When Equal Pay Is Not Enough: The Influence of Employment Discrimination on Health Disparities

Women are making inroads into the upper echelons of academia, business, and entertainment, yet pay inequities persist. Advocates fighting for women’s equal pay should consider the effect that unequal pay has on women’s health status, especially on the health of women of color, who tend to have greater health disparities than other women.^1,2 Research shows that when women were paid less than their male counterparts, women had higher odds of depression and anxiety than their male counterparts.³ These health effects may not be fixed through efforts to achieve equal pay that focus on pay history and negotiation training.^4-9 For example, pay disparities are often attributed to women’s failure to negotiate. However, studies show that women and men in racial minority groups are penalized for trying to negotiate higher pay.^8,9

In employment law, sex is the term used to discuss the differences between women and men; in health, gender is the term used to discuss this difference. Throughout this article, sex is used to discuss the difference between women and men.¹⁰ Even though Latino is considered an ethnicity for health disparities, it is treated as a race or national origin in employment discrimination cases.^10,11 Thus, for the purposes of this article, Latino is treated as a race, so race is the term used for racial and ethnic health disparities.

In this installment of Law and the Public’s Health, we review studies that show the persistence of pay inequities by sex and race, gaps in the scope of civil rights laws that prohibit pay inequities, and the influence of these inequities on health disparities. We conclude with proposed solutions and areas in need of additional research.

Sex and Racial Inequities in Pay

Regardless of the occupation, pay inequities by sex persist (Table).¹² The differences are even starker when race is also considered. For example, in 2018, white male primary care physicians reported making an average of $335 000 compared with $250 000 for white female primary care physicians, $234 000 for Asian female primary care physicians, $225 000 for African American female primary care physicians, and $223 000 for Latino female primary care physicians.¹³

Table.

Comparison of median annual salaries, by sex, United States, 2016^a

Occupation	Median Annual Salary, $		% of Women’s Salary Compared With Men’s Salary
	Women	Men
Physicians and surgeons	166 388	231 420	71.9
Chief executives	103 564	141 108	73.4
Lawyers	122 073	136 043	75.3
Education administrators	64 509	80 380	80.3
Registered nurses	64 413	70 952	90.8

^aData source: US Department of Labor.¹²

Furthermore, when comparing wages by education, women of color earn less than men with the same or less education.¹⁴ For example, in 2017, African American women with an advanced degree, such as a master’s degree, made $17 less per hour than did white men with an advanced degree and $7 less per hour than did white men with a bachelor’s degree.¹⁵ In addition, a white man with a bachelor’s degree or higher made $80 974 annually, almost $30 000 more than an African American woman with a bachelor’s degree or higher.¹⁶ In fact, Native American women need a master’s degree before they surpass the wages of a white man with only a high school degree.^17,18

Research, including surveys conducted at the Massachusetts Institute of Technology and Columbia University, has shown that female professors provide more service to their universities than do male professors, yet female professors are paid less than male professors are paid.^19-23 In 2015, male full professors earned an average annual salary of $113 766, whereas female full professors earned an average annual salary of $95 692.²³ In addition, a 10-year study of newly trained physicians in New York State found a $16 819 pay gap between female and male physicians in 2008, which could not be explained by specialty choice, practice setting, work hours, or other characteristics.²⁴

Gaps in Civil Rights Laws

Although research shows that regardless of occupation, women receive lower pay than men for the same or more work, gaps in the scope of civil rights laws prevent this problem from being rectified. Title VII of the Civil Rights Act of 1964 prohibits discrimination in compensation based on race or sex, and the Equal Pay Act of 1963 prohibits differential pay based on sex between women and men working in the same establishment who perform jobs that require substantially the same skill, effort, and responsibility.^10,25 To prove a violation of Title VII or the Equal Pay Act, a woman must show evidence that a specific employer intentionally discriminated against her in terms of pay (disparate treatment) or that a specific employer’s actions disproportionately affected her by showing statistically significant differences in pay between women and men (disparate impact).²⁶ Employers prohibit employees from sharing data on salaries, the government does not collect data on salaries, and employers are not required to disclose data on salaries. Thus, without publicly available data to show disparate treatment or impact by a specific employer, it is difficult for a woman to prove that she is receiving unequal pay compared with a man who is doing the same job for the same employer.

Even when a woman can prove unequal pay due to disparate impact, an employer can prevail by showing a job-related or business-necessity justification.¹⁰ Some courts allow employers to use an employee’s pay history as a job-related defense for unequal pay, even if the woman is working in the same establishment and performing a job that requires substantially the same skill, effort, and responsibility as that of a man.^27,28 In 2018, the 9th Circuit Court of Appeals ruled that using prior pay as a job-related defense is prohibited because prior salary is not a legitimate measure of work experience, ability, performance, or any other job-related quality.²⁹ Although the Supreme Court overturned this opinion because the author of the opinion died before it was published, states such as California, Hawaii, and Oregon have passed equal-pay laws banning employers’ use of pay history to determine salary.^5-7,30

Notwithstanding a ban on pay history, cases show that employers also continue to pay women less than they pay men based on unsubstantiated claims that women are not performing as well as men, which will continue without clear legal standards.^31-33 For example, in 2013, the University of Denver Strum College of Law formally recognized the existence of pay disparities between female and male professors since 1976, yet it decided not to pay the women equally based on unsubstantiated claims that the women “were not performing as well as male professors.”³⁴ Five years later, the University of Denver agreed to pay $2.66 million and increase the salaries of the 7 female professors who participated in the lawsuit, as well as annually publish salary information and employ an economist to conduct an annual compensation equity study.^34,35 However, the settlement does not require the University of Denver to clearly address problems with its unsubstantiated claims that women “were not performing as well as male professors.” As such, these same claims could be used in the future to pay women less than men.

Moreover, women of color are paid less than men and other women because of the intersection of sex and racial discrimination, which is not addressed under Title VII, the Equal Pay Act, or current state equal-pay laws. Many courts refuse to recognize the intersection of race and sex discrimination that women of color face in Title VII claims, limiting them to discrimination claims based on race or sex.^26,36 Some courts have allowed claims based on a sex-plus theory that allows women of color to argue discrimination based on sex and race, yet scholars argue that the sex-plus theory makes race discrimination secondary to sex discrimination.³⁷ Federal and state equal-pay laws prohibit only sex discrimination, so women of color who challenge pay disparities are compared with their male counterparts, not with white men who are making the most. These gaps in civil rights laws allow unequal pay to continue.

Impact on Health Care Status

Experiencing discrimination at work has been associated with poor mental health for all populations, including women of color. A 2016 study observed a sex disparity in depression and anxiety disorders when women earned less than their male counterparts, which was substantially reduced when women earned more than their male counterparts.³ In addition, research shows that experiencing sex and race discrimination is associated with psychological stress for women of color.³⁸ Perceptions of workplace discrimination are also associated with poor mental health for women.³⁹

Proposed Solutions and Suggestions for Future Research

Using mandatory pay reports of government contractors, the Office of Federal Contract Compliance Programs, part of the US Department of Labor, has fined Oracle, Dell, and other companies for unequal pay based on sex or race, placing the burden of proof on employers to show that unequal pay is based on qualifications or workload.^40-42 The US Equal Employment Opportunity Commission, which is in charge of enforcing Title VII and the Equal Pay Act, should adopt this mandatory reporting process and shift the burden of proof to the employer. However, the Equal Employment Opportunity Commission also needs to consider unequal pay based on sex and race in this process.

Furthermore, Congress should pass the Paycheck Fairness Act, which was first introduced in 1997.⁴ The Paycheck Fairness Act would require the Equal Employment Opportunity Commission to collect confidential pay-related data and the US Department of Labor to create a data collection system to identify trends in pay. The Paycheck Fairness Act would also prohibit the use of pay history to set current wages and retaliation against employees inquiring about or disclosing pay, while imposing civil penalties (from $5000 to $10 000) and individual penalties not to exceed $10 000 plus attorneys’ fees.

However, more needs to be done. The data collected by the Equal Employment Opportunity Commission should be publicly available to employees so that women who want to bring a case against an employer will have access to the data. In addition, the data need to be disaggregated by sex and race as well as workload, so that women of color can use the data to bring lawsuits against employers. The penalties should include costs for poor health associated with experiencing discrimination. Title VII should also be revised to allow claims based on sex and race.

Finally, more research should be conducted on multiple forms of discrimination (eg, sex and race discrimination), unequal pay, and the influence of employment discrimination on the health status of women, similar to research showing that the enforcement of civil rights laws can decrease racial health disparities.⁴³ Studies on discrimination by sex and race, access to health care, negative work outcomes, poor health status, and use of health care services should also be conducted. Moreover, studies must track women from age 25 to 64, which are the ages during which the pay gap between women of color and white men is greatest.^14-17 These studies can support important changes in laws and employer policies.