Compensation

The Equal Pay Act of 1963 is an extension of the Fair Labor Standards Act. “The Equal Pay Act forbids wage discrimination on the basis of gender if employees perform equal work in the same establishment” (Milkovich, Newman and Gerhart, 2011, p. 591). This act is very important for all businesses to understand because supports a balanced and fair salary structure for all staff. An important part of this act is that the fact that it requires that men and women be given equal pay for equal work, within the same establishment. “The jobs do need not be identical, but they must be substantially equal” (Milkovich, Newman and Gerhart, 2011, p. 591).

I work for a large, non-profit organization where I am the Director of Human Resources. Within this specific organization, approximately 75% of the staff are women. This act is a very important resource for the fair implementation of employee salaries. In my opinion, the importance of this act in the current business sector is huge because discrimination in all forms, has been a troubling concern for many years. In the past, men were considered the bread winners and were often times compensated with a higher salary than a woman doing the same exact job. In recent years, the gap in pay between males and females closed slightly, but is far from perfect.

Considering the history of this topic, I would strongly suggest that the management team in any organization, pay close attention to this law as it promotes equality among staff members. Equal pay for all employees is a great tool for the implementation of HRM practices. Equal pay will allow employees to feel as they are being rewarded for their education, experience and skill-set in a fair manner. An employee who is happy in their job will more often feel motivated to perform at their very best, therefore increasing overall productivity. A strong feeling of pride among employees can strongly influence overall employee morale.

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