Status (overview) of bill: https://olis.leg.state.or.us/liz/2017R1/Measures/Overview/HB2005
Adds unlawful employment practices for payment of wages based on applicant history or protected class. Requires employer to demonstrate business necessity for pay differentials that are not based on merit, seniority, piece-rate or production-based work. Modifies violations and adds remedies.
Personal Choice and Responsibility
Normally employers try to hire individuals where what they can afford to pay is at least equal to the applicant’s prior earnings, or the current value of the applicant’s skills in the broader employment market. They want new employees to be happy with the compensation and stay with the company. It is at that point that the prospective employee makes a decision if this is where they want to work with full information on the table from both sides.
Fiscal Responsibility
Makes continued unlawful pay practices a violation for each pay check issued. The bill actually significantly disrupts the economic efficiency of the labor market and the economy by further disrupting the hiring of appropriate workers and increasing the potential non-value-added cost of hiring any employee.
Limited Government
There are already strong protections in existing statutes, and there is no evidence of significant intentional discrimination. The majority of testimony was against discrimination of women and a few minorities, which is already prohibited by law. The “Labor Market” is a very complex market place of supply and demand for employment. For a market to function efficiently it must have good transparency of information for decision making both by employers and employees. Other provisions of the bill simply increase an employer’s cost potential for legal action and administrative penalties, even when they have acted fairly and lawfully. Section 2 (2) (d) requires that employers prove that any employment of compensation decision was NOT based on prohibited factors or even “perceptions”. It's the same as guilty until you prove yourself innocent. It is very hard to prove a negative, or that you haven’t done something.
Free Markets
This bill flies in the face of a free market and attempts to further control how private businesses operate. An employer’s ability to pay an employee is limited by the value that the employees services adds to the businesses’ product and the impact of the cost of those services on the elasticity of demand for the businesses’ product or service. Normally employers try to hire individuals where what they can afford to pay is at least equal to the applicant’s prior earnings, or the current value of the applicant’s skills in the broader employment market. They want new employees to be happy with the compensation and stay with the company.
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