Kamala Harris, a Senator and Democratic presidential candidate, said she wants to punish companies that pay men more than women.
Her campaign announced the policy on Monday where she said she wanted corporations to “pay women fairly or pay the price,” the Associated Press reports.
“We’ve let corporations hide their wage gaps, but forced women to stand up in court just to get the pay they’ve earned. It’s time to flip the script and finally hold corporations accountable for pay inequality in America,” the campaign continued.
According to the report, corporations would be required to report overall equal wages “regardless of job titles, experience, and performance.”
According to the plan, corporations with more than 100 employees will be required to earn an equal pay certification:
To receive certification, companies must demonstrate they have eliminated pay disparities between women and men who are doing work of equal value. To the extent pay disparities do exist for similar jobs, companies will be required to show the gap is based on merit, performance, or seniority–not gender.
They will also be required to report the overall pay and total compensation gap that exists between men and women, regardless of job titles, experience, and performance. These statistics will be reported by employees’ race and ethnicity.
Under our plan, companies that fail to receive “Equal Pay Certification” will face a fine for every day they discriminate against their workers.
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This fine will be assessed based on a company’s average wage gap for work of equal value. For every 1% gap that exists after accounting for differences in job titles, experience, and performance, companies will be fined at 1% of their average daily profits during the last fiscal year. We estimate the plan will generate roughly $180 billion over 10 years, with revenue decreasing over time as strong equal pay practices become part of corporate culture.
Here’s more from the Associated Press:
The equal pay plan is the latest proposal from Harris, who has been seeking a break-out moment in a crowded field of Democrats seeking the party’s nomination. Earlier, she outlined a plan that would raise pay for teachers nationwide, and she has also focused on housing affordability. However, she has lagged behind Massachusetts Sen. Elizabeth Warren, who has been the policy pace-setter among the Democratic field.
In Harris’s equal-pay plan, the campaign says, companies would be prohibited from asking about prior salary history as part of their hiring process, banned from using forced arbitration agreements in employment contracts for pay discrimination matters, and would be required to allow employees to freely discuss their pay. They would also be required to report the share of women who are among the company’s top earners, the total pay and total compensation gap that exists between men and women, regardless of job titles, experience and performance.
Several studies have shown that women earn less than men, with the gap larger for Latinas and black women. Harris previewed the plan at a Sunday rally in Los Angeles, taking aim at the pay gap. “This has got to end!” she said.
Embedded in the white paper is an overhaul of anti-discrimination laws and an expansion of discrimination investigations.The proposal also comes with another stick, of sorts: If Congress doesn’t enact on the sweeping policy, Harris plans to take executive action applying the standards to certain large federal contractors.
Unequal pay has often been cited by a 2020 Democratic field that features a record number of women. Yet, while others have called for increasing transparency among corporations — including required reporting of their wage gap — experts including New America’s Vicki Shabo told POLITICO that Harris’ policy is the most specific.