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- Main article: Equity (payment)
It is most commonly used in a context of sexual discrimination, as equal pay for women. Equal Pay does not simply relate to basic salary but also to the full range of benefits, non salary payments, bonuses and allowances that are paid.
Equal pay for equal work is difficult or impossible to implement in a free society. Government controlled wages can be attributed to most of the success in this area.
One reasons that men get paid more than women may be salary negotiation. Men are four times more likely than women to negotiate a higher salary, amounting to approximately $500,000 USD in lost revenue by age 60 for the average women. In addition, when women do negotiate their salaries, they are more pessimistic and negotiate an average of 30% less than men.
Another reason for pay discrimination could be because women are far more likely to take time off work to raise children. This unreliability factor might lower the overall perception of the value of a woman's time.
Free market supporters believe that government actions to correct gender pay disparity serve to interfere with the system of voluntary exchange. They see the fundamental issue is that the employer is the owner of the job, not the government or the employee. The employer negotiates the job and pays according to performance, not according to job duties. A private business would not want to lose its best performers by compensating them less and can ill afford paying its lower performers higher because the overall productivity will decline.
There are also specific affirmative defenses to the criticism above that government is forcing employers to pay less qualified workers the same as superior workers. The EPA’s four affirmative defenses allows unequal pay for equal work when the wages are set "pursuant to (i) a seniority system; (ii) a merit system; (iii) a system which measures earnings by quantity or quality of production; or (iv) ... any other factor other than sex[.]" If an employer can prove that a pay differential exists because of one of these factors, there is no liability.
Equal pay has also been criticized as focusing too much on women. The pay gap between ethnic minorities (Black and Asian) and white workers is often much higher than that of women and men, this is particularly true in the UK.
Ouchi Shinya, a professor of law at Kobe University in Japan wrote in his blog, "Equal pay for equal work is a dubious notion because there is no legal reason to adopt it, and there is no reality to adopt it in Japan."
Chairman Mao Zedong (1955): "Men and women must receive equal pay for equal work in production."
The U.S. Democratic Party (2008): "When women still earn 76 cents for every dollar that a man earns, it doesn’t just hurt women; it hurts families and children. We will pass the 'Lilly Ledbetter' Act, which will make it easier to combat pay discrimination; we will pass the Fair Pay Act; and we will modernize the Equal Pay Act." (The 2008 Democratic Party Platform, p. 17) See: Lilly Ledbetter Fair Pay Act
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