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  • Equal pay for equal work has long been a topic of concern in the fight for gender equality. In Pennsylvania, significant strides are being taken to address this issue as the state legislature contemplates measures to expand the state Equal Pay Law and the Pennsylvania Human Relations Act (PHRA).

    The proposed changes seek to redefine the concept of “equal work” and provide a framework for employers to justify pay differentials based on legitimate factors. Continue reading to explore the latest developments surrounding this important legislation and discuss its potential impact on employers and employees.

    Expanding The Scope: Senate Bill 36

    At the forefront of these developments is Senate Bill 36, currently under review by the state legislature’s Labor and Industry Committee. This bill aims to broaden the existing Equal Pay Law by replacing the term “equal work” with “comparable work.” While this change may seem subtle, it introduces the complex challenge of defining what constitutes “comparable work.”

    To address this challenge, the amendment defines comparable work as work that shares substantial similarities in terms of skill, effort, responsibility, and working conditions. In addition, the legislation clarifies that job titles or descriptions alone should not be the sole determinant of comparability.

    Protecting Employers: The Bona Fide Factor Defense 

    Recognizing that pay differentials can arise from various legitimate factors, the proposed legislation introduces the “bona fide factor defense.” Employers can utilize this defense if they can demonstrate the following:

    • The wage differential is based on a bona fide seniority system, merit system, a system that measures earning by quantity or quality of production or sales, or factors other than sex, such as education, training, or experience.
    • Each factor relied upon is reasonably applied
    • One or more factors accounted for the entire wage differential

    However, it’s crucial to note that the bona fide factor defense is available only if the employer can prove that it is job-related, consistent with business necessity, and not derived from a sex-based differential in compensation. This legislation defines “business necessity” as a legitimate business purpose that effectively fulfills the intended purpose, and the defense will not be applicable if an alternative practice can serve the same purpose without creating a wage differential.

    Challenges And Considerations For Business Owners

    While the proposed legislation aims to address pay equity concerns, it also presents challenges for employers. The focus on job titles and responsibilities as insufficient factors for determining comparability may require employers to scrutinize pay differentials within single job titles. This could result in an influx of claims requiring employers to justify their pay practices before the Pennsylvania Human Relations Commission.

    Should this bill become law, employers with employees in Pennsylvania will need to adapt and establish mechanisms to justify their pay differentials. Proactively addressing potential disparities and ensuring that pay decisions are based on legitimate factors will be crucial for compliance and maintaining a fair and inclusive work environment.

    How A PEO Can Support Pennsylvania Business Owners

    As Pennsylvania’s legislature considers expanding the state Equal Pay law and the PHRA, businesses must be prepared to navigate potential challenges and ensure compliance with evolving regulations. However, a professional employer organization (PEO) like GMS can assist business owners in Pennsylvania. We provide comprehensive HR solutions, including expert guidance on pay equity and ensuring compliance with the amended legislation. By partnering with GMS, business owners can navigate the complexities of the law while maintaining a fair and inclusive work environment. With GMS by your side, Pennsylvania business owners can confidently face the future and focus on what they do best – growing their businesses and supporting employees. Contact our HR experts today to learn more about how we can help your business.

  • Pennsylvania lawmakers have been working diligently to pass a bill that would expand coverage of medical procedures for chronically ill patients. While the bill mainly applies to private insurers, it would do the following for individuals in Pennsylvania:

    • Remove prior authorization for emergency care
    • Standardize timelines for insurers to approve or deny a request for treatment
    • Guarantee that doctors can request that plans cover medications without a patient first trying a cheaper drug

    Ultimately, the bill would allow medical providers more time on caring for patients as opposed to fighting with insurance companies. The patients will receive more clarity and flexibility when deciding on their treatment options.

    The current proposal passed the Republican-controlled state Senate in June. The bill is now waiting for the state House to vote, then the state Senate must approve the changes before taking additional measures.

    Diving Deeper Into The Bill

    The proposal aims to change two fundamental aspects of American health care which include:

    • Prior authorization
    • Step therapy

    Prior authorization is a process used by insurance companies to determine if a prescribed product or service will be covered. Step therapy means trying less expensive options prior to “stepping up” to drugs that cost more. Both ensure that medically sound and cost-effective medications are prescribed appropriately. However, the bill would not completely eliminate either practice. Instead, it would require insurers to offer exemptions for both along with creating a standardized process for doctors to apply for approval or request an exemption.

    To accomplish this, the bill would:

    • Establish standardized electronic forms for the application
    • Set a statutory deadline for responding to requests
    • Require insurers to provide written notification explaining the denial
    • Allow the state Insurance Department to review the decision

    In addition, this bill would allow physicians to dispute an insurer’s decision directly with a doctor employed by the insurer rather than an individual who may not have a medical degree. The goal of the bill is to create a new and more effective process for prior authorization of medical services which will keep everything consistent and transparent.

    What Now?

    While individuals in Pennsylvania wait for a further notice regarding this proposal, it’s important to understand alternative solutions. This proposal still must pass through multiple stages for it to become a law. Partner with GMS to ensure your employees are covered under any circumstance. When you partner with GMS, it’s possible to reduce your health insurance costs while still providing top-tier coverage. GMS changes the approach to increase affordable options by giving small businesses the buying power of a large corporation. Contact us today to learn more.