Gender Pay Inequality – How Bad Is It?

Patricia Arquette made a stand at the Oscars during her acceptance speech for winning best supporting actress for the movie ‘Boyhood.’ She shined a light on the differences in gender pay, bringing the sensitive topic to the forefront. In her speech, Arquette said:

“To every woman who gave birth to every taxpayer and citizen of this nation, we have fought for everybody else’s equal rights. It’s our time to have wage equality once and for all and equal rights for women in the United States of America.”

According to an article from CNN, pay inequality is a common theme in Hollywood. The article states that last year the top ten earning actors made a combined $419 million, while the ten top-earning actresses made only a combined $226 million.

Arquette said:

“It’s important to me as an actor to be able to make a living, but I’m going to tell you something — I paid more money to my babysitter and my dog walker then I made on ‘Boyhood’ and to be in ‘Boyhood!’”

The Journal of Management Inquiry conducted a study in 2014 that found Hollywood’s actresses earn their highest wages around the age of 34, then quickly begin to earn less as they get older. Actors tend to earn their highest wages around the age of 51 and maintain them throughout their career.

Gender Pay Inequality is a Global Problem

But the pay gap isn’t happening only in Hollywood. It affects women all over the world, in all industries.

The World Economic Forum conducted a Global Gender Gap Report over a period of nine years. According to the report, the United States ranks 65th in wage equality among the participating 142 countries.

A study organized by the Institute for Women’s Policy Research (IWPR), says in the United States the “ratio of women’s and men’s median annual earnings was 78.3 percent for full-time/year-round workers in 2013” – meaning that women earn approximately 78 cents for every dollar a man earns. The IWPR estimates that if the annual gender pay ratio continues to rise with the same momentum as it has since 1960, it will take another 45 years for men and women to reach equality in pay.

What Employees and Employers Can Do

In order to help close the pay gap, one suggestion from the American Association of University Women (AAUW) is for employers to organize salary audits in order to proactively monitor and address gender-based pay differences. They also suggest that women learn better strategies for negotiating pay.

Transparency in salary is another good solution. SumAll, a data analytics company, maintains that making all of its employees’ compensation public knowledge has been beneficial because employees no longer need to worry about secret pay scales. Research supports this by finding a boost in productivity when employees are given information about everyone’s pay.

Discussing pay and salaries with coworkers is legal, protected concerted activity in the U.S. under the auspices of the National Labor Relations Act (NLRA). READ MORE: Can Employees Discuss Pay and Salaries?

Equal Pay Act of 1963 (EPA)

According to the EEOC, the Equal Pay Act:

“…requires that men and women in the same workplace be given equal pay for equal work. The jobs need not be identical, but they must be substantially equal. Job content (not job titles) determines whether jobs are substantially equal. All forms of pay are covered by this law, including salary, overtime pay, bonuses, stock options, profit sharing and bonus plans, life insurance, vacation and holiday pay, cleaning or gasoline allowances, hotel accommodations, reimbursement for travel expenses, and benefits. If there is an inequality in wages between men and women, employers may not reduce the wages of either sex to equalize their pay.”