NYC bill takes aim at gender pay gap at large companies

Big employers in New York City would be required to file annual reports with the municipal government to detail, by demographic characteristic, how much workers are paid, under legislation expected to be passed on Thursday by the City Council.

Characters required to be tracked and disclosed include gender, job category, race and ethnicity.

Another component of the legislation would require the city to conduct an "annual pay equity study."

The legislation, which covers private employers who have 200 or more workers, is aimed at narrowing gaps in pay by demographic characteristic.

The study required under the bill "must analyze whether disparities in compensation exist by gender, race, and ethnicity, identify industries where inequities are most prevalent, and track trends in occupational segregation."

The legislation, Introduction 982 and 984, covers private employers. The city already has a disclosure requirement for municipal workers, according to Arden Dressner Levy, spokesperson for Councilmember Tiffany Cabán, one of the legislation's sponsors.

Failing to supply the required information will subject companies to an escalating enforcement system that includes written warnings, as well as fines up to $5,000 and "annual public disclosure on a city website of those who refuse to comply."

The cause of the gender pay gap is a subject of academic debate, and it shrinks or grows depending how it’s calculated. A woman on average makes 84 cents for every dollar a man makes, according to some studies; it's 97 cents based on others, for recent college grads.

A key issue: Do the formulas simply average out salaries for men and women, or do they control for job type, time in the workforce, parental leave taken, hours worked and propensity, or reluctance, to negotiate.

Earlier this year, the consulting company McKinsey found that almost 80% of the gender pay gap in the United States is driven by female workers with "flatter work experience arcs compared with men."

For example, men and women have "diverging work experience patterns" and women "accumulate less time on the job than men," the report said.

"Women average 8.6 years at work for every ten years clocked by men because, on aggregate, they work fewer hours, take longer breaks between jobs, and occupy more part-time roles than men," the report said, adding: "Women are more likely than men to switch to lower-paying occupations, typically ones involving less competitive pressures and fewer full-time requirements."

A study led by Kristi Minnick, a Bentley University finance professor, identified what she said was systemic, sexist causes. The study focused solely on women who work in executive-level positions.

"Gender wage differentials are directly attributable to a population’s cultural beliefs and attitudes toward women," she said.

Even among women themselves, there is a disparity: white women make more than Black and Hispanic women. 

In a statement announcing the bill, the New York City Council members say that in Europe, similar reporting requirements have reduced the pay gap.

By Matthew Chayes

matthew.chayes@newsday.comchayesmatthew

Matthew Chayes, a Newsday reporter since 2007, covers New York City.