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Opinion: To argue against Colorado’s new Equal Pay Act is to argue against market transparency

And if more transparency means higher wages, then yes, please.

There’s been a lot of hoopla over the past few weeks about news that a few large national employers advertised to prospective employees that they could work from home, anywhere in the country, except in Colorado. These companies are refusing to comply with Colorado law requiring employers to include salary ranges in job postings, a transparency measure enacted as part of Colorado’s Equal Pay Act to ensure pay equity in the workplace between men and women. 

Some loud conservative voices in Colorado have suggested that these large corporations’ refusal to comply with basic transparency rules is an example of the so-called “unintended consequences” of progressive reforms to improve labor standards in our state. They want this news to serve as a warning to policymakers in Colorado and beyond that regulation is bad and that they shouldn’t impede employers from doing business the way they want to. 

David Seligman

It’s not an “unintended consequence” of this reform that a small minority of companies have decided to flout the law — it’s just a few bad actors refusing to play by the rules of simple market transparency. Thankfully, the Polis Administration has begun to work with those companies to bring them into compliance with Colorado law as soon as possible. 

The pay transparency requirement in the Equal Pay Act not only implements a critical tool in the fight for gender and pay equity. It also helps to rebalance the labor market to provide more dignity, power, and autonomy to workers. For those who purport to be concerned with preserving individual liberty, rules that check burgeoning private, corporate power should be welcome. It should be the large corporations refusing to play by the rules, not Colorado’s pay transparency statute, that should be the subject of derision from Colorado’s conservatives.  

Opponents of labor reforms in our state often argue that regulation isn’t consistent with what they see as the Colorado way of doing business. We value individual autonomy and power for people, they say, not an all-powerful state government. The problem is that for decades, while some policymakers purported to guard our autonomy and liberty from the government, they lost track of the threat to those values posed by large corporate actors.

During this time, wages have stagnated and worker autonomy and bargaining power has been depleted. Workers are subject to workplace surveillance, deceptive practices, non-compete, no-hire, and no-poach agreements that restrain their ability to work for other employers, misclassification that limits access to public benefits and drains public coffers, wage theft, workplace health and safety threats, discrimination, and much more. None of that makes us more free. 

Employers know what they’re paying their workers, and through the use of third-party human-resources firms many even know what their competitors are paying. Often they can engage in that secret sharing of wage information without being subject to antitrust scrutiny — though this is something that a recent executive order from the Biden Administration recommends changing.

Meanwhile, workers rarely have access to this kind of information. They apply for jobs without knowing for sure what companies may pay them or similarly situated workers, and many workers are even subject to harsh and illegal policies that prevent them from sharing wage information while on the job. 

This imbalance of information is an imbalance of power. It allows corporations to keep wages low and it disproportionately hurts women and people of color, who often suffer from hidden pay inequities that result in higher wages for white and male colleagues. 

It’d be pretty hard for the purported pro-liberty conservative right to argue that marketplace transparency is a bad thing. Competitive markets depend on transparency, after all. Imagine pulling up to a gas station and being told that you have to insert your card in the machine to see how much it would cost per gallon. If that were the case, it would be much easier for gas stations to extract higher prices from consumers. 

But some opponents of Colorado’s wage transparency law can’t resist saying the quiet part out loud. One opponent recently argued, in a failed, recently dismissed lawsuit litigated by employer-side law firm Littler Mendelson, that forcing Colorado employers to post wage information would allow competitors to pay higher wages to “pick off” workers. If Colorado’s pay requirement places pressure on employers to compete to raise wages to pay workers closer to what they’re worth, sign us all up.  

TODAY’S UNDERWRITER

Opponents warn that Colorado will be put at a competitive disadvantage relative to other states if we start giving our workers the bargaining power that comes with knowing the salary range before they apply for a job. The unstated premise is that corporations won’t want to come here if they can’t continue to undermine worker power as they have for decades. 

The premise is false. We shouldn’t be competing with other states by making sure all bottom feeders are welcome to come to play here, or by rewarding employers whose business model is keeping pay secret from their workers so they can cheap out on those they see as vulnerable enough to accept less than their peers.

We should be competing through a labor market where workers have power and voice. Where workers can join a union. Where discrimination is called out. Where workers can choose and move between jobs for better pay and higher benefits. Where our policymakers endeavor to give workers the tools to exercise autonomy and power in the face of powerful corporate interests. Governor Polis and the General Assembly know that’s the Colorado way. Others should be following our lead.


David Seligman, of Denver, is executive director of Towards Justice.



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