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Good morning, Broadsheet readers! Mary Meeker’s fund makes its first investment, taking paternity leave affects how many kids men want, and Kamala Harris puts the gender pay gap on the 2020 agenda. Have a terrific Tuesday.
• Trying to bridge the gap. 2020 Democratic hopeful Kamala Harris announced a new “pillar” of her presidential campaign yesterday and, in doing so, landed firmly in Broadsheet territory. The California Senator introduced an equal pay measure to close the gender pay gap that sees U.S. women earn 80 cents to men’s dollar.
The plan would require all companies with 100 or more employees to earn “equal pay certification” by proving they pay men and women the same for doing work of the same value, or else be fined 1% of their profits for every 1% wage gap. It would also force corporations to report the share of women in leadership positions, bar them from asking about prior salary history, and prohibit them from using forced arbitration to handle pay discrimination claims.
Harris has deemed her plan a “first-ever national priority on closing that pay gap,” but it does have some close peers. It is similar to an Obama-era rule that required employers of 100-plus workers to report pay data by race and gender. (You might recall that the Trump administration tried to revoke the rule for being too “burdensome” to business, but a judge rejected that rationale in March—a ruling the administration is now appealing.) But Harris’s plan adds a punitive layer in the form of the fine, introducing what could be a powerful stick to the equation. That aligns her proposal with initiatives passed in Iceland and France, where gender pay gap reporting is accompanied by financial penalties. And that contrasts her idea with the approach taken in the U.K., where firms don’t face fines for the gender pay gaps they report; the idea being that naming and shaming is enough of a motivator.
Harris is already playing up the threat her plan imposes. At a rally on Sunday that previewed Monday’s announcement, she said her measure will hold “corporations accountable for transparency and closing that gap.”
“There will be penalties if they don’t,” she said to applause.
The fine certainly adds teeth to the initiative—plus it’s a revenue stream. Her campaign estimates it will generate $180 billion in its first decade, which will, in turn, help fund a paid family and medical leave plan that Sen. Kirsten Gillibrand has introduced and Harris has backed. But at the same time, the fine is, essentially, a new tax on business, which means implementing the plan in its entirety would require Congressional support.
That’s important since the proposal is likely to face opposition from Republicans. “We don’t need to strap new regulations, burdens or fines on businesses to create opportunities for women, and President Trump’s economic record is a testament to that,” a spokeswoman for the Republican National Committee said in response to the idea.
But on her side Harris has that pesky 20% pay gap, which is even worse for black and Latina women, and research that says that when companies are required to disclose their pay data their gender gaps shrink.
ALSO IN THE HEADLINES
• Inauguration day. Lori Lightfoot was sworn in as mayor of Chicago on Monday. She plans to reform the city’s politics, with goals to restrict alderman control over zoning and permitting, enact term limits for the mayor and council chairs, and ban elected officials from holding outside jobs.
• CEOs speak out. In the New York Times today, 11 women leaders from brands like Thinx, Cora, Fur, and Loom commissioned a full-page open letter declaring abortion a “human right” and calling on Corporate America to join them in standing up for reproductive rights.
• Debut deal. Mary Meeker’s Bond Capital made its first publicly-shared investment, leading a $70 million funding round for the Australian online design platform Canva. The startup, led by CEO Melanie Perkins, is valued at $2.5 billion after the round.
• Primary challenger. Shannon Liss-Riordan, a labor attorney who has represented Uber drivers in their cases against the company, will pursue a Democratic primary challenge in 2020, targeting Sen. Ed Markey for his Massachusetts seat.
IN CASE YOU MISSED IT
• If you give a dad paternity leave… When men take paternity leave, they want fewer children, a new study finds. The authors point to a few potential reasons why: it could be that men see how hard it is to raise a child when they spend more time at home in the early months, or they become more invested in the child they already have instead of wanting more immediately.
• Toddler turnaround. Jane Elfers took over as CEO of Children’s Place in 2010, and she’s turned around the kids’ clothing retailer. Sales are increasing—even amid the declining U.S. birthrate.
Wall Street Journal
• Sailors, stop! Sailors aboard a U.S. Navy submarine circulated sexually explicit lists ranking female crew members with lewd comments and Yelp-style ratings. There were 32 women among the submarine’s 173-person crew.
• Labor market benefits. The tight labor market is benefitting women looking to return to work after taking time off to be home with their children. Employers are considering candidates they might have overlooked with higher unemployment, including women starting “returnships” as they pick up where they left off in their careers.