Policy Objections
The PFA would force employers to justify their pay practices with a bona fide factor other than sex and defend it in the courts. If employees can find an alternative business practice that does not result in a pay disparity, employers must adopt it. Under the PFA, government and the courts dictate business practices to employers.
The PFA would remove the Equal Pay Acts limits on punitive and compensatory damages.
It specifies that workers are automatically members of a class-action suit unless they opt out.
Section 9 of the PFA instructs the Office of Federal Contract Compliance Programs (OFCCP) to reinstitute the Equal Opportunity Survey (EOS) and use the survey to identify federal contractors for further investigation.
o The Department of Labor discontinued this survey after concluding that it failed to identify sexual discrimination. A detailed study found that the EOS had a 93 percent false-positive rate and a 33 percent false-negative rate. Most companies identified as discriminating did not, while a third of companies discriminating were missed by the survey. The EOS did little better than random chance at identifying discrimination.
In addition to requiring the OFCCP to use a flawed survey, the PFA prevents the OFCCP from using the best science available in discrimination cases.
Economic Effects
The PFA would facilitate lawsuits and cost jobs.
o The PFA would give a windfall to trial lawyers, exposing employers to unlimited punitive damages.
o The PFA would encourage trial lawyers to initiate many frivolous class-action suits in hopes of winning a few large judgments.
o The successful lawsuits could transfer billions of dollars from employers to trial lawyers, bankrupting businesses and costing jobs.
o The increased legal risks would also reduce the incentive for business owners to start new businesses or invest in and expand their firms, costing even more jobs.
The PFA would mean millions of dollars for trial lawyers but fewer jobs for most Americans.
Under the PFA the courts would micromanage businesses.
o For instance, the courts would have to decide: Does experience constitute a bona fide factor other than sex?
o A woman earning less than a more experienced man could argue that her employer should be required to send her to training and then pay them identical wages. She would have a strong case to argue that experience was not a bona fide factor because an alternative employment practice would eliminate the disparity.
o Government micromanaging over areas in which the courts have no business expertise would reduce business competitiveness and cost jobs.