GENDER EQUITY AGAINST “ECONOMIC REALITIES”: HOW A CONFLICT BETWEEN TWO MOVEMENTS RESHAPED THE CULTURAL UNDERSTANDING OF PAY

Abstract

In the United States today, there is a broad cultural understanding that market forces drive pay outcomes. But prior to the 1980s, pay was understood to be the product of bureaucratic processes internal to organizations. The question of whether pay is determined by the market or organizational decisions is essential for evaluating employers’ liability for gender pay inequality, as employers are not responsible for inequalities resulting from the “economic realities” of the labor market. This article locates the shift in cultural beliefs about pay in key court decisions in the 1970s and 1980s. At that time, a social movement for pay equity used the idea of comparable worth to hold organizations accountable for inequality between jobs held by women and similarly valuable jobs held by men. But the judges who ruled on these cases were informed by a different movement, known as law and economics, which led them to conceptualize pay as the product of market forces instead of organizational decisions. These judges’ decisions limited employers’ liability for the pay gap and precipitated a transformation of the cultural common sense of pay within organizations, which increasingly adopted market-based approaches. The case of comparable worth highlights the role of judges, who have a unique role in determining the impact of social movements while themselves being targeted by such movements.