Academic journal article Monthly Labor Review

Comparable Worth: Organizational Dilemmas

Academic journal article Monthly Labor Review

Comparable Worth: Organizational Dilemmas

Article excerpt

Comparable worth has emerged as a major equal employment opportunity issue of the eighties. This issue is extremely controversial because it challenges traditional wage setting practices. What should be the basis for wage setting in our society? Should wages reflet supply and demand forces, or should they reflect the contribution individuals make to their employers?

To a certain extent, the answers to these questions are philosophical in that they reflect individual and cultural values. These questions also have important political and economic dimensions. It is not surprising that some observers describe comparable worth as a policy that could have dire economic consequences. Nor is it suprising that advocates see the issue in moral and ethical terms, and as fundamental and necessary part of equal employment opportunity.

It is not yet clear how Federal courts will judge comparable worth claims brought under Title VII of the Civil Rights Act of 1964. Regardless of how the courts view comparable worth, public awareness fo the issue is growing and has sparked the interest of women concentrated in primarily bargaining issue, and pay equity salary increases have been included in some settlements. In addition, a number of States and municipalities have either commissioned comparable worth studies or passed legislation requiring that public sector wages be based on comparable worth.

Comparable worth could have a major effect on many organizations. This article identifies organizations likely to be affected and analyzes the issues these organizations will face. Public and private employer organizations are included in the discussion, as well as labor unions.

Background

Although the 1963 Equal Pay Act and Title VII of the Civil Rights Act of 1964 became law over two decades ago, women working full time continue to earn about one-third less than men working full time. This gap has been both consistent and persistent. Much empirical research indicates that the major reason for the gap is the concentration of women in low-paying occupations.

The current labor force participation rate for women is approximately 53 percent, almost double what it was two decades ago. About 80 percent of the women in the labor force work in 25 of the 420 distinct occupations identified by the U.S. Department of Labor. Many of these jobs are generally filled by women. For example, about 99 percent of secretaries, 85 percent of registered nurses, 82 percent of librarians, and 86 percent of clerks are women. The wages for these and similar "female jobs" are the focus of the comparable worth debate.

Wage adjustments based on comparable worth could affect the wages of a large proportion of women workers, as well as the wages of men working in female-dominated jobs. Thus, many employers view the pososible economic consequences of comparable worth with gave concern. Predictions include increased labor costs, with resulting price increases and unemployment, particularly within job categories allocated comparable worth increases. In contrast, advocates of comparable worth see its potential to bolster both the economic and political power of working women. Some observers cite possible sociological implications as well, for increasing the pay for female jobs may raise the status of these jobs and of women's work in general.

Because comparable worth may result in significant economic, political, and sociological change, it could affect the external environment in which many organizations function. Organizations affected by comparable worth also will face changes in the internal environment involving dilemmas, constraints, and opportunities.

Employer organizations

External environment. An employer's task environment includes the economic, political, sociological, and technological trends outside the organization that affect its functions. Currently, the majority of employers evaluating wages on the basis of job content and implementing comparable worth adjustments are in the public sector. …

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