The First Equal Pay Act Knew Only Where to Look. Your Data Might Too.

Equal Pay Act, 1963 — What the Act Prohibited and What It Missed

The Equal Pay Act prohibited employers from differentiating pay based on sex for “substantially equal work” within the same establishment. It was an amendment to the Fair Labour Standards Act of 1938 — its passage required years of work by Congresswoman Edith Green, Senator Maurine Neuberger, and the President’s Commission on the Status of Women, chaired by Eleanor Roosevelt. The courts quickly clarified the boundaries. In Corning Glass Works v. Brennan (1974), the Supreme Court ruled that higher rates for men working nights did not justify the difference - the time of day does not create a “different  job”. In Schultz v. Wheaton Glass Co. (1970), the court rejected minor differences in duties as a pretext for paying women less. "Substantially equal work" is the forerunner of today's definition of worker categories under Directive 2023/970. The scope was then narrow: the same establishment, the same role.  Today, pay must be compared across groups of jobs of equal value — regardless of job title or department. If your job evaluation methodology still relies on title rather than the value of the work, that is the first point to review.

One Axis of Measurement — and What Passes Through Unnoticed

The most important lesson from 1963 does not come from the courtroom. It comes from 1976 — from the case of  De Graffenreid v. General Motors.  GM was the first to lay off its Black female employees. When they brought a discrimination claim, the court dismissed it: they were not being discriminated against “as women” (because white women retained their jobs) nor “as Black people” (because Black men retained their jobs). Discrimination at the intersection of race and sex was legally invisible. In 1989, legal  scholar Kimberlé Crenshaw termed this mechanism intersectionality. A law that measures one axis protects  those who need the least protection. Your pay gap reporting may be doing exactly the same. The data confirm this. In the United  States, a white woman earns approximately 83 cents for every dollar earned by a white man. A Black woman — 65 cents. A Latina — 58 cents. (NWLC, 2024,  full-time.) The gap is not uniform. It is layered — and depends on how many axes you measure simultaneously.  Research by Bertrand and Mullainathan (2004) shows how early this mechanism operates:  identical CVs with a “white-sounding” name received 50% more interview invitations than those with a name associated with a Black person. The pay  gap begins before a candidate walks through the door. Directive 2023/970 requires pay gap reporting broken down by worker category and pay quartile, but it does not specify how many demographic axes you must analyse. Minimum compliance is one thing. An accurate picture of your organisation is another. If your data show only an overall gap (women vs. men), you may report zero and still have a serious problem within specific worker groups.

What the 1963 Act Says About Your Compensation System

The Equal Pay Act set in motion a logic that Directive 2023/970 takes to the next stage. The progression is straightforward: 1963: prohibition on pay differentiation for the same work, same establishment. 1975: extension to work of equal value (Directive 75/117/EEC). 2006: the burden of proof shifts to the employer (Recast  Directive). 2023: obligation of transparency and reporting — regardless of intent. Each step expanded what the law can see. In 2027, it will see your organisation — through the lens of the data you publish. The question for Comp & Ben is: “Where is our gap — and do we know  about it before we publish the report?”

Three audit questions before your first  report:
1. Does your job evaluation methodology rest on the value of work, not job title?
2. Do you analyse pay data across more than one demographic variable?
3. Do you have a ready answer to: “Why does X earn less than Y in  the same category?”

Sources:
EqualPay Act of 1963 (Pub. L. 88-38); Fair Labor Standards Act of 1938. CorningGlass Works v. Brennan, 417 U.S. 188 (1974). Schultz v. Wheaton Glass Co., 421F.2d 259 (3rd Cir. 1970). DeGraffenreid v. General Motors, 413 F. Supp. 142(E.D. Mo. 1976). K. Crenshaw, University of Chicago Legal Forum, 1989. NWLC,The Wage Gap, 2024. Bertrand & Mullainathan, American Economic Review,2004.

This article is part of the Mind the Pay Gap: World Tour series — Levelly.ai's educational campaign dedicated to Directive 2023/970 and compensation strategy aligned with the principle of equal pay. Join the Mindthe Pay Gap tour.

Readon: Act III · EU 1975 — “work of equal value” and the adjusted pay gap.