What is Wage Discrimination?

Your questions about workers’ rights, answered

Wage discrimination could cost you thousands of dollars each year – or even more. Also known as pay discrimination or compensation discrimination, wage discrimination violates your rights.

But what is wage discrimination? How can you prove pay discrimination? And can you file a lawsuit for unfair payment practices?

You have the right to receive equal pay for equal work. For example, paying a woman less than a man for the same work is against the law.

Paying employees less because of their race, age, or religion also violates equal pay laws. 

Keep reading to learn more about wage discrimination.

What is wage discrimination?

Wage discrimination means paying someone less because of their gender, race, age, or religion.

Paying an employee less because of any protected characteristics violates the law. For example, paying women less than men for the same work qualifies as wage discrimination.

Men can also be victims of wage discrimination if they receive lower pay because of their race, age, disability status, or another protected class.

Employers cannot pay you less for a discriminatory reason. However, two employees doing the same work might make different salaries for legal reasons like experience or longevity.

Check out our equal pay and wage discrimination resources for more wage discrimination examples. 

What is equal pay compensation discrimination?

Equal pay compensation discrimination means paying an employee lower wages because of their gender, race, religion, age, or disability. It’s also discriminatory to pay someone less because of their national origin, sexual orientation, or any other protected characteristic.

Federal, state, and local laws protect workers from pay discrimination. These laws include the federal Equal Pay Act and New York Equal Pay Laws.

Victims of discrimination in pay can contact an employment lawyer to file a lawsuit.

What are unfair wages?

Unfair wages mean an employer does not fairly compensate their workers.

The category “unfair wages” covers several types of workplace violations, including wage theft, failing to pay minimum wage, or withholding overtime pay.

Discrimination in compensation also qualifies as unfair wages. Federal, state, and local laws prohibit paying employees unfair wages.

If your employer has unfair payment practices that violate the law, you can file a lawsuit to recover lost wages.

What is the law on equal pay for equal work?

At the federal level, the Equal Pay Act of 1963 states that employers must pay men and women equal pay for equal work.

Employees do not need to hold identical job titles or perform identical work functions to receive equal pay. If their jobs are “substantially equal,” employees should receive equal pay. 

Victims of unequal pay can file a claim with the U.S. Equal Employment Opportunity Commission.

What is comparable worth?

Comparable worth, also known as pay equity, is a way to pay employees fair wages for the work they’re providing. It’s a way to avoid unequal pay or wage discrimination.

What is pay equity in practice? Companies perform a pay equity analysis to determine the salaries for particular job functions, skills, and responsibilities. A pay equity analysis, also called an equal pay audit, can determine if some employees aren’t receiving fair compensation.

How much is the average discrimination lawsuit?

The amount awarded in a discrimination lawsuit varies depending on the facts of the case, the person’s job title, and their legal representation. The location can also influence the award. 

In New York, the average employment discrimination award for pain and suffering was $200,000, while the average award for punitive damages was $460,000, according to a study by Professor Vivian Berger. Many cases also settle before they reach court. 

What is compensation discrimination?

Compensation discrimination, another way of saying wage discrimination, means paying an employee less than coworkers who perform the same jobs.

It is against the law for an employer to pay an employee less because of his or her gender, age, race, disability status, or religion. Federal, state, and local laws protect employees from compensation discrimination.

Compensation discrimination can also include differences in benefits or other parts of the total compensation package. For example, denying health insurance to female employees while offering it to male employees can qualify as compensation discrimination.

How much does a woman make to a man’s dollar?

Women made approximately 82 cents for each dollar earned by a man in 2022.

This translates to a nearly 20 percent gender wage gap. The gender pay gap is even larger for women of color.

Even when comparing men and women in the same roles, women tend to earn less than men. Paying women less than men for the same work violates the federal Equal Pay Act and New York state compensation discrimination laws.

What is Title VII?

Title VII of the Civil Rights Act of 1964 provides important worker protections, including protections against wage discrimination, employment discrimination, and other unlawful employment practices.

For example, Title VII states that employers cannot discriminate against employees in compensation, hiring, or benefits because of the employee’s race, color, religion, sex, or national origin.

What does it take to sue for gender pay discrimination and win?

Are you wondering how to prove pay discrimination? 

Victims of discrimination in pay because of gender can increase their chances of winning their case by documenting job descriptions, data on pay, and any other evidence of lower pay. Women paid less than male coworkers may also be able to ask a coworker to testify on their behalf.

Contact an employment lawyer for a free consultation to learn more about how to prove wage discrimination. 

What is the New York Equal Pay Law?

New York State Labor Law states that employers cannot pay a lower rate to female employees who perform work equal to the company’s male employees. New York’s Equal Pay Laws also state that employers cannot stop employees from discussing or disclosing their wages.

If you’ve experienced Equal Pay Act violations, you can file a lawsuit. Employers cannot retaliate against employees for filing complaints about pay discrimination.

What is the New York State Fair Pay Act?

The New York State Fair Pay Act states that employers cannot pay different wages to employees with the same job because of their sex, race, or national origin.

The New York State Assembly passed the legislation in April 2018. The Fair Pay Act strengthens worker protections against compensation and pay discrimination across New York state.

What is the New York Pay Equity Law?

The New York Pay Equity Law, updated in 2019, bans salary history inquiries and prohibits pay inequities based on race, gender, or another protected category.

Most equal pay laws require “equal pay for equal work.” The New York pay equity law goes beyond that standard to require equal pay for “substantially similar work.”

Victims of pay inequities can file a lawsuit to recover four times the amount they were underpaid in backpay plus damages.

Who does the Equal Pay Act protect?

The Equal Pay Act covers nearly all workers in the country. The federal law applies to all federal, state, and local government employees as well as most private employees.

The Equal Pay Act requires that employers pay men and women equally for equal work. The Equal Pay Act became law in 1963.

What does the Equal Pay Act cover?

The Equal Pay Act of 1963 protects nearly all employees in the country from receiving lower pay because of their sex.

For example, employers cannot pay female drivers less than male drivers, or pay female airline pilots less than male airline pilots. If employers violate the law, employees can file a claim with the EEOC or contact an employment lawyer.

What is equal pay for equal work?

The Equal Pay Act states that women must receive equal pay for equal work. Paying a woman less than a man when performing the same job violates the law.

Equal pay isn’t exactly the same as the gender wage gap, though they are related. The gender wage gap also factors in unequal pay for unequal work – for example, women in education earning less than men in finance. But when women make less for the same work, it violates equal pay laws.

In addition to federal laws, state laws like the New York State Fair Pay Act also require equal pay for equal work.

Can New York City employers ask for your salary history?

No; in New York City, employers cannot ask potential hires for their salary history.

Requiring salary history can reinforce pay inequalities, which particularly harm women and people of color. For example, white women on average earn about 80 cents for every dollar a man earns, while black women earn 63 cents and Latina women earn 54 cents.

In New York City, if an employer asks for your salary history, you can file a claim.

What can you do about pay discrimination?

Wage discrimination remains a major problem in the workforce. For example, because of gender pay discrimination,  women earn less than their male coworkers in multiple industries.

Victims of compensation discrimination can file a claim with the EEOC, the New York State Division of Human Rights, or the New York City Commission on Human Rights. You can also contact an employment lawyer for a free consultation.

Learn more about New York equal pay laws and how to file a claim.