 6(d)(1) of the Fair Labor Standards Act of 1938 (29 15 U.S.C. 206(d)(1)) is amended— 16 (1) by striking ‘‘No employer having’’ and in- 17 serting ‘‘(A) No employer having’’; 18 (2) by striking ‘‘any other factor other than 19 sex’’ and inserting ‘‘a bona fide factor other than 20 sex, such as education, training, or experience’’; and 21 (3) by inserting at the end the following: 22 ‘‘(B) The bona fide factor defense described in sub- 23 paragraph (A)(iv) shall apply only if the employer dem- 24 onstrates that such factor (i) is not based upon or derived 25 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 7 HR 7 PCS from a sex-based differential in compensation; (ii) is job- 1 related with respect to the position in question; (iii) is con- 2 sistent with business necessity; and (iv) accounts for the 3 entire differential in compensation at issue. Such defense 4 shall not apply where the employee demonstrates that an 5 alternative employment practice exists that would serve 6 the same business purpose without producing such dif- 7 ferential and that the employer has refused to adopt such 8 alternative practice. 9 ‘‘(C) For purposes of subparagraph (A), employees 10 shall be deemed to work in the same establishment if the 11 employees work for the same employer at workplaces lo- 12 cated in the same county or similar political subdivision 13 of a State. The preceding sentence shall not be construed 14 as limiting broader applications of the term ‘establish- 15 ment’ consistent with rules prescribed or guidance issued 16 by the Equal Employment Opportunity Commission.’’. 17 (b) NONRETALIATION PROVISION.—Section 15 of the 18 Fair Labor Standards Act of 1938 (29 U.S.C. 215) is 19 amended— 20 (1) in subsection (a)— 21 (A) in paragraph (3), by striking ‘‘em- 22 ployee has filed’’ and all that follows and insert- 23 ing ‘‘employee— 24 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 8 HR 7 PCS ‘‘(A) has made a charge or filed any com- 1 plaint or instituted or caused to be instituted 2 any investigation, proceeding, hearing, or action 3 under or related to this Act, including an inves- 4 tigation conducted by the employer, or has tes- 5 tified or is planning to testify or has assisted or 6 participated in any manner in any such inves- 7 tigation, proceeding, hearing or action, or has 8 served or is planning to serve on an industry 9 committee; or 10 ‘‘(B) has inquired about, discussed, or dis- 11 closed the wages of the employee or another 12 employee (such as by inquiring or discussing 13 with the employer why the wages of the em- 14 ployee are set at a certain rate or salary);’’; 15 (B) in paragraph (5), by striking the pe- 16 riod at the end and inserting ‘‘; or’’; and 17 (C) by adding at the end the following: 18 ‘‘(6) to require an employee to sign a contract 19 or waiver that would prohibit the employee from dis- 20 closing information about the employee’s wages.’’; 21 and 22 (2) by adding at the end the following: 23 ‘‘(c) Subsection (a)(3)(B) shall not apply to instances 24 in which an employee who has access to the wage informa- 25 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 9 HR 7 PCS tion of other employees as a part of such employee’s essen- 1 tial job functions discloses the wages of such other employ- 2 ees to individuals who do not otherwise have access to such 3 information, unless such disclosure is in response to a 4 complaint or charge or in furtherance of an investigation, 5 proceeding, hearing, or action under section 6(d), includ- 6 ing an investigation conducted by the employer. Nothing 7 in this subsection shall be construed to limit the rights 8 of an employee provided under any other provision of 9 law.’’. 10 (c) ENHANCED PENALTIES.—Section 16(b) of the 11 Fair Labor Standards Act of 1938 (29 U.S.C. 216(b)) is 12 amended— 13 (1) by inserting after the first sentence the fol- 14 lowing: ‘‘Any employer who violates section 6(d) 15 shall additionally be liable for such compensatory 16 damages, or, where the employee demonstrates that 17 the employer acted with malice or reckless indiffer- 18 ence, punitive damages as may be appropriate, ex- 19 cept that the United States shall not be liable for 20 punitive damages.’’; 21 (2) in the sentence beginning ‘‘An action to’’, 22 by striking ‘‘the preceding sentences’’ and inserting 23 ‘‘any of the preceding sentences of this subsection’’; 24 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 10 HR 7 PCS (3) in the sentence beginning ‘‘No employees 1 shall’’, by striking ‘‘No employees’’ and inserting 2 ‘‘Except with respect to class actions brought to en- 3 force section 6(d), no employee’’; 4 (4) by inserting after the sentence referred to 5 in paragraph (3), the following: ‘‘Notwithstanding 6 any other provision of Federal law, any action 7 brought to enforce section 6(d) may be maintained 8 as a class action as provided by the Federal Rules 9 of Civil Procedure.’’; and 10 (5) in the sentence beginning ‘‘The court in’’— 11 (A) by striking ‘‘in such action’’ and in- 12 serting ‘‘in any action brought to recover the li- 13 ability prescribed in any of the preceding sen- 14 tences of this subsection’’; and 15 (B) by inserting before the period the fol- 16 lowing: ‘‘, including expert fees’’. 17 (d) ACTION BY SECRETARY.—Section 16(c) of the 18 Fair Labor Standards Act of 1938 (29 U.S.C. 216(c)) is 19 amended— 20 (1) in the first sentence— 21 (A) by inserting ‘‘or, in the case of a viola- 22 tion of section 6(d), additional compensatory or 23 punitive damages, as described in subsection 24 (b),’’ before ‘‘and the agreement’’; and 25 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 11 HR 7 PCS (B) by inserting before the period the fol- 1 lowing: ‘‘, or such compensatory or punitive 2 damages, as appropriate’’; 3 (2) in the second sentence, by inserting before 4 the period the following: ‘‘and, in the case of a viola- 5 tion of section 6(d), additional compensatory or pu- 6 nitive damages, as described in subsection (b)’’; 7 (3) in the third sentence, by striking ‘‘the first 8 sentence’’ and inserting ‘‘the first or second sen- 9 tence’’; and 10 (4) in the sixth sentence— 11 (A) by striking ‘‘commenced in the case’’ 12 and inserting ‘‘commenced— 13 ‘‘(1) in the case’’; 14 (B) by striking the period and inserting ‘‘; 15 or’’; and 16 (C) by adding at the end the following: 17 ‘‘(2) in the case of a class action brought to en- 18 force section 6(d), on the date on which the indi- 19 vidual becomes a party plaintiff to the class action.’’. 20 SEC. 4. TRAINING. 21 The Equal Employment Opportunity Commission 22 and the Office of Federal Contract Compliance Programs, 23 subject to the availability of funds appropriated under sec- 24 tion 11, shall provide training to Commission employees 25 VerDate Sep 11 2014 22:12 Apr 03, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H7.PCS H7 kjohnson on DSK79L0C42 with BILLS 12 HR 7 PCS and affected individuals and entities on matters involving 1 discrimination in the payment of wages. 2 SEC. 5. NEGOTIATION SKILLS TRAINING. 3 (a) PROGRAM AUTHORIZED.— 4 (1) IN GENERAL.—The Secretary of Labor, 5 after consultation with the Secretary of Education, 6 is authorized to establish and carry out a grant pro- 7 gram. 8 (2) GRANTS.—In carrying out the program, the 9 Secretary of Labor may make grants on a competi- 10 tive basis to eligible entities to carry out negotiation 11 skills training programs for the purposes of address- 12 ing pay disparities, including through outreach to 13 women and girls. 14 (3) ELIGIBLE ENTITIES.—To be eligible to re- 15 ceive a grant under this subsection, an entity shall 16 be a public agency, such as a State, a local govern- 17 ment in a metropolitan statistical area (as defined 18 by the Office of Management and Budget), a State 19 educational agency, or a local educational agency, a 20 private nonprofit organization, or a community- 21 based organization. 22 (4) APPLICATION.—To be eligible to receive a 23 grant under th [Text truncated for display. 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