Last week, a judge at the National Labor Relations Board ruled that T-Mobile was guilty of violating national labor laws. One of the ways it violated the law, through its employee policies, was prohibiting employees from talking about wages with each other. That was found to violate the National Labor Relations Act (NLRA), which protects employees’ right to discuss wages and working conditions with each other as part of collective bargaining efforts.
Yet many Americans currently work in places that ban or discourage them from talking about their pay with their coworkers. A 2010 survey from the Institute for Women’s Policy Research (IWPR) found that about half of all employees say that discussing wages and salaries is either discouraged, outright prohibited, or could lead to punishment.
This is a big reason why the gender pay gap persists, experts say. If women are prohibited from asking their coworkers what they make, then it will be hard for them to find out if they’re being unfairly discriminated against. This was the case for Lilly Ledbetter, for whom the Lilly Ledbetter Fair Pay Act was named. She didn’t find out she was paid less than her male colleagues for 19 years. In workplaces that are more transparent about pay scales, the gender wage gap is significantly smaller and shrinking steadily.
So how can it be that so many workers labor under such conditions if those conditions are against labor law?
One reason may be that employees aren’t motivated to challenge salary secrecy policies and employers have little incentive to change them. “It’s not a high-risk violation in the sense that the consequences are quite limited,” Cynthia Estlund, a professor at New York University School of Law, said. Meanwhile, unless an employee was disciplined for violating a policy and can therefore expect job reinstatement or backpay, she will “get nothing out of it except finding the employer violated the law.”
The labor protections also don’t cover everyone. The NLRA doesn’t apply to supervisors, so they wouldn’t benefit from its protections. “For example, Lilly Ledbetter was a supervisor, so she couldn’t have brought a claim under the NLRA,” pointed out Fatima Goss Graves, vice president for education and employment at the National Women’s Law Center (NWLC).
Most Americans may also just be unaware of their rights. “Laws are good, but you need to know about them and you need to know what you can do to claim your rights, and a lot of people don’t,” said Ariane Hegewisch, study director at IWPR. “Pay secrecy is no exception.”
And while the NLRA’s rules may be “straight forward,” as Estlund put it, it may not be clear that it covers this kind of issue. “It doesn’t say ‘pay secrecy’ or that retaliating against workers around pay secrecy is illegal,” Hegewisch said. “It’s indirectly about saying workers are allowed to get together to bargain for their wages, and if you do that obviously you need to share salaries. It’s kind of an indirect way of providing the right.”
That could mean that even an employee who is aware of the protections wouldn’t realize they apply to a company policy against discussing pay. “It may be that people typically think about their rights under the NLRA in the context of bargaining and aren’t tying it together with what may not be a bargaining issue, but may be a good old fashioned pay discrimination issue,” Graves said.
That’s not to say that cases like the one against T-Mobile never happen. The NWLC cites at least six other successful cases against employers who banned pay discussions. And according to Estlund, they very often succeed.
Yet all three say clearer and broader legislation is needed to truly stamp out salary secrecy. There are different ways legislators have sought to do just that. The Paycheck Fairness Act, which is set to be re-introduced this week, would ban the practice of salary secrecy, among other things, although Republicans have continuously shot it down. Some states have considered instituting their own bans. And President Obama issued an executive order last year banning federal contractors from having salary secrecy policies.
“A blanket and explicit ban is important,” Graves argued. “That’ll make it very, very clear that these sorts of policies are not permitted.” For one, a ban could protect the supervisors who are currently left out of the NLRA’s protections and also signal to workers who aren’t part of a union — nearly 90 percent of the workforce — that they are also protected when talking about pay even if they’re not collectively bargaining. It could beef up the ramifications for employers who break the law and better reward employees who bring charges.
Hegewisch also says it’s important to bring the protections into the fight to close the gender wage gap. It’s a way to “make it clear that this is part of equal pay… to do it as part of the equal pay legislation and not indirectly as part of pay negotiations,” she said.