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Steve Contorno
By Steve Contorno April 18, 2014

Gary Peters says Koch brothers oppose Paycheck Fairness Act

Criticizing the Koch brothers and hitting Republicans for opposing the Paycheck Fairness Act are two key tenets of the Democratic midterm playbook.

So when we found the Democrat in Michigan’s open Senate race combining those attacks against his Republican opponent, effectively killing two birds with one stone — er, press release — we thought it deserved another look.

Here’s the backstory: Rep. Gary Peters, D-Mich., is a co-sponsor to the House version of the Paycheck Fairness Act, a bill that builds on the Equal Pay Act, in hopes of increasing pay transparency in the workplace. The Senate version of the bill failed to muster 60 votes needed to advance the legislation because it couldn’t garner support from Republicans.

Peters’ Republican opponent in the Senate race, former Michigan Secretary of State Terri Lynn Land, has come out publicly against the legislation for what it requires businesses to disclose.  

Peters, in response, has twice issued press releases this week insinuating that opposing the Paycheck Fairness Act is part of the agenda of Charles and David Koch, the billionaire brothers spending heavily on campaign ads (including in Michigan) to help Republicans win the Senate.

"Land has chosen yet again to stand with her out-of-state billionaire allies like the Koch brothers" in opposing the Paycheck Fairness Act, the Peters campaign wrote in a press release titled "Land Doubles Down on Koch Agenda."

We’ve caught Democrats in other states assigning positions to the Kochs with little evidence. For the purpose of this fact-check, we’re focusing on whether opposition to the Paycheck Fairness Act is part of the Koch brothers’ agenda.

What is the Paycheck Fairness Act?

First off, it’s already illegal to discriminate against a worker based on sex. Proponents of the Paycheck Fairness Act say this would add teeth to existing law by making it easier for women to learn whether they’re being discriminated against.

That’s accomplished by prohibiting companies from retaliating against employees for discussing their pay. Women would be able to discuss their salary with other employees at the workplace without worrying about violating a company policy.

In explaining Land’s opposition to the legislation, a spokeswoman said this provision would require businesses to disclose the pay of any employee to any worker who asks. But the bill specifically does not apply to an "employee who has access to the wage information of other employees as a part of such employee’s essential job functions."

The bill also makes clear that if an employer is citing a factor other than the employee's sex for a disparity in wages between workers, it must be related to education, training, experience or other job-related reasons.

Another key, and controversial, component of the bill would require the federal government to collect pay information from employers by sex, race and national origin of the employees. This information would be used to identify pay disparities within industries and potential discrimination.

Land’s staff said this information could be easily made public through a FOIA request or if the Equal Employment Opportunity Commission publishes it online, essentially creating a searchable database of salaries. However, that is an unlikely scenario, as the law instructs the commission to consider "appropriate protections for maintaining data confidentiality."

It’s also worth noting that employers with more than 100 workers are already required annually to fill out a form called the EEO1 with information on the race and sex of their employees. While it is sometimes used in academic research, names of employees are not included and the company names are usually protected.

Finally, in addition to education and awareness measures, the bill also allows employees who have been discriminated against to receive punitive or compensatory damages in a civil suit.

The Koch connection

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We asked Peters’ campaign for evidence that the Kochs oppose the Paycheck Fairness Act. They pointed us to the Center for Effective Government, a nonpartisan watchdog of money in politics.

In addition to tracking campaign finance, the organization also keeps tabs on who is lobbying the government. Companies, and firms hired to lobby on behalf of companies and groups, must disclose the issues they’re meeting with Congress about.

In 2009, Flint Hills Resources, a subsidiary of Koch Industries, spent $960,000 lobbying Congress on a wide range of issues, from energy to taxes. Listed among the bills Flint Hills Resources lobbied are a previous incarnation of the Paycheck Fairness Act and what would become known as the Lilly Ledbetter Fair Pay Act, which passed both chambers of Congress and was eventually signed by President Barack Obama into law.

Similarly, in 2010, Koch Industries hired the firm of Siff and Lake for $50,000 to lobby Congress on a handful of bills. According to a lobbying report, one of the bills was "S. 182, the Paycheck Fairness Act," a bill very similar to the current Senate bill. Specifically, Koch Industries wanted to discuss how the bill would change the way employers justify wage disparities.

The reports don’t specify whether someone is for or against the legislation. A spokeswoman for Koch Industries did not respond to multiple requests for comment. But their past positions opposing government regulation makes us confident they were against the legislation. If they want to get back to us to dispute this, we’re all ears.

Disclosure reports filed since have not indicated Koch Industries has lobbied on this issue, so 2010 was the company’s last public foray into the debate. Reports covering 2013 and the first three months of 2014 have not indicated Koch entities have focused on any of the Paycheck Fairness Act bills that have circulated Congress since last year (though they have until April 21 to finalize reports for Jan. 1 to March 31). Since the recently debated Senate bill was not introduced until April 1, it may take until July to learn if Koch Industries made a last-minute push against the legislation. 

While opposing the Paycheck Fairness Act may have been part of their agenda during earlier debates on equal pay, we don't know (and neither does Peters) if they weighed in on the bill now before Congress.

Peters’ staff also highlighted a post about the Koch brothers by Think Progress, a site affiliated with the Center for American Progress that provides liberal opinion and analysis. The piece notes how several conservative and libertarian leaning organizations with Koch financing are critical of congressional action on equal pay issues.

Most of the donations are relatively small compared with the overall funding of the highlighted groups. And not all of the people quoted by Think Progress were speaking directly on the Paycheck Fairness Act, but rather the general notion of a wage gap.

One group, though, Concerned Women for America, did receive a significant portion of their funding from Freedom Partners Chamber of Commerce, a group funded by the Koch brothers that primarily distributes checks. Concerned Women for America Legislative Action Committee received $8.15 million of the $8.7 million they raised in 2011 from the Koch-affiliated group, according to IRS filings. In 2010, the group raised less than a million dollars and just $2 million in 2012, the last records on file.

In a fact-sheet opposing the bill, Concerned Women for America called the Paycheck Fairness Act a "a one-size-fits-all policy" that "discourages flexible working arrangements" and "sidetracks businesses from their primary mission, which could lead to fewer job opportunities."

Americans for Prosperity, a group more directly tied to the Koch brothers that has aired ads in Michigan against Peters, has not weighed in on the Paycheck Fairness Act, a spokesman told PolitiFact.

Disclosure reports released later this year may reveal more information. But that's not information Peters was privvy to when he made his claim.

Our ruling

Peters’ campaign claimed opposing the Paycheck Fairness Act was part of the Koch agenda.

Federal disclosure forms show businesses owned by the Koch brothers lobbied on similar legislation in 2009 and 2010. And a Koch-connected group gave significant funding in 2011 to Concerned Women for America, a group that has opposed the current legislation.

But it does not appear Koch Industries has lobbied on equal pay issues since 2010, including the most recent legislation. Their most vocal organization, Americans for Prosperity, hasn’t entered the debate, either.

In making the claim, the Peters campaign was relying on evidence from several years ago. Even if disclosure reports filed in the near future reveal that Koch entities lobbied on the issue more recently, Peters linked the Koch brothers to the legislation without knowing their involvement. 

Weighing all of that, we rate the statement Half True.

Our Sources

Rep. Gary Peters press release, "ICYMI: Key Contrast: Land Doubles Down on Koch Agenda & Opposes to Equal Pay," April 14, 2014

Wall Street Journal, "Criticized by Obama, Senate Candidate Defends Fair-Pay Stance," April 12, 2014, S.2199 - Paycheck Fairness Act, accessed April 15, 2014

U.S. Senate, U.S. Senate Roll Call Votes 113th Congress - 2nd Session Vote 103, April 9, 2014

2009 Congressional lobbying report for Flint Hills Resources, accessed April 15, 2014

2010 Congressional lobbying report for Siff & Lake LLP, accessed April 15, 2014

U.S. House of Representative Office of the Clerk, 2014 Congressional lobbying disclosure search for "Koch," accessed April 16, 2014

Phone interview with Russ Choma, spokesman for Center for Responsive Politics, April 16, 2014

Email interview with Heather Swift, spokeswoman for Terri Lynn Land, April 15-16, 2014

Email interview with Haley Morris, spokeswoman for Rep. Gary Peters, April 15-16, 2014

Email interview with Rachel MacKnight, spokeswoman for Sen. Barbara Mikulski, April 15, 2014, Koch Industries Lobbying Profile, accessed April 15, 2014

Think Progress, Women From Koch-Funded Conservative Groups Lambaste Equal Pay Measure, April 9, 2014, 2011 IRS filing, accessed April 16, 2014 search for Concerned Women for America Legislative Action Committee, accessed April 16, 2014

Concerned Women for America, "Paycheck Fairness Act – S. 86," accessed April 16, 2014

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