WASHINGTON – This morning, U.S. Senator Deb Fischer (R-Neb.) delivered remarks at the American Enterprise Institute (AEI) regarding her legislation to update our federal laws on equal pay and paid family leave.
Senator Fischer is the author of two bills to address issues facing working families. The first, known as the Workplace Advancement Act, strengthens existing equal pay law by offering legal protections for employees seeking wage information. Her second initiative, the bipartisan Strong Families Act, was introduced with Senator Angus King (I-Maine) and offers incentives to employers who provide paid leave.
Following her remarks, Senator Fischer participated in a question-and-answer session moderated by AEI scholar Aparna Mathur. To conclude the event, expert panelists provided their opinions on the issues of equal pay and paid leave. The panel included Heather Boushey of the Washington Center for Equitable Growth, Douglas Holtz-Eakin of the American Action Forum, and Isabel Sawhill of the Brookings Institution.
Below is the full transcript of Senator Fischer’s remarks at AEI:
Thank you Aparna for that warm introduction and thank you all for having me here today.
I’m excited to be here at AEI, an important institution that not only protects free enterprise, but also fosters thoughtful debate and the sharing of ideas on the challenges we face as a nation.
I’m here today to talk about two important issues affecting American families.
In Nebraska and all across the country, people are worried.
Whether it’s hardworking parents trying to make ends meet or grandparents concerned about the future we will leave our grandchildren, there’s no shortage of anxiety.
I am a firm believer in conservative principles and limited government.
I also think Congress has a duty to promote policies that will make life easier and more flexible for American families.
For the mother or father who works full-time while raising her three children, life has no shortage of demands and obligations.
It’s time to discover how we can empower America’s families with the tools they need to prosper
Today, I will discuss two areas where I believe productive solutions and common ground are possible.
Barriers still remain, whether real or perceived, which are halting this progress and limiting prosperity for the American worker, particularly women.
Women across the United States have a positive story to tell.
We now hold more than half of all professional and managerial jobs, double the number since 1980.
We earn over 55 percent of bachelor’s degrees, run nearly 10 million small businesses, and serve in Congress at record levels.
We have come a long way, but our work has just begun.
Equal pay for equal work is a shared American value.
At its core, equal pay is about basic fairness and ensuring that every woman – just like every man – has the opportunity to build the life she chooses.
Republicans fully agree that pay discrimination is wrong.
We fully support existing law.
For over half a century, the Equal Pay Act and the Civil Rights Act have enabled women to make significant economic strides.
As such, any violations of these important laws are illegal and should be punished to the full extent of the law.
But I believe we can also go further.
Congress has an opportunity to recommit itself to this issue and ensure these existing laws are vigorously enforced.
Our country is stronger today because women have advanced in the workplace.
There are stories of young women who start off in entry-level jobs and rise to the top of the corporate ranks because someone, somewhere recognized her potential.
There are managers and mentors committed to their team.
Men and women across the workforce are focused on cultivating strengths and providing thoughtful feedback in areas that need improvement.
Unfortunately, there are also stories of pain, discrimination, and bias.
We all have friends and neighbors, sisters and mothers, who were treated unfairly at some point in their careers.
Silence, however, does not foster progress.
I want to help every woman and every man put a stop to unfair pay practices.
This starts by breaking the barriers to open discussion.
Few realize the extent of this problem.
In 2003, the University of Pennsylvania conducted a study on how salaries are discussed in the private sector.
The survey found over one-third of private-sector employers have specific rules prohibiting employees from discussing their pay with coworkers.
Additionally, the data “suggest[s] that a significant number of employers have either a preference for, or have actually instituted, specific pay secrecy/confidentiality rules.”
This was reinforced by another survey from the Institute for Women’s Policy Research. Roughly half of workers reported that discussing wages and salaries is either “discouraged or prohibited, and/or could lead to punishment.”
It went on to note that “pay secrecy appears to contribute to the gender gap in earnings.”
These studies point to a common problem, one that is not only preventing progress, but also fueling anger, resentment, and fear.
The American workforce is lacking protections for employees to engage in open dialogue about their salaries.
To put it bluntly: Americans are afraid to ask how their salary compares to their colleagues.
Meanwhile, current law does not adequately protect workers against retaliation from employers who want to prevent conversations about compensation.
Because of this, there exists an unnecessary gap between workers who believe their compensation is biased and unfair and employers who have good reason to dread the government mandating how to run their businesses.
It doesn’t have to be this way. We don’t have to choose between two extremes.
As the saying goes: sunlight is the best disinfectant.
If you want to know how your salary compares to your colleagues, you should have every right to ask.
It’s as basic as the First Amendment.
Ensuring transparency would not only make it easier for workers to recognize pay discrimination, it would also empower them to negotiate their salaries effectively.
Wage transparency is not a new initiative.
It already enjoys support on both sides of the political spectrum. In fact, both President Obama and Hillary Clinton are in favor of it.
Not all transparency is created equal however.
Earlier this year, the Obama administration proposed a new regulation targeting businesses with over 100 employees.
Through this rule, the Labor Department would require businesses to submit large amounts of data regarding race, gender, and other statistics to the Equal Employment Opportunity Commission (EEOC).
The administration believes this will effectively route-out discrimination.
I believe this is just another government mandate that intrudes into the operations of a private business.
We can’t discount the burden this will put on employers.
With every new regulation, there is a cost.
Government should never be in the business of data-mining private entities for their own political goals.
I also have real doubts that this raw data will give the administration what it is looking for.
Instead, it risks presenting a distorted picture of pay data.
Moreover, it remains unclear how this information would identify discrimination.
The data does not take into account other factors — including years of experience, education level, and productivity — that are appropriately used to determine wages.
Looking at big data alone fails to tell the full story.
I am concerned that the rigid compensation structures resulting from this proposal could force businesses to provide employees with less flexibility and deal a greater blow to women.
Instead, we should be empowering both employers and employees to negotiate flexible work arrangements to best meet their individual needs.
I agree that we have more work to do on equal pay.
The way to make meaningful and lasting progress isn’t through misguided executive actions that could hurt women.
To make a difference in the lives of working families, we must focus on building bipartisan consensus.
I have been working hard to do just that by collaborating with my colleagues and generating support for my bill, known as the Workplace Advancement Act.
I believe that every American worker should have the ability to discuss compensation without fear of retribution.
This legislation breaks down the barriers to open dialogue, allowing employees to ask questions and gain information.
Access to this information could enable workers to be their own best advocates and negotiate for the salaries they feel they deserve.
Knowledge is power.
By freely discussing their wages, workers can negotiate effectively for the pay they want.
My proposal has received the support of almost every Senate Republican and five Democrats.
But as we know all too well, in Washington, anything that receives bipartisan support stalls with five words: “it doesn’t go far enough.”
The biggest critics of this plan suggest it is too modest.
They claim that transparency is only the first step, and the second requires mandates.
The truth is, meaningful change cannot happen without action and compromise.
By its very definition, it requires both agreement and accommodation.
This bill can make a real difference for American workers and unlike legislation offered by Democrats, it can actually pass.
Others would argue this change is unnecessary because the right to discuss salaries is protected under existing law.
While it is true that certain employees and certain conversations are protected, there is no reason why we can’t apply the same freedom to all Americans.
As I discussed previously, surveys suggest over one-third of private sector companies have specific prohibitions in place.
I’m encouraged by the support we have already garnered on both sides of the aisle.
This needed, straightforward change to our equal pay laws is achievable.
The purpose of our legislative process is to find solutions that both Republicans and Democrats can achieve for the American people.
An “all or nothing” attitude only prevents progress and leaves us with the false choices and stereotypes that have persisted for decades.
We now have a real opportunity to make a difference for both men and women who work hard, every day, to provide for their families.
Above all, we can help them succeed and prosper in the workforce while being secure in the knowledge they are compensated fairly for their work.
Meanwhile, the needs of the American workforce are changing.
From young parents spending time with newborns to adults caring for aging parents, life can be stressful with more demands and less time.
Employers are caught in the middle of this reality as they seek to run profitable businesses while respecting the family needs of their employees.
The debate over how to address this problem has occurred in cities and states throughout our country for decades.
Recently, the issue came to the forefront here in Washington, D.C.
The city council is considering a new policy that would give workers up to 16 weeks of paid time off to care for a newborn child or elderly family member.
According to a survey last fall by the Washington Post, 82 percent of district residents support employers footing the bill for paid leave, but less than 45 percent would support it if workers were required to pay.
In other words, everyone loves the principle of paid leave but no one wants to pay for it.
Providing leave for workers to care for young children or ailing loved ones is not a new idea.
In fact, for large employers, it’s already the law.
The challenge for many working families, particularly hourly workers living paycheck to paycheck, is that current law does not address paid time off.
The conversation about paid leave has shifted as the makeup of the workforce has shifted.
Today, mothers serve as the primary breadwinners in 40 percent of all households.
Businesses are starting to recognize this reality and change their policies accordingly.
For example, companies in Silicon Valley are offering generous paid time off for new parents.
These innovative companies understand that offering more flexible options to meet family obligations will help them attract and retain talented employees.
Our aging population also means many more American workers are faced with increased family responsibilities.
According to Pew Research, there are 40.4 million unpaid caregivers for adults 65 and older in the United States.
They work full-time jobs, but are also full-time caregivers to their aging and ailing parents.
These families would never call it a burden, but it is an exhausting job that requires a great deal of time and energy.
For those fortunate to work for employers who offer paid leave, achieving a work-life balance is easier.
But, the vast majority of Americans face no-win situations, forced to choose between their families and career obligations.
Working Americans want flexibility to meet family demands and employers want certainty to meet their bottom line.
I believe it is possible to find a middle ground on this issue, one that respects both families and employers – and moves our nation forward.
Last November, I joined Senator Angus King of Maine to reintroduce a bill that encourages employers to voluntarily offer paid leave to their employees.
Our bipartisan proposal, known as The Strong Families Act, offers a way forward through addressing the dilemma facing working Americans without punishing businesses.
It does so by offering incentives to businesses that voluntarily provide paid leave for their employees in the form of tax credits.
The 25 percent non-refundable tax credit in our bill is intended to incentivize employers who would otherwise be unable to offer any paid leave at all to any employees.
We can’t forget that when employees take time off, whether for health or other reasons, there is a cost to the employer and to the employees who must step-in and step-up to fill a new role.
By softening the financial blow for employers, particularly smaller employers who really struggle with this dilemma, we can help lower-wage or non-salaried employees receive paid time off.
Notably, this bill would not create a mandate from the federal government.
As a result, some reject the idea because, as we’ve heard before, they believe it does not go far enough.
But there are real costs associated with mandating paid leave.
The American Action Forum and Douglas Holtz-Eakin, who is here today as one of our esteemed panelists, have done some great work calculating the cost of a mandate.
They found that the FAMILY Act, a proposal from my friends on the other side of the aisle, mandates 12 weeks of paid family leave and would cost anywhere from $160 billion to $997 billion.
Proponents of this legislation point out that the payroll tax for the creation of this new program would be very small, amounting to a maximum employee contribution of roughly $4 per week.
That is true, but just like every new benefit proposed by the government, nothing is free.
According to the American Action Forum, the legislation’s payroll tax would only raise $30.6 billion, meaning this tax would only cover between 3.1 to 19.2 percent of the projected costs.
Ultimately, the FAMILY Act would create a giant new entitlement program that can’t cover its costs.
Instead, we need to find creative ways to incentivize businesses to provide these benefits to the workers who need them.
It’s time to have a constructive discussion about how we can make paid leave possible for more American families.
The Independent Women’s Forum recently conducted a study on what really matters to women when choosing a job.
They found flexibility to be a common theme.
Whether providing flexible schedules or offering alternatives like telecommuting, women valued flexibility at about the same level as receiving 10 paid vacation and sick days or receiving $5,000 to $10,000 in extra income.
The survey shows what many of us already know.
Every situation is different, and by providing more options, workers can determine how each can suit their own particular needs.
Rigid mandates can actually hurt their ability to negotiate unique arrangements with employers.
It also shows that while the demographics of the American workforce are changing, so are the needs and desires of American workers.
Rather than pushing for a permanent change to the tax code, Senator King and I are proposing a responsibly paid-for pilot program to gain accurate information and use it to form a permanent solution.
It is our hope, and our belief, that this tax credit can make a real difference in creating more opportunities for paid leave across the country.
No one should live with the fear that welcoming a new baby or taking an elderly parent to the doctor could mean losing a job.
This reasonable legislation can make a meaningful difference in the lives of American families, particularly those with already limited opportunities.
Whether it’s equal pay or paid leave, the issues that matter to American workers are evolving.
This progress demands solutions.
I believe we can achieve meaningful change that will allow both employees and businesses to grow our economy.
And we can do it without punishing mandates or picking winners and losers.
We owe it to the American people to discover shared solutions that can lead to stronger families and communities.
By working together, I’m confident we will not only succeed, but thrive as a nation.
Thank you again for having me here and allowing me to share these ideas with you today.
I look forward to your questions.