Oregon Governor Kate Brown has signed H.B. 2005 into law, also known as the Oregon Equal Pay Act of 2017. This law aims to reduce persistent pay inequities, and also provides a safe harbor for employers that have voluntarily assessed their pay practices to identify and eliminate discriminatory actions.
Under the OEPA, employers may not “in any manner discriminate between employees on the basis of protected class in the payment of wages or other compensation for work of comparable character.” This includes paying “wages or other compensation to any employee at a rate higher than that at which the employer pays wages or other compensation to employees of a protected class for work of comparable character.” The following are key provisions:
- Employers may not ask an applicant how much he/she is currently paid;
- Employers may not base a new hire’s pay on that individual’s current or past compensation;
- Employers may not comply with the Equal Pay Act by cutting a current employee’s pay.
However, employers may pay employees for work of comparable character at different compensation levels if the difference is due to a bona fide factor related to the position based on:
- A merit system
- A system measuring earnings by quantity or quality of production (e.g. piece-rate work)
- Workplace locations
- Travel (if necessary and regular for employees)
Employers that violate the Equal Pay Act may be liable to employees for unpaid wages. Employees may seek redress by either filing a complaint with Oregon’s Bureau of Labor and Industries (“BOLI”), or by bringing a lawsuit against their employer directly. There is no exhaustion requirement mandating the filing of a complaint with BOLI prior to bringing a lawsuit.
Compensatory and punitive damages are also available upon a showing of an employer’s fraud, malice, or willful and wanton misconduct. However, an employer is entitled to file a motion to disallow an award of compensatory and punitive damages, which shall be granted if the employer demonstrates, by a preponderance of the evidence, that it: (1) completed, within three years before the date that the action was filed, an equal-pay analysis of the employer’s pay practices in good faith that was reasonable in detail and scope, and related to the protected class asserted by the plaintiff; and (2) eliminated the wage differentials for the plaintiff and has made reasonable and substantial progress toward eliminating wage differentials for the protected class asserted by the plaintiff. In light of this provision, employers should consider voluntarily conducting equal-pay analyses to identify and rectify instances of pay discrimination.
The bulk of the Equal Pay Act’s provisions become operative on January 1, 2019, giving employers time to address any existing pay disparities.