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9 The Impact of Pay Equity on Public Employees. State of Minnesota Employees' Attitudes Towarcl Wage Policy Innovation SARA M. EVANS and BARBARA J. NELSON The origins of any social reform are woven into the fabric of the society in which it occurs. The dates when reform becomes widely visible reflect the points at which problem recognition and concerted re- sponse coalesce. This coming together oc- curred in the comparable worth movement during the early 1970s, when the members of the American Federation of State, County and Municipal Employees (AFSCME) be- gan to work for equal pay for work of com- parable value for employees of the state of Washington.i Their efforts and the strike of municipal workers in San Jose, California, encouraged the Minnesota AFSCME and the Minnesota Council on the Economic Status of Women to propose legislation re- iMany states and localities (including the state of Minnesota and its local jurisdictions) call their com- parable worth policies "pay equity, " a term that conveys the goal rather than the process. Many advocates now prefer to define pay equity as "the goal of eliminating wage discrimination" (American Association of Uni- versity Women, 19873. In this paper we use comparable worth and pay equity interchangeably to mean equal pay for work of equal value (Nelson, 1985; Treiman and Hartmann, 1981). A formal definition is provided later in this section. 200 quiring pay equity (as it is called in Min- nesota) as the principle for remuneration of state employees. The State Employees Pay Equity Act was passed in 1982 an(1 imple- mented over 4 years beginning in 1983. Minnesota thus became the first state to have completely implemente(1 a pay equity wage policy. Minnesota's fully implemente(l pay eq- uity policy offers an important opportunity for examining the consequences for em- ployees of adopting this wage policy. Most discussions of pay equity have been abstract, theoretical, and focused on macroeconomic issues. The labor relations issues associated with pay equity have been the object of some speculation, but little systematic in- formation has been available with which to ascertain the accuracy of those views, in part because so few workplaces have adopt- ed the policy. Advocates suggest that pay equity will contribute to employee self- esteem, encourage job satisfaction, and re- uce friction in the workplace (Gold, 1983; Grune, 1984~. Opponents suggest that pay equity will disrupt the workplace with jeal- ousy an(l decrease the job satisfaction of women workers by encouraging men (through
IMPACT OF PAY EQUITY ON PUBLIC EMPLOYEES higher wages) to enter traditionally female occupations (Cowley, 1984; Gold, 1983; O'Neill, 1984; Seligman, 1984~. None of these assertions has been researched. As part of a larger study of the initiation and implementation of pay equity in several states and localities, the University of Min- nesota's Comparable Worth Research Proj- ect undertook a survey of state of Minnesota employees to determine employee re- sponses to pay equity. The survey charted new ground, making available the first in- formation about employee reactions to this salary innovation. The research reported here focuses on three sets of questions cle- rived from the survey data: support and kno~viedge questions (Who supported the concept of pay equity? Who had heard of the policy? How detailed was the knowI- eclge?~; experience questions (Who reporte and who actually received pay equity raises?; and impact questions (What Tong-term con- sequences die] employees see arising from the adoption of pay equity? How (lid pay equity affect job satisfactions. To answer these questions, this paper presents a brief history of the Minnesota pay equity policy; a discussion of the consequences of wage changes on labor relations; a presentation of data, methods, and findings; and inter- pretations drawn from the survey and from interviews with policy makers in Minnesota. POLICY HISTORY Employees' responses to the implemen- tation of pay equity are best understoocl in the context of the history of this policy in Minnesota, the specific content of the law, ant] the process of its negotiation and im- plementation. The contemporary history of pay equity in Minnesota was initiated in the 1970s by two groups Council 6, AFSCME's local for state of Minnesota em- ployees, and the Council on the Economic Status of Women. Council 6 negotiated a job evaluation study in 1974 because of the relatively low wages of clerical workers com- 201 pared with janitors. Although the study was never funcled, it constituted the first move- ment for pay equity. In 1976, the Council on the Economic Status of Women was established by the legislature. By 1981 the council had doc- umented that women in state employment earned 73.8 percent of what men in state employment earned, and the average man entering state service began at a salary higher than the salary of the average woman worker with 20 years of experience in state employment (Council on the Economic Sta- tus of Women, 1982:17; Rothchild, 1985~. The pay equity initiative grew out of these anomalies and the fact that the Equal Pay Act and Title VII of the Civil Rights Act would] never address these structural sources of wage (differences (interview with Linda Berglin, 1987~. Content In 1982, the State Employees Pay Equity Act was passed with the strong support of AFSCME and the Council on the Economic Status of Women (Evans and Nelson, 1986~.2 The law declared that it was the state's policy "to establish equitable compensation relationships between female-dominated, male-dominated, and balanced classes of employees in the executive branch." The legislation specified that pay equity raises were to be appropriated separately from general salary increments. The first portion of the money for pay equity raises was appropriated the next year. Within the limits of the special appro- priation for pay equity, the cloliar amount of the raises going to each eligible job cias- sification was negotiate(l through collective bargaining immecliately following regular 2The Minnesota Council on the Economic Status of Women became the Commission on the Economic Status of Women in 1983. Originally, it was a joint legislative-public body. Currently, it comprises only members of the legislature.
202 contract negotiations. Full implementation over 4 years required appropriations from two biennial legislative sessions and two rounds of negotiation. Pay equity adde $21.7 million to the personnel costs of the state, which totaled 3. 7 percent of the wage bill (Commission on the Economic Status of Women, 1985~.3 The wage policy established by the State Employees Pay Equity Act conforme(1 more closely to the theory of equal pay for jobs of equal value than did the policy of any other jurisdiction that has implemented pay equity. Define(1 formally, equal pay for jobs of equal value is a wage policy requiring equal pay within a jurisdiction or firm for job classifications that are valuer] equally in terms of skill, effort, responsibility, an working conditions. In practice, imple- menting this policy requires the application of a single job evaluation system to all job classifications within the jurisdiction or firm. This single job evaluation system measures in cletai! the skill, effort, responsibility, and working conditions of every job classification and combines the scores in each area to produce a single, overall score for every classification. lob classifications with equal overall scores are consiclered to have equal value to the jurisdiction or firm. Under a pay equity wage policy, classifications of equal value are paid equivalently iNelson, 19854. Pay equity is more than pay for points, however. The principle guiding pay equity is that jobs held primarily by women or minorities are paid less than jobs held pri- marily by men or whites in part because the incumbents of the jobs are women or minorities (Feldberg, 1984; Treiman and Hartmann, 1981~. Using this reasoning, the sin 1984, the legislature passed a second, slightly different pay equity statute requiring all cities, coun- ties, school boards, and other public employers to use a pay equity standard when setting wages. So far, localities have paid for the implementation of pay equity without assistance from the state. The survey does not include employees of local jurisdictions. PAY EQUllrY: EMPIRICAL INQUIRIES jobs held primarily by men or whites receive wages that do not reflect this legacy of lowered wages due to the clevaluation of the incumbents of the jobs. Under a pay equity policy, male or white wage practices become the norm for setting wages in jobs held pre(lominantly by women or minori- ties. 4 Implementation Implementation of the Minnesota law was base(1 on an existing point factor job eval- uation system for state employees ant] an existing technical pay equity analysis of that system. In 1979, Hay Associates (now Hay Group), a consulting firm, completed an examination of the state's personnel policies an(1 practices. An analysis of the Hay As- sociates job evaluation data by the Council on the Economic Status of Women showed that at the same point value, female-dom- inate(1 jobs always paid less than the average for male-clominate(l jobs.5 The male wage line was then used in implementing com- parable worth. The Minnesota Department of Employee Relations compared the wages of predom- inantly male ant] female jobs at equivalent point values (see Figure 9-1). If the female job paid less, the wage rate for the female occupation was a(ljuste(1 upward to the wage rate of the male occupation. The state (lid not alter the pay of balance:! classes below the male wage line. Neither did the state undertake an analysis ofthe racial an(1 ethnic composition of job classifications. Only 3.8 4For an alternative methodology based on the same principles, see Steinberg (1984, 1989~. The econometric literature on pay equity debates whether the full difference between the male and female job lines can be explained by structural dis- crimination. These arguments are less important in single-firm analyses of comparable worth, in which firm size and sectorial differences in the employment of men and women have, by definition, been held constant. See Aaron and Lougy (1986), Aldrich and Buchele, (1986), and Bielby and Baron (1987~.
MPaCT OF PAY EQUITY ON PUBLIC EMPLOYEES 2.8 in 2.7 O 2.6 2.5 "O 2.4 2 3 cat 2.2 O 2. 1 ~ 2 >_ 1.9 ~ 1.8 i, 1.7 I 1.6 ~ 1.5 0 1.4 1.3 1 2 1 1 _ o ~ 1 01 ~ 1 1 1 1 1 1 1 1 1 1 80 100 120 140 _ · · CO o ·0~0 0 203 _ · oo o 8 · ~ . . o ·" ~ I I J 160 180 200 220 JOB EVALUATION POINTS 240 260 280 FIGURE 9-1 Minnesota state government wages for male- and female-dominated jobs: Before pay equity. Note: · = male-dominated job class (80 percent or more male incumbents); 0 = female-dominated job class (70 percent or more female incumbents) (balanced job classes not indicated). Source: Commission on the Economic Status of Women (19854. percent of the state work force comprised racial and ethnic minorities, a percentage slightly higher than the population average for the state as a whole. As with the technical analysis, much of the education of employees about pay equity occurred before or during the legislative process. AFSCME had a particular interest in educating its members about the issue because it represented 62 percent of all state employees, including 75 percent of women working for the state, and almost 85 percent of the employees receiving pay equity raises (AFSCME Council 6, News Release, July 25, 1983; Council on the Eco- nomic Status of Women, 1982~. In the two predominantly female bargaining units (health care nonprofessional and clerical), the union actively promoted pay equity. In the four predominantly male bargaining units (craft, service, technical, and correctional guards), the union quietly responded to worker unease that pay equity would come out of the general salary increment. Other bargaining organizations paid scant attention to the issue because few of their members would benefit. 6 After the legislation passed, employees dill not get much information about how pay equity would affect them. Employees who were eligible for pay equity raises dill not receive official notification from unions or the state. Changes in one's paycheck formed the major "notification" of pay eq- uity, a notification that did not distinguish between regular pay raises of approximately 3 to 4.5 percent per year and the additional 6A number of labor organizations, like the Minnesota Association of Professional Employees, supported the policy of pay equity but did not publicize it among their members.
204 increment available through pay equity raises. The state took 4 years to implement fully the pay equity raises. The average raise totallect $2,200, with $1,600 added to wages in the first 2 years and $800 added the last 2 years. Approximately 8,500 employees, 90 percent of whom were women, received pay equity raises out of a total state work force of 34,000 (Commission on the Eco- nomic Status of Women, 1985~. The Department of Employee Relations and AFSCME reported receiving only a very few complaints about the policy and its implementation (1987 interviews with Peter Benner, lames Lee, and Lance Teach- worth). The only major problem that arose was salary compression. The Minnesota As- sociation of Professional Employees (MAPE) reported that its members resented the fact that the salaries of nonprofessional employ- ees (say, accounting clerks) were now con- si(lerably closer to salaries for professional employees (say, entry-level accountants). MAPE also believed that the salaries of balanced classes should also have been raised to the salaries of equivalently valued male- dominated positions, an action that the state chose not to take. MAPE has sought to resolve the problem through salary nego- tiations. The relative ease with which Minnesota implemented the policy rester] on three factors. First was the atmosphere of re- spectful and relatively calm labor relations. Second was the state's smoothly running personnel system. Minnesota has an excel- lent compensation staff as well as comput- erized salary and personnel information. Both of these capacities allowed for the easy calculation of pay equity raises and their rapi(1 inclusion in paychecks. Third was the prior existence of a job evaluation study unrelate(l to the pay equity debate and the implementation of raises. It is job evaluation that has proved to be the most controversial aspect of implementing pay equity in other jurisdictions (Evans and Nelson, 1989a,b). PAY EQUITY: EMPIRICAL INQUIRIES WAGE CHANGES AND LABOR RELATIONS The advocates and opponents of pay eq- uity who have speculated about its conse- quences in the workplace have emphasized its effects on job satisfaction and employee relations. In their speculations they have simply assumed that pay equity would be well known to employees, personally salient both to those receiving and not receiving the raises, and a major contributor to actual and perceived differences in work experi- ences. The history of pay equity in Min- nesota, however, and the larger body of research about labor relations lead us to expect somewhat different consequences from implementing pay equity. Given the long-standing controversy over whether and when employees attempt to maximize wages, it is remarkable how little research has investigated what employees actually know about the direct and indirect financial rewards of their labor. Two types of information are available from this small bo(ly of research: estimations by college students of the salaries available in various occupations, and less scholarly work on employee knowI- edge of benefits. The studies of salary knowI- eclge in(licate that both college women and men have an equal, and not particularly ac- curate, knowleclge of the salaries of both tra(litionally male an(1 tra(litionally female oc- cupations (Yanico and Hardin, 1986; Yanico and MihIbauer, 1983~. In studies of men and women with the same college majors, but not necessarily the same career aspirations, women also believe that they will have Tower entry salaries an(l lower peak earnings than their mate counterparts (Major and Konar, 1984). The reports generated by the business community on encouraging employee appre- ciation of benefit packages suggest that em- ployees know very little about the specifics of their benefits and that union members are no more knowledgeable than nonunion mem- bers (Cuthbertson, 1984; FindIay, 1984; Forbes, 1984; Hourihan, 1983).
IMPACT OF PAY EQUITY ON PUBLIC EMPLOYEES The literature offers few guideposts to hypothesizing about the effects of a change in wage policy on workers' knowledge of their own financial situations. We suggest that employees who are better off materi- ally, in terms of salary and education, and employees who are more powerful orga- nizationally, especially managers and professionals, will have greater accurate knowle(lge about pay equity policy an(l prac- tices. This general relationship will be me- cliated by the salience of the issue to in- dividuals. We expect that employees in traditionally female-dominated occupations eligible for raises wfl} be more attentive ant] hence more knowledgeable. But we must also caution against "over determining" em- ployees' responses to pay equity. Pay equity is only one part of the financial situation of employees, and remuneration is only one part of the work environment. Even those who might be advantaged most by the policy change would reasonably have a limited interest in the topic, especially when in- formation is provided selectively, as it was by AFSCME in Minnesota. There is a much richer research tradition concerning job satisfaction. This literature shows that job satisfaction is the product of several related qualities of work life: the intrinsic nature of the work; the "conve- nience" aspects of the work, including work- ing conditions in the broadest sense; finan- cial rewards, including salary, fringe benefits, ant] security; relations with co-workers; abfl- ity to clevelop a career; and adequate re- sources to do the job (Kalleberg, 1977:128; CheTte et al., 1982; Crosby, 1982; Mottaz, 1986; Staines and Quinn, 19791. Overall, people with higher salaries and more in- trinsically interesting work (which often in- volves a good clear of independent judgment) are more satisfied with their jobs. The process by which individuals deter- mine job satisfaction is somewhat more com- plicated, however. Individuals determine job satisfaction by comparing the job traits they value with the job traits that are re- 205 warcled in their firm. Expectations about rewards, type of occupation, and gender- based socialization to work roles are espe- cially important in understanding expecta- tions of work satisfaction. Most studies show that women are at least equally as satisfied with their work as are men, but women's satisfaction is believed partly to be a function of low expectations and low rewards, es- pecially for women in nonprofessional, fe- male-dominated occupations (Campbell et al., 1976; Kalleberg, 1977; Mottaz, 1986; Murray anc] Atkinson, 1981~. One of the problems with the job satis- faction research is that it stops short of proposing how changes in the workplace affect satisfaction. Although Kalleberg (1977) and Kalleberg and Griffin (1978) discuss how changes in the economy affect job satisfac- tion, the majority of the research on job satisfaction uses cross-sectional data to dis- cuss current satisfaction differences be- tween groups of employees. If one stays within this paradigm, one is brought to the untenable position that a change in mon- etary expectations and an "equivalent" change in monetary rewards results in no change in the total amount of job satisfaction, thus denying the effects of experiencing changes in expectations and rewarcls. The introduction of a pay equity wage policy in the state of Minnesota offers the opportunity to rethink and test, in a very preliminary way, the consequences of wage changes on employees' job satisfaction. The important theoretical question is, Does pay equity change expectations, ancI if so, how an(l with what results? As a policy, pay equity says that the work traditionally done by women is more valuable than the pay available for it has reflected. To the extent that individuals know about pay equity and believe its premises, the policy has the power to change expectations, where ex- pectations reflect both altered perceptions of deserving higher salaries and wanting them (Crosby, 1982~. If individuals know about the policy and also receive the raises,
206 they will have increased their expectations and increased their rewards, possibly in- creasing their job satisfaction. Likewise, if individuals know about the policy and thus increase their expectations but clo not re- ceive pay equity raises or do not know about their pay equity raises, they may be less satisfied with their work overall. We suggest that the process of expectations and rewards affects overall satisfaction with work. Clarifying assumptions about context is crucial when presenting a process approach to job satisfaction. We suggest that raised expectations and raised rewards will yield greater job satisfaction because the pay eq- uity policy and the implementation process in the state of Minnesota were not very conflictual. The policy was implemented in an atmosphere of good labor relations and thus was not attached to any other griev- ances that might color employees' knowI- edge of or response to it. Similarly, the job evaluation was done prior to and completely separate from the implementation of the raises. Because the state of Minnesota sep- arated job evaluation from pay equity anal- ysis and policy, the implementation process reflects the impact of wage change, not job comparisons. DATA AND METHODS Survey Design The data used in this analysis are from the Public Employee Survey of 493 state of Minnesota employees fielded by the Min- nesota Center for Survey Research in June 1985. Before fielding the survey, the Com- parable Worth Research Project cliscussed the survey with the Department of Em- ployee Relations and every public union and labor organization representing state employees. The survey design integrated a mailed questionnaire and telephone survey methodology. A sample of 1,000 employees was con- tacted by two letters at work. Those who PAY EQUITY: EMPIRICAL INQUIRIES returned a postcard indicating their will- ingness to be interviewed were contacted at home. Respondents were quota-sampled at the telephoning stage to make certain that the final sample represented the 16 bargaining units in appropriate proportions. The response rate to the letters requesting participation was 65 percent. Backstrom an Hursh-Cesar (1981) consider a 70 percent completion rate for a mailecl questionnaire extraordinary. Analysis of the characteristics of the 493 individuals finally interviewed by telephone and those not interviewed but mailed initial letters found that the two groups were quite similar in terms of gen- ler, job locations, and bargaining units. Variables The telephone survey asked 176 questions on work history, attitudes toward public employment, employee experiences in the workplace, worker satisfaction, information and attitudes about pay equity, experience with Minnesota's pay equity policy, political beliefs, use of social programs, and socio- economic an(1 demographic information. The analysis presented here uses a specific set of questions clesigned to determine respon- (lents' support for, knowledge about, receipt of, and reactions to pay equity, as well as a number of variables that measure material and organizational position ant! ideological beliefs. Support All respondents were asked a question to ascertain their support for the pay equity concept. It read, "If studies showed the work of delivery van (Irivers and clerk typists required the same level of skill, training, responsibility, and so forth, should an em- ployer pay these types of positions the same?" The (lelivery van driver and clerk typist positions were equally rate(l in the Hay Associates job evaluation stu(ly conclucte~l in Minnesota.
IMPACT OF PAY EQUITY ON PUBLIC EMPLOYEES Knowledge To ascertain knowle(lge of pay equity, all respondents were asked, "Have you heard anything about pay equity or comparable worth?" To determine the accuracy and depth of respondents' knowle(lge of pay equity, respondents were asked if they agreed or disagreed with the statements, "Only women can get pay equity raises" and "Pay equity will increase the state retirement benefits of people getting these raises." Exper~ence Respondents were also asked, "Did you receive a pay equity or comparable worth raise in 1984?" This information was later cross-checked against the official list of job classifications eligible for pay equity raises. Respondents gave information on the size of their pay equity raises for contract year 1984, which was just ending. This infor- mation was also cross-checked against the state's salary scheclule. Perceived Impact Reactions to the long-term consequences of pay equity were determined through two kinds of questions. First, we asked respon- dents who knew about pay equity whether they agreed or disagreed with two state- ments expressing possible negative conse- quences of the policy. The statements were, "Pay equity causes many problems in the workplace" ant] "Pay equity will result in some salaries being frozen." Second, we asked all respondents about job satisfaction with the question, "Within the last year, have you felt that your work is a satisfying experience very often, occasionally, or rare- ly?" Material Position Material position was defined as a com- bination of social location and inclividual 207 resources measure(l by sex, age, education, and salary. Using 1985 salary (1ata available from the Department of Employee Rela- tions, we calculated 1984 salaries as 4.5 percent lower than 1985 salaries, 4.5 per- cent being the average raise AFSCME em- ployees received for 1985. Organizational Position Years employed by the state of Minne- sota, type of occupation as measured by the three-digit census code, anc] full- or part- time work were used to measure organi- zational position. Questions about depart- ment, union membership, intensity of union activity, an(1 bargaining unit were asked, but they showed little variation and were not predictive and are thus not presente in this analysis. Ideological Beliefs Ideological beliefs were measure(l by a question forcing respondents to identify themselves as liberal or conservatives an a question inquiring about support for the women's movement. The latter question was, "In terms of achieving equal rights and opportunities for women, do you fee! that the women's movement in this country has not gone far enough, has gone about as far as it should go, or has aIrea(ly gone too ~ I,, lard Sample Characteristics Before discussing the specific findings about pay equity, it is useful to present some general information about the state of Minnesota's work force as reflected in this sample. As mentioned before, the state employs 34,000 full-time workers, 7Twenty-five respondents volunteered that they were "moderates." The background, beliefs, and behavior of moderates were virtually identical to those of liberals, and they were coded with them.
208 86 percent of whom are represented] by 11 unions. Bargaining occurs through the 16 functionally defined bargaining units.8 Not surprisingly, the state employs well- educated workers: 4 percent had not grad- uated from high school, 28 percent were high school graduates, 31 percent hail some college work, and 37 percent had a bach- elor's or advanced degree. The 68 percent of state workers with at least 13 years of education compares with the 35 percent of the adult population in Minnesota (as measured by those 25 years or older) that has the same level of education (Minnesota Department of Employee Relations, 1987~. By an(l large Minnesota employees like working in the public sector and like the type of work they (lo. Specifically, 83 per- cent of the respondents said the government is one of the best employers to work for and 62 percent reported that they wished to remain doing their current type of work. Two-thirds of state workers had worked for the state for 7 years or more, but only half of these long-term employees had worked at the same job within state employment for 7 or more years. Like most public em- ployers, the state of Minnesota has a strong internal labor market. State of Minnesota employees are fairly well paid, in part because they are so heavily unionized. The mean salary in contract year 1984 was $22,500. But the distribution of salaries was highly depen- dent on gender. Whereas 60 percent of all employees ma(le more than $20,000, there were significant gentler differences in those who earned $20,000 or less. Just over a quarter (27 percent) of male em- ployees earned $20,000 or less, but just over half (55 percent) offemale employees earned that wage. 8The University of Minnesota was chartered before Minnesota became a state, and thus, university em- ployees are not state of Minnesota employees and are not counted in the tally of state of Minnesota workers. PAY EQUITY: EMPIRICAL INQUIRIES FINDINGS Support Within this setting, the first task of the analysis is to answer the questions on em- ployees' support for the concept of pay equity and its application in their workplace. Employees gave the concept of pay equity overwhelming support: 81 percent reported that if studies foun(l the positions of delivery van driver and clerk typist equivalent, the two positions should be paid equivalently (Tables 9-1 through 9-31. Political attitude research has consistently found that Amer- icans are much more willing to support general equity or liberty questions than they are willing to support specific equity or liberty questions. More people, for exam- ple, support the idea of free speech than support an atheist speaking at the public library (Aberbach et al., 1981; McClosky and Brill, 1983; Wynia, 1974~. Thus, support for specific comparisons between jobs in- dicates strong support for pay equity. Most groups in our survey gave the con- cept of pay equity strong support, even those who have been hypothesized by op- ponents to oppose the policy. For example, 79 percent of managers supporte(1 equal pay for drivers and typists, as (lid 78 percent of conservatives. More liberals (86 percent) supported pay equity than conservatives, but the high level of conservative support for the policy is the most striking feature of the ideological comparison. It was women and those who believed that the women's movement had not gone far enough who were especially strong sup- porters of the concept of pay equity. Almost 87 percent of women in the sample agreed with paying drivers and typists the same, compared with 76 percent of men. Likewise, 87 percent of the respondents who reported that the women's movement had not gone far enough supported paying drivers and typists equally, compared with 66 percent
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IMPACT OF PAY EQUITY ON PUBLIC EMPLOYEES TABLE 9-3 Support, Knowledge, and Impact of Pay Equity, by Ideological Variables 211 Support for Women's Movementa Support, Knowledge, Total Ideologya Not Far As Far Gone Too and Impact Population Liberal Conservative Enough As Should Far Support and knowledge Drivers and typists paid equivalently: % agreed 81.2 86.4 78.1b 87.3 81.0 66.2 (484) (213) (256) (228) (163) (77) Ever heard of pay equity: % yes 81.5 89.4 76.5 88.7 73.9 76.3 (493) (216) (260) (230) (165) (60) Pay equity only for womenC: % disagreed Pay equity means better pensionsC: % agreed Perceived impact 94.4 (395) 82.7 (370) 96.8 (189) 78.3 (175) gl.gd (197) 86.7b (188) 98.5 (202) 84.2 (190) 91.7 (121) 78.1 (114) 87.9 (58) 85.1d (55) Pay equity causes many problemsC: % agreed 35.9 28.8 42.6 30.0 34.7 57.4 (395) (190) (197) (200) (121) (61) Pay equity means some frozen salariesC: % agreed 59.2 61.0 57.94 60.0 56.3 64.44 (390) (187) (195) (200) (119) (59) Job satisfaction: % very satisfied 57.4 54.6 60.0 55.7 60.0 53.' (493) (216) (260) (230) (165) (80) NOTES: N's in parentheses. The x2 statistic for each distribution is significant at the .01 level unless otherwise indicated. aControlled variable population totals are smaller than uncontrolled variable population totals due to missing data. bX2 is significant at the .05 level. COnly asked of those who had heard of pay equity. ~X2 is not significant at the .05 level. Of those who said that the women's move- ment had gone too far. Interestingly, men and women expressed the same strong sup- port for the women's movement. Regardless of their position on the wom- en's movement, women retained strong sup- port for the concept of pay equity. Almost 82 percent of women who thought that the women's movement had gone too far sup- porte(1 pay equity compared with only 55 percent of men with similar opinions. Knowledge Just as the concept of pay equity was well supported, the actual policy was well known: 82 percent of state employees hack heard of pay equity or comparable worth. As with all the questions of fact in this survey, respondents with more organizational pow- er and greater informational and economic resources were more knowledgeable. In this instance, higher salary an(l higher status employees, e.g., managers an(l profession- als, were more knowleclgeable. In contrast, service workers were notably unknowlecige- able about the policy: only 49 percent ha heard of pay equity or comparable worth. For our interests, those who ha(l not heard of pay equity are particularly important to (refine. Of those who hail not heard of the policy, 59 percent earne(l $20,000 or less
212 PAY EQUITY: EMPIRICAL INQUIRIES per year (compared with 40 percent of the TABLE 9-4 Experience with Pay Equity: sample), 30 percent were service workers Reported Versus Actual Pay Equity Raises (compared with 11 percent of the sample), ant] 17 percent were part-time employees (compared with 7 percent of the sample). Having heard of pay equity or comparable worth does not indicate what specifically employees knew about it. Respondents who replied that they had heard about the policy were asked two questions about policy con- tent. The first question inquired about the common misconception that pay equity rais- es were available only to women, rather than to -all incumbents of female-dominated occupations. Almost everyone (94 percent) un(lerstoo~1 that pay equity raises went to men as well as women. The second question determined whether respondents believed that pay equity would increase the state retirement benefits of those receiving this kind of raise. Here, too, employees were quite knowledge- able 83 percent knew that pay equity rais- es would also raise pension benefits. Vir- tually all employees with at least 17 years' or more tenure with the state, regardless of age or income, correctly understoocI that pay equity would improve pensions.9 This suggests that state employees who are be- ginning to think about retirement know at least the rudiments of the formula that determines retirement benefits. Experience In terms of the consequences of pay eq- uity for employees and for the success of the pay equity reform movement, the most important questions in the survey deal with the experience of employees with pay eq- uity specifically, who thought she or he got a pay equity raise and who actually received one. When asked about receiving Seventeen years of tenure with the state is ap- proximately one-half a standard deviation above the mean tenure. Group Received No Raise Raise Received - 75.7 [56 9] 87) 12.0 [21.6] 33 37.1 [21. 6] (33) 00. 1] 53) Row Total Raise reported (N) No raise reported (N) Never heard of pay equity (N) Column total (N) NOTE: Both row and column percentages presented; column percentages are in brackets. x2 is significant at the .01 level. a pay equity raise, 24 percent of respondents reported receiving one, 58 percent reported not receiving this raise, and 19 percent never heard of the policy and so were not asked. The results of a cross-tabulation of sub- jective ant] actual raises reveal very im- portant findings (Table 9-4~. On the one hand, 76 percent of those who reported receiving pay equity raises and 88 percent of those who reported not receiving raises were accurate in their reports. On the other han(l, if we examine those who actually received a pay equity raise, only 57 percent knew they received it. Almost 22 percent reported not receiving a raise, although they received one, and almost 22 percent never heard of the policy, even though they re- ceived a raise. The social movement po- tential of pay equity is certainly unfulfilled if approximately 43 percent of the people who benefit from the policy are unaware of their benefits. The information from Table 9-4 can be displayed and analyzed in another form. Respondents can be (livi(le(l into six groups representing their subjective and objective pay equity raise situation, as shown in Tables 9-5 through 9-7. Groups 2 and 4 were 24.3 t8.6] (28) 88.0 [74.2] (242) 62.9 [17.2] (56) t100.0] (326) 100.0 115) 100.0 275) 100.0 (89) (479)
213 11 V) o o o - . Ct C~ U) 1 b~ C~ C~ s~ ._ U: - ._ ._ C~ - Ct . _ C~ U) U) ._ Ct o C~ A o 7 C~ c°q Vl r~ Al 11 CD Z ~ - ;- Lr: ~ _ ._ C~ ~s C~ Vl CD Al ~ l 11 z ~ o b~ c~ Vl :t 11 z - ;^ a' . ._ o C~ ~ C~ C) -- ~ ~ p~ ~ ;.~ V Z ·3 C~ · _ x v ~ ~ oo o . . . . _ o C~ o C~ o C~ . . . . . . C~ ~ o C~ _ oo ~ U) ~ C~ C] _ o C~ C~ X oo X o oo oo ~ U: _ U: _ ~ CC ~ oo C~ X cS CC _ . . . . . oo ~ ~ C~ o _ C~ ~ C~ _ ~ C~ o o . . . . . . ~ _ X o C: _ C~ ~ O0 ~ O (D ~ cM ~ ~ 'o ~ cO c~ _ C~ d~ c~ cM ~ o o ~ ~ o c~ c~ ~ c~ c~ ~ ~ ~ ~ o c~ ~ C'] m, ~i _ ~ c~ ~ ~ ~ ~ ) ~ u:, - ~ o ~ o ~r c~ ~ ~ ~ ~ c~ c~ - c~ ~ x ~ ~ c~ c] o ~ ~ c~ ~ o c~ C~ C~ ~ C5) O CC ~ CS CD ~ cM ~ ~ ~ ~ oo ~ 'o c~ c~ ~ oo 'o - - ~ - - - ~ oo Lo ~ c~ ~ cD U: O _ X ~ (D ~ - - .' o - v ~ tv v ~ , ~ o o ~, ~ o ~ z so~ to v v ~ ~ - o o - - . . . , ~' ~ v ~ ~ - s~ ~ o ~ - - o ~ z z - ~ a; ~ ~ - o ~ ~ - z ~ .. .. . ~ ~ . ~ . o o o o ~ 50 s~ ~ v v v v c~` ~ - . - .' o v) V, _ _ _ - - o - I - v C~ ·_ bf ._ U' ._ O ._ · _ V ;> s~ 40 0 v ·_ .' ._ C~ C~ X . . E~ o z - C~ v C~ ._ ._ V) V) ._ C~ X
214 1 ,= o 11 Z U: bt Ct C~ 1~_ U: - ._ 50 Ct - o ._ Ct ._ Ct b~ o V) V: ._ C~ :^ ._ ._ ._ x CS E~ C~ _ C~ ~, o ,. .' C~ ~ o P~ ~ - ^ ~ Ct ·' o ~ j o U) _ ~ co ~ C~ d~ . . . . . . U: _ C~ . . . . . C~ C5) ~ ~ ~ X _ ~ ~ C~ CO _ ~ _ . . . C~ CM _ ~ _ O (D o C~ ~ ~ o . . . . ~ C~ o _ CO o o o o o o o o o . . ~ o a; o ~ _ ~ C~ o o o o - -^ C) 11 Z 4 ~ 50 o C~ o bC Ct Ct x o 11 ^~ z ~ - ~ c~ s~ u) c~ ~ o o ~ c) ~ ~ =4 o =' C~ ~ CD ~ U: . . . . . . ~ ~ oo ~ - ~ - ~ ~ ~ - ~ oo . . . ~ ~ - ~ - ~ . . o co - ~ c~ o 's ~ x ~ - c~ - x l o ~ oo o ~ - c~ - c~ ~ . c~ ~ o ~ ~ o c~ ~ ~ oo o c~ c~ - - cs cs ~ c~ cO ~ co oo c~ cM ~r o ~ c~ cO - ~ ~ : CD - - - o o o - - ~ ca - o c~ o c~ ~ CD r~ c~ oo c~ - ~ oo ~ - c~ - ~ c~ =^ -~^ ~ ~ ~ =^ a ~ a ~ a' a.= a. 0 Z=' ° Z ° ~ ~ Z .. .. .. .. .. .. C~ C~ ~ ~ CS S~ 5°- - ° S°- 5°- S°- 5°- V V V V V V C~ Ct C~ ._ bC ._ U' .' 0 ._ == V' ._ =5 Ct S~ <-o, .o ~7 ._ C~ ~X .. O Z
215 Cal CD 11 A no Ct Cal sol U: Ct ._ Cal Ct C) ·bt o - o a; ~ :^ . U: U. Cal ._ ._ 3 a' C) · _ x Ed C no o Ct ~ o Cal ~ ~ Cal C~ V, ¢ ~ o ~ bC Z° ~ C~ 11 bC o o U) o c) - . ~ ~ ~ _ a; =0 ~ L~ c,) Z o ~ ~ o CO o ~ ~ C~ C~ O ~ C~ CD ~ C~ o0 0 CD GO X C~ C~ ~ C~ C~ o o o ~ CO ~ C~ C~ ~ ~ CO CM C~ CS ~ ~ ~ ~ C~ . . . . . . X C~ C~ ~ ~ C~ ~ ~ ~ oo C~ C~ ~ ~ C~ ~ c~ ~ ~ - ~ ~ x ~ cs r~ c~ c~ c~ c~ ~ oo c~ c~ oo ~ ~ cM ~ o ~i oo co ·~ ~ ac¢ ·~ ·ct o o o >~ ~ > =^ =^ ~ - s~ ~ 0 5 _ ~ O ~ Z Z . . sO~ V ~ ~ ~ a; o s~ =, a) 5_ O .. .. .. .. .. _ C~ C~ ~ U: O o O O O ~ s~ s~ s~ 50 ~ V V V V C~ C) ._ .= U) ._ _ o U, ~q a; - o Q) 5 - Ct C) ._ 5 bC ._ V' V2 ._ o ._ ~s~ ._ ~ Ct =0 O .o V' ._ C~ V) X .. E~ O - C~ Ct C) C~ ._ ._ V, V) ._ e~ X c
216 accurate in their reports; groups 1 and 5 were inaccurate; and groups 3 and 6 were unknowlecigeable. Accuracy increased markedly with each increase in salary and educational level. Only 53 percent of those earning $20,000 or less, and 55 percent of those with 12 or fewer years of education accurately reported their pay equity raise situation. In com- parison, almost 94 percent of those earning at least $30,000 and 91 percent of those with at least 17 years of eclucation accurately knew their pay equity raise status. (This last finding was jointly a function of the fact that these groups were disproportionately composed of men and the fact that, overall, only 7 percent of men in the sample received raises. ~ The composition of each of the pay equity raise groups tells us a great deal about the organization of the state's labor force. Look- in~ first at the accurate groups, croup 2 (no ~ O 1 \ ~ . \ . .. reported, no raise) comprises mostly men in high-prestige, male-dominated occupa- tions that were not eligible for pay equity raises. Group 4 (yes reported, yes raise) comprises mainly longer tenured women in clerical occupations. Turning to the inaccurate groups, group 1 (yes reported, no raise) was not particularly distinctive; its only notable feature was that most of the men who reported inaccurately were located in this group. Group 5 (no reported, yes raise) was similar to group 4 (yes reported, yes raise) in that it was pre- dominantly composed of women (90 per- cent), but this inaccurate group hacl more service workers and fewer technical and clerical workers. Group 6 (never heard, yes raise) was the least well-educated and well- pai~l of those getting raises. In many ways, these were the most marginal female em- ployees in state employment. lust over 30 percent were service workers, and 39 per- cent were part-time employees. In terms of social, organizational, and ideological po- sitions, those who had no knowledge of pay equity but received pay equity raises were the hardest to reach. PAY EQUITY: EMPIRICAL INQUIRIES Accurate knowledge of the amount of one's pay equity raise was unclerstandably rarer than accurate knowledge of receiving the raise. Of those who reported receiving a raise (N = llS), more than a third die! not know the amount of the raise. Of those reporting receiving a raise and attaching an amount to it (N = 73), 71 percent (N = 52) actually received a raise. Of those cor- rectly reporting a raise and volunteering its size, 18 percent (N = 9) were correct within + 15 percent of the real pay equity raise. It is clear from this analysis that state employees had better information about pay equity as a policy than they did about the policy's financial consequences for individ- uals. The fact that almost half of the recip- ients of pay equity raises did not know that they received them and even fewer couicl correctly name the amount is one conse- quence of the implementation process in the state of Minnesota. Perceived Impact We also wanted to know what employees thought would be the long-term impact of the pay equity policy (Tables 9-1 through 9-34. To determine the long-term effects, we asked respondents who had heard of pay equity whether they agreed or disagreed with two negative scenarios posited by op- ponents of pay equity. The first question asker] whether pay equity causes many prob- lems in the workplace: 36 percent agreed that pay equity caused many problems, while 64 percent disagreed with the statement. Men an(l women were similar in their views: two-thirds of both groups believed that pay equity dill not cause many problems. Most material and organizational variables were poor predictors of employees' beliefs about pay equity causing problems. Of these vari- ables, only tenure with the state differen- tiated beliefs. Almost 46 percent of those with 17 or more years tenure thought that pay equity caused problems. Many of these respondents did not support the women's
IMPACT OF PAY EQUITY ON PUBLIC EMPLOYEES movement in general or pay equity in par- ticular. Indeed, ideological variables were the most consistent predictors of beliefs about pay equity causing problems. Those who thought that the pace of the women s move- ment was appropriate or too slow die] not think pay equity caused problems in the workplace. In contrast, those who thought the women s movement had gone too far believed that pay equity cause(l many prob- lems in the workplace. Although it is pos- sible that the response to the question about problems in the workplace might be a result of experiences with the implementation of pay equity, it is unlikely that views on the women s movement are a result of pay eq- uity policies. In the absence of serious or widespread complaints about the conse- quences of pay equity, it appears that re- spondents fitted their expectations (and per- haps experiences) to their prior beliefs. The second negative question elicited a different pattern of responses. We asked individuals whether they agreed or disa- greed that pay equity would result in some salaries being frozen. As previously dis- cussed, this did not occur. No salaries were frozen or Towere(1 due to pay equity. None- theless, 59 percent of respondents believed that pay equity would result in some frozen salaries. Roughly 60 percent of every ma- terial, organizational, an(1 ideological group harbored this fear. No zero-order distri- butions distinguished this finding. Fear of frozen salaries may be linked to employees not being aware that there was a separate salary appropriation for pay eq- uity. State employees might also have re- acted to a much more complicated policy environment. A local government pay eq- uity act had been received more negatively, and nationally, the Reagan administration had made its opposition to pay equity more vocal (Steinberg, 1989~. The impact of pay equity on employees is found not only in their explicit beliefs about its consequences but also in the more indirect consequences of the policy on the 217 interpretation of the work experience. lob satisfaction is one such measure. As we discussed before, job satisfaction is the re- sult of the expectations and rewards asso- ciatec] with several qualities of work life. The kink] of global measure of job satisfaction reported here reflects an individual s overall assessment of those qualities and does not have the specificity of a measure asking about satisfaction with the financial aspects of one s job (Nelson, 1981~. Likewise, cross- sectional data provide a current snapshot of job satisfaction without explicit reference to past levels of satisfaction. Mindful of these characteristics of the measure and the data, the survey founc] that state of Minnesota employees were quite satisfie(l with their employer and with their jobs. In the year prior to the interview, 57 percent found their jobs satisfying very often, 34 percent occasionally found their jobs satisfying, and 9 percent rarely found their jobs satisfying. This pattern remained the same for men and women, high- and low-salary employees, average and welI- educate(l workers, and people of every or- ganizational experience and ideological per- suas~on. The only (listinctive pattern of job sat- isfaction was associate(1 with the accuracy of reporting an(l receiving pay equity raises. Table 9-8 shows that the most satisfied employees were those who had accurately known about their pay equity raises (group 4), 68 percent of whom found work satisfying very often. Those who knew about the pay equity policy but not about their own raises were among the least satisfied employees. Only 39 percent of group 5 (no reported, yes raise) reported being satisfied with their jobs very often. In fact, group 5 had tower job satisfaction than group 6 (never heard, yes raise), 55 percent of whom reported being very satisfied with their jobs. The pattern of much higher levels of job satisfaction in group 4 (yes reported, yes raise) than in group 5 (no reported, yes raise) hell] constant when the cross-tabu- lation was separately controlled for sex, job
218 PAY EQUITY: EMPlRlCAL INQUIRIES TABLE 9-8 Perceived Impact of Experience with Pay Equity Raises on Job Satisfaction Very Occasionally Rarely Perceived Impact Satisfied Satisfied Satisfied (N) Group 1: Yes reported, no raise 53.6 42.9 3.2 (28) Group 2: No reported, no raise 57.9 30.2 12.0 (242) Group 3: Never heard, no raise 60.7 37.5 1.8 (56) Group 4: Yes reported, yes raise 67.8 25.3 6.9 (87) Group 5: No reported, yes raise 39.4 48.5 12.1 (33) Group 6: Never heard, yes raise 54.5 42.4 3.0 (33) NOTE: x2 significant at the .05 level. tenure, education, and salary. In a very modest way, these results suggest that in- creasing expectations (in the form of knowl- edge about a new wage policy) and increas- ing rewards related to those expectations (through pay equity raises known to indi- viduals) increase job satisfaction. Similarly, increasing expectations ant] not communi- cating rewards decrease job satisfaction. DISCUSSION Pay equity is now completely imple- mentec3 for state of Minnesota employees. In human terms, the adoption of this policy meant that the base pay of an entry-level clerk increased $2,256 over 4 years, quite apart from the $1,753 basic salary raises negotiated for this job cluring the same time. From 1981 to 1986, the ratio offemale wages to male wages rose from 74 percent to 82 percent (Minnesota Department of Em- ployee Relations, 1987:5~. These salary changes reflect in large part a change in the relationship of wages in female- and male-dominatec! occupations receiving the same point value in the state's job evaluation system, although some part of the increase may also be due to increased representation of women in high-paying professional jobs. Through political organization and technical analysis, pay equity supporters made avail- able to state employees in traditional female occupations some of the monopoly rents traditionally available to organized male pro- (luction workers in other oligopolistic sec- tors (Edwarcis and Podgursky, 1986; Ed- warcis, 1979~. The vast majority of the employees ex- periencing this change supported the con- cept of equal pay for work of equal value ant] knew about the general existence of the policy. Over four-fifths of those who had heard of pay equity knew that it would improve the pensions of those who received the raises, ant] knew that pay equity was not just for women. Beyond issues of knowledge and support, the interpretation of employees' responses to pay equity is somewhat more compli- catecI. At the legislative level, AFSCME chose an institutionally sensible strategy of promoting pay equity in the predominantly female bargaining units and merely re- sponding to the worries of employees in predominantly male bargaining units, a pol- icy that the Department of Employee Re- lations implicitly supported as well. From AFSCME's perspective, too much publicity would have raised concerns not applicable to the implementation of pay equity for state employees, concerns focusing on whether the raises of women workers came from what might otherwise have been a larger general salary settlement. At the implementation level, however, AFSCME simply did not notify people of the pay equity raise, nor dill the union make any distinction between pay equity raises and general raises. This strategy, and the lack of information in newspapers and other public sources about how the policy affecter] specific jobs, led to a situation in which
IMPACT OF PAY EQUITY ON PUBLIC EMPLOYEES almost half of those receiving raises die] not know about them, either because they thought they ha(l not received a pay equity raise or because they hac] not heard of the policy. The paradox of AFSCME s strategy is that in order to dampen opposition the union implicitly chose to dampen support. This is especially evident when assessing the im- pact of receiving raises on job satisfaction. Although job satisfaction was relatively high for all employees, those who correctly re- ported receiving pay equity raises were the most satisfied with their work. Those who knew about the policy but die] not know that they ha(l receive(l a pay equity raise were the least satisfied with their jobs. AFSCME s strategy traded off the potential increase in satisfaction arising from all the beneficiaries knowing about their benefits against the potential increase in clissatisfac- tion of nonbeneficiaries arising from nega- tive perceptions of the policy if it were more widely known. The strategy seems wise in light of the beliefs held by some employees about the long-term consequences of pay equity. Em- ployees maintained some negative expec- tations for the policy. Slightly over one- thircl believed pay equity cause(l serious problems in the workplace, ant] almost two- thirds thought that some salaries wouIc] be frozen. Those who believed that the wom- en s movement had gone too far were the most likely of any group to believe that pay equity caused problems. Knowing that for- mal complaints were uncommon, it appears that individuals fit their views on this in- novation into their existing icleological frameworks. The importance of the finding about widespread] concern over freezing sa- laries is that it existed, even though no salaries were frozen at any point in the process, nor was there ever any discussion of freezing salaries. Ironically, it was just this kind of concern that AFSCME wanted to discourage. One of the conclusions that can be (lrawn from this analysis is that the strategy used 2~9 by labor or management in presenting pay equity to employees greatly affects how employees will respond. In essence, unions and employers make explicit or implicit political decisions affecting how easy or dif- ficult the implementation process will be. If either actor wants to generate concern and mistrust, it is very easy to clot As is the case in many political situations, con- veying accurate information specific enough to change peoples expectations, if not their consciousness, is much harder, especially if the information is technical. In Minnesota, AFSCME chose to target the employees most affected by pay equity and those most likely to support it, while not spending their limite(l resources trying to convince those least affected and most likely to be wary. AFSCME could use this strategy because it represented nearly two- thir(ls of the work force, including employ- ees who would and would not receive pay equity raises. The union was clearly suc- cessful, nurturing the good will of state employees toward equal pay for jobs of equal value. At the same time, however, some negative expectations persisted despite a positive experience. The strategy for and outcome of imple- menting pay equity might be very different in a work force not dominated by one union, or where pay equity is opposed by man- agement. In these situations employee re- sponses to pay equity could take one of two tacks. Unions might fight among them- seIves, each reflecting its concern that its members not lose their relative wage po- sitions; or unions might form coalitions to present a united front to managers less supportive than those in the state of Min- nesota. The choice of rivalry or coalition would itself (lepen(l on the power and in- terests of all the parties involved. ACKNOWLEDGMENTS We would like to thank Nancy Johnson for research assistance, Lavon Anderson an Lin(la Harris for computational assistance,
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