The price of talent: new California law seeks to address gender pay gap

“I knew I was being paid less and I still agreed to do American Hustle because the option comes down to do it, or don’t do it. So you just have to decide if it’s worth it for you. It doesn’t mean I liked it.” — Amy Adams

From January 2018, employers in California will be prohibited from asking job applicants about their previous pay.  Guidance for the new Labor Code 432.3 states “closing the wage gap starts with barring employers from asking questions about salary history, so that previous salary discrimination is not perpetuated.” If asked to do so, employers must also provide the “pay scale” for the position being filled. The Code does not prohibit applicants from volunteering their salary history, nor does it prohibit an employer from using that information to determine their offer.

How does this compare with equal pay laws in England? Before the Equal Pay Act 1970 and Sex Discrimination Act 1975, businesses did not hide the fact that men and women who performed the same job could be paid different wages, or that certain lower-paid jobs were explicitly reserved for women. The current legislation, the Equality Act 2010, states that men and women should receive equal pay for equal work, as prescribed by Article 157 of the Treaty on the Functioning of the European Union.

Under the Gender Pay Gap Regulations 2017, large private employers must also publish a pay gap report each year. These reports contain the overall salary figures for employees, information on bonuses, and the proportion of men and women at different levels of seniority within the organisation.

Although English law does not prohibit employers from asking about salary history, such questions are often perceived as invasive. Generally speaking, employers are more likely to ask a prospective applicant about their “salary expectations” for a particular role.

american-hustle-cast
the lead cast of American Hustle

How might the Code impact the entertainment industry? The 2014 Sony Pictures email hack notoriously revealed that the female film stars of American Hustle were paid less than their male counterparts. Jennifer Lawrence wrote a widely-circulated essay, “Why Do I Make Less Than My Male Co‑Stars?” She was joined by Emilia Clarke, Natalie Portman, Emma Stone, and many others (both women and men) in publicly condemning pay disparity in the entertainment industry. Forbes recently reported that 14 Hollywood actors earn more than the highest paid actress, Emma Stone. And only three actresses – Emma Stone, Jennifer Aniston, and Jennifer Lawrence – feature in the top 20 highest paid Hollywood stars list.

It would be easy to dismiss the Hollywood pay gap issue as trivial, because a famous entertainer’s salary can be so much higher than those of ordinary people. But earnings in Tinseltown can actually provide vivid insight into the wider gender inequality issue.

Occupational segregation, where women and men find themselves at different jobs or at different levels of the same job, is a key factor in the gender wage gap. Far more women than men find employment in the “C” sectors: care, catering, cashiering, cleaning and clerical work. Women are also more likely to take career breaks related to starting and raising families.

Acting, on the other hand, is one of very few careers which for centuries has been open for women to pursue. Acting requires the same skills in the same environments regardless of gender, and both men and women have received the profession’s highest accolades. Despite this, women actors still earn less than men.

When a film or television project is put into development, the studio’s business affairs department will first request salary quotes from the actor’s agent. This informs the studio as to the actor’s relative bargaining position when negotiating compensation. When actors divulge their salary history, studios may be tempted to perpetuate any earlier inequities, and offer a lower pay package. The new law should therefore benefit emerging or underpaid talent in particular.

It is important to remember however that Hollywood’s gender pay gap is a result of multiple problems that cannot be solved by salary disclosure rules alone. Women comprise less than 30% of all speaking parts in movies, and only 25% of roles for characters over the age of 40.  So while the new labor Code is a step in the right direction, paycheques will continue to be wildly unequal unless women are given more opportunities to act in a greater number of roles.

 

I’ve written previously about labour laws and the entertainment industry in New Zealand.

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