Alabama to adopt the New Act on Equal Pay

Alabama to adopt the New Act on Equal Pay

The State of Alabama is now the 49th state of the United States to pass a House Bill 225 on an equal pay among employees. The State finally passed this important legislation to ensure more equality at workplace. Having signed by Governor Kay Ivey on June 11, 2019, the law would be effective from September 1, 2019. As per the Equal Pay Act (EPA), the employer now is prohibited from discriminating against its employees on the basis of sex and race for payment of wages for a similar work being done by another employee at a higher wage rate. Section 1 (a). The EPA emphasizes on the equal treatment of employees with similar skill, effort, education, experience, and responsibility.  The dissimilarity could only be done on the basis of seniority, merit system, quality and quantity of production of work and on any factor other than race or sex. Section 1 (a) (1).

This law will bring awareness among employees or workers about their rights in the establishment. They will have the full right to stand up against their employer, if there is a discrimination being done against them. They can file a suit whenever discrimination exists.

The EPA also obligates the employers to adopt the rules of recordkeeping established by the United States Department of Labor for the Fair Standards Act (FLSA), Title 29, Part 516 of the Code of Federal Regulations. Section 1 (a) (3) (c). This rule being imposed on every employer not limited by number of employees, gross income, or type of business – will now be onerous.

However, the employers with large organizations and those who are operating in specific industries (such as bars and restaurants), are already keeping such records for the reason that they are subject to the FLSA.

Although the EPA does not provide any penalty for employers who fail to comply with the recordkeeping requirement, but that does not allow them to not oblige the law.

The Act also prohibits the employee a double recovery (Section 1 (a) (3) (d)) from a state and federal lawsuit, where if an employee loses its case, will have to rejoin the employer, unless otherwise stated in their agreements with the employee. Instead of seeking help from the federal court, the new law will either provide the employee an opportunity to file the claim in state court and get a jury trial within his county, rather than a federal district; or that the state court judge might send the case to the jury.

Post the new law coming into effect, it is advisable for all employers in Alabama to recheck their payroll records to avoid any questions on discrimination, if any, raised by their employees. A review of their pay practices would identify any loophole in their records, which might otherwise put them into a conflicting situation with their employee under the new law.