Disney’s $43M gender pay settlement is a wake-up call — pay gaps can cost you big over time. Here's what you can do

Long-term costs of pay gaps

Challenging your employer over unequal pay can be intimidating — especially if you’re standing up to one of the world’s largest entertainment companies like Rasmussen. Yet, addressing pay disparities is essential.

Under the Equal Pay Act of 1963, individuals of all sexes are entitled to equal forms of all compensation, including salary, overtime pay, bonuses, life insurance, vacation and holiday pay, reimbursement for travel expenses etc., if they perform equal jobs. However, in practice, this standard is often unmet.

In the U.S., the gender pay gap has closed only slightly over the past two decades. In 2022, women earned approximately 82 cents for every dollar earned by men — a marginal improvement from 2002, when the figure was 80 cents, according to the Pew Research Center. Research also shows that the gender pay gap is more significant for women of color.

Being paid a lower amount than male counterparts doesn’t just affect your paycheck but it can also have a lasting impact on your financial health. For example, if a woman earns $60,000 annually, a man in the same role – earning $1 for every 80 cents she makes – would receive $75,000. That would be a $15,000 difference each year.

When you consider how much money that is over many years and how that money could grow with compound interest once invested, the true impact of the pay gap becomes more clear. Investing $15,000 every year assuming 7% average annual returns would deliver over $200,000 in a decade.

This disparity can lead to lower retirement savings, reduced investment opportunities and a smaller financial cushion for future goals.

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What you can do

“It’s really hard to know you’re experiencing [pay discrimination] because there is such a culture of secrecy around pay,” Emily Martin, the vice president for education and workplace justice at the National Women’s Law Center told The 19th. “Part of the answer to closing gender wage gaps and racial wage gaps … is greater pay transparency because sunlight is a disinfectant here.”

A good starting point to figure out where you stand on your company payroll is to speak to your colleagues. Employers cannot prevent employees from discussing their rate of pay with each other. While discussing pay can feel uncomfortable, transparency is often the quickest path to understanding if there are any discrepancies that exist.

Another option would be to turn to websites like Glassdoor, Payscale or LinkedIn Salary Insights, which aggregate salary data based on job titles, industries and locations. These can help you benchmark your earnings against others in similar roles.

For those in public roles, you can take advantage of public records. Government institutions are legally required to disclose salary information and you can easily search through them on websites like GovSalaries.

You can also review your company’s pay policies, any internal salary bands that may be shared in employee handbooks or HR documents, and new job listings that mention a salary. By combining data from multiple sources, you can get a picture of your earning and be positioned to advocate for fair pay if needed.

The American Association of University Women (AAUW) provides the steps you can take if you suspect pay discrimination. This list includes talking to someone at your workplace about filing an internal complaint or calling the U.S. Equal Employment Opportunity Commission (EEOC) hotline for general information about the laws EEOC enforces and filing a charge.