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«A Paper Series Celebrating the 50th Anniversary of American Women: Report of the President’s Commission on the Status of Women A Paper Series ...»

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A Paper Series Celebrating the 50th Anniversary of

American Women: Report of the President’s

Commission on the Status of Women

A Paper Series Celebrating the 50th Anniversary of

American Women: Report of the President’s

Commission on the Status of Women

This paper series was prepared with funding from the U.S. Department of Labor. The views

expressed are those of the authors and should not be attributed to the Federal Government or the

Department of Labor.


Latifa Lyles, Women’s Bureau, U.S. Department of Labor The New Mexico Pay Equity Initiative-A Template for Narrowing the Gender Pay Gap

Martha Burk, Center for Advancement of Public Policy Women, jobs and opportunity in the 21st century

Anthony P. Carnevale, Georgetown University Nicole Smith, Georgetown University Changing Families, Changing Work

Ellen Galinsky, Families and Work Institute Anne Weisberg, Families and Work Institute Occupational Segregation and the Gender Wage Gap: A Job Half Done

Ariane Hegewisch, Institute for Women’s Policy Research Heidi Hartmann, Institute for Women’s Policy Research Paid Parental Leave in the United States

Heidi Hartmann, Institute for Women’s Policy Research Lindsey Reichlin, Institute for Women’s Policy Research Jessica Milli, Institute for Women’s Policy Research Barbara Gault, Institute for Women’s Policy Research Ariane Hegewisch, Institute for Women’s Policy Research Women and Work: 50 Years of Change since the American Women Report

Lisa Maatz, American Association of University Women Anne Hedgepeth, American Association of University Women Policy, Education and Social Change: Fifty Years of Progress

Catherine Hill, American Association of University Women Erin Prangley, American Association of University Women Low Wages and Scant Benefits Leave Many In-Home Workers Unable to Make Ends Meet........ 238 Heidi Shierholz, Economic Policy Institute The Next Frontier: Preventing and Litigating Family Responsibilities Discrimination.................. 269 Joan Williams, University of California, Hastings College of Law Today’s Schedules for Today’s Workforce: Hourly Employees and Work-Life Fit

Joan Williams, University of California, Hastings College of Law

–  –  –

General Description: This paper describes the New Mexico Pay Equity Initiative, which was instituted by Governor Bill Richardson’s administration over a two year period (2009-2011). The Initiative built on recommendations from an Equal Pay Task Force created by the New Mexico State legislature in 2003, and a subsequent task force created by the governor in 2008. The paper discusses the rationale, policies, methodology and outcomes of the initiative, highlighting it as one way to serve the goal of achieving pay equity as embodied in the Paycheck Fairness Act and the Fair Pay Act, and also to advance the goal of government accountability and transparency. Implications for the future development and replication by other entities are included.

Women’s Bureau goals addressed: 1) reflect upon and celebrate the accomplishments of public policies related to women, and 2) highlight present day issues and future DOL policy priorities around women's rights and opportunities in the workplace.

Importance: The New Mexico Pay Equity Initiative requiring gender pay equity reports of entities seeking contracts with the state is the only one of its kind in the country. It is a significant effort, and took two years to implement following earlier task forces and sets of recommendations. It can serve as a template for other government entities is advancing pay equity.

Key words: women, gender pay gap, contracting, executive orders, pay equity, equal pay

–  –  –

In 2003 the New Mexico state legislature created an Equal Pay Task Force to explore the problem of wage disparities in the state between men and women and between minorities and nonminorities, in both the public and private sectors. The Task Force issued a report with a number of recommendations (including pay equity legislation which advocates had been working to bring about for years) which were not immediately acted upon.

After concluding that legislation had little chance of passing, and that the governor had the authority to act by Executive Order (EO), in 2008 Governor Bill Richardson issued an Executive Order declaring pay equity a priority for the State of New Mexico. The EO created a second Task Force, which consisted of directors and senior personnel from relevant state cabinet departments, non-profit organizations concerned with pay equity, and members of the private sector representing business interests. (Appendix III) The Task Force recommended a preliminary study of gender pay gaps and job segregation of the state classified workforce in some representative departments, to be followed by a study of all departments.1 Governor Richardson appointed a nationally recognized expert as Senior Advisor on Women's Issues to direct and carry out the study with support from the Office of State Personnel.

In September 2009 a gender pay equity study of the entire New Mexico state classified workforce (19,000+ employees) was completed.2 The results of the study were generally positive, with gender pay gaps lower than national averages, no apparent glass ceilings, and no evidence that job segregation led to gender wage

gaps. Specifically:

- Gender wage gaps were found in all state departments in this study, across the great majority of job titles and pay bands. Overall, the gender wage gaps favored women, in both number and size. In all departments, most gaps were in the very low to moderate range, with a few larger exceptions on both sides.

- At the time of the study, females nationally were earning 80.2 cents to the male dollar for full-time, year-round work, resulting in a gender wage gap of almost 20% favoring males.

Very few of the departments in the New Mexico state government had pay gaps as wide as the national averages in any pay band, and most had much smaller gaps. New Mexico has had the Hay Guide Chart Profile method of job evaluation in place for its for state employees for several years. Experts agree that gender wage gaps are expected to be smaller for public employers than for private employers, largely because of governments' use of systematic procedures such as the Hay System.

- Even though "glass ceilings" are a well-documented problem nationally, there were no apparent "glass ceilings" in the departments studied. This is a good indication that promotion practices as related to gender in the state workforce are likely to be fair and equitable.

- Job segregation (e.g. job titles that are totally or predominately held by one gender) is also a problem nationally, and New Mexico is no exception. However, the study indicated that the job segregation found in the state classified workforce does not lead to gender wage gaps, as it does in the nation as a whole. The state recognizes that gender segregation in jobs is a problem for diversity and should be addressed to produce a more balanced workforce.

A six-department pilot study was conducted to test methodology and procedures using gender pay gaps by job title as baseline data. This analysis proved inconclusive, due to job segregation between women and men in most departments, which resulted in many job titles with too few women or too few men for meaningful comparison.

Job titles were then collapsed across pay bands in each department, and this was also the method for the larger study of 19,000 employees. This methodology yielded much more meaningful data.

While the state recognized that race and ethnicity also substantially impact wage gaps, it was not possible to gather reliable data on race and ethnicity. This information is optional for employees, and some employee records went back as far as 25 years, when the only categories available were White and Hispanic. The state did, however, use the opportunity to update records on these factors, with the goal of expanding future wage gap studies to include them.

–  –  –

Governor Richardson issued a second Executive Order in 2009 to further the goal of eliminating

gender and wage pay gaps in the State of New Mexico. Provisions included:

- Appointment of a Working Group to construct a process for addressing problems identified in the study of state government departments, and requiring all cabinet departments to submit a gender pay gap report to the governor on an annual basis.

- Extending the requirement for studying and correcting any gender pay gaps and job segregation to entities holding contracts with the state government. The Working Group, consisting of cabinet secretaries or their designees from the General Services Department, State Personnel, State Purchasing, and the State Department of Workforce Solutions, with input from the private sector and other state boards and commissions, was charged with developing policies and procedures to accomplish that goal, with timelines for implementation, and appropriate safeguards for small business.

–  –  –

In designing the reporting system, the Working Group followed eight principles:

1. The system should be conceptualized as an incentive for contractors -- the opportunity to bid on state contracts -- not a punishment.

2. So far as possible, the system should use data already gathered by contractors or readily accessible to them.

3. So far as possible, the system should overlap with existing reporting requirements.

4. The system should minimize contractor concerns about release of proprietary information.

5. The system should be simple so that even small contractors could participate without undue administrative burdens.

6. Reporting should be mandatory and uniform across all departments.

7. The State should provide technical assistance to contractors requesting it.

8. The reports should be subject to audit by an entity independent of individuals or departments involving in contracting (i.e. the Office of the State Auditor).

Within this general framework, much discussion focused on the range of contractors that should be required to report. It was decided to apply the requirement to all firms with at least 10 employees. Setting a low threshold ensured coverage of a large number of state contractors, many of which are quite small. In addition, it ensured coverage of contractors -- such as law firms and accounting firms -- that might have sufficient employees for meaningful pay gap analyses because, although they have few total employees, those employees are concentrated in only one or two categories.

In addition to companies with fewer than 10 employees, several other categories of contract recipients are exempt from the reporting requirement: (1) government to government contracts;

(2) entities granted emergency procurement contracts; and (3) out of state contractors providing goods or services without employees working in the state.3 However, sole-source contractors are not exempt. Contractors that subcontract more than 10% of the value of the contract are also required to report data for subcontractors. In the case of procurements by purchase order, firms that accumulate $20,000 in a calendar year in combined purchase orders are also subject to the reporting requirement.


During the first five months of 2010, the Working Group developed policies, procedures, and data collection tools, which were published on the State Purchasing website in May of 2010 and implemented beginning July 1, 2010. As a phase-in, all entities with 10 or more employees contracting with the State of New Mexico were required to submit a gender pay equity report upon notice of receiving a contract award. These were submitted after the award process was completed, so were not part of the response to solicitations or request for proposal (RFP) process.

Beginning October 1, 2010, gender pay equity reports were required to be submitted as part of the response to solicitations or request for proposal (RFP) process. The Office of the State Auditor has the authority to audit reports.

In keeping with the second and third key principles listed earlier in this section, it was decided that EEO-1 job categories4 would be used for reporting. Many contractors and payroll processing firms are already familiar with these categories. Using them avoided the need for a new taxonomy and also avoided the difficulties of analyzing data for job titles or groupings not comparable across firms.

While many employers track race and ethnicity, not all do. Since the New Mexico initiative is ground-breaking and "keep it simple" is a watchword, it was decided initially to require only gender data. Recognizing that race and ethnicity are also major concerns, reporting should be extended to race and ethnic minorities in the future.

For similar reasons, employers are not required to report information on a range of worker characteristics -- such as education, experience, or job tenure -- that are likely to explain some part of reported wage gaps. Such data are often not routinely tracked by employers or not kept in Employers with workers in the state are required to report for those employees performing duties within state borders regardless of the origin of paychecks or the residency of the workers.

Contractors are provided with direct links to U.S. DOL for purposes of determining job categories for their workers.

a format that lends itself to easy reporting or analysis. The New Mexico system envisions these factors as more properly part of deeper investigations of wage disparities at individual contractors, rather than reporting requirements universal to all contractors.

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