Heart of the Matter, Susan Kochevar & Tony Gagliardi, March 3, 2016

Station: KLZ, 560 AM

Show:     Heart of the Matterm with the Americhicks, Molly Vogt & Kim Munson

Guests:  Kochevar, Gagliardi

Link:      https://soundcloud.com/the-heart-of-the-matter

Date:      March 3, 2016

Topics:  Colorado Pay Equity Commission, Golombek, Patty Kurgan, Tony Gagliardi, National Federation of Independnent Business (NFIB), Free Market Solutions, Value to the Table, Negotiating Salary and Benefits, Senator Rollie Heath,

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HOST MOLLY VOGT:  Thanks for joining us, Susan!


VOGT:  Yeah.  Susan is a small business owner, and she is also the chairman of the Colorado Republican Business Coalition.  She has been doing a lot of work on making sure that our legislature here in Colorado — and of course, here in America – is making sure that small businesses still have the rights to start new businesses, and create jobs for people.  And she has done a really great job with that. She has done a testimony, recently, down at the Capitol on this Pay Commission Act — Pay Equity Commission.  And so we invited her to come in the studio and talk us about that.  We’ve also invited Tony Gagliardi, who is the chairman — our Colorado state director for NFIB, the National Federation of Independent Businesses, because they also — just like the CRBC, but at a national level—seek to protect the rights of small business owners, their rights to own and operate and grow their businesses.  And so, this Pay Equity Commission, there was just a –.  What just happened?

KOCHEVAR:  Well, they set this up – Tony will know for sure, but I think it was 2007 or 2008, they started this Pay Equity Commission in Colorado.  And it was to study, you know, what they call a pay gap.

VOGT:  Mm-hmm.

KOCHEVAR:  So, they set up a commission and it was an all-volunteer, it was a — there was no money put into it, and it went on for a while.  And a lot of the members didn’t show up to actually participate in this ‘really critical problem’ –this pay equity – or pay gap discrepancy between women and minorities and men.

VOGT:  Mm-hmm. Right.  And so they’re saying, “We’ve got to make sure that the government has some local control, here.”  You’ve got the government at the local level that’s going out and making sure the small businesses are paying everybody equal.

KOCHEVAR:  Businesses in general.  They wanted to study this gap and see what could be done.  So, nothing was done the first time around and I went last year and testified to tell the folks at the Capitol that we didn’t need a Pay Equity Commission.  Was there probably a time when there was a pay gap?  Maybe.  But I would argue that that’s not the case now. And it certainly isn’t the role of government to take care of this.  Government can’t — can only make it worse.

VOGT:  Right, right. And it sounds like they didn’t do the right job. Tony, do you mind joining us in the conversation? Welcome to The Heart of the Matter!

STATE DIRECTOR OF NATIONAL FEDERATION OF INDEPENDENT BUSINESSES, TONY GAGLIARDI:  Thank you very much.  It’s always a pleasure to join you all.  Susan is absolutely right.  This Commission was established under the Ritter administration when then-Director of Labor Don Mares insisted that this commission be set up because we were facing a critical – there was a critical issue with pay gap in the work place.  And so, we at that time testified against this – establishment of this Commission.  It was signed and established, and therefore NFIB did demand that a small business representative be appointed to the Commission.  And we had a member appointed – Patty Kurgan — who to her credit, actually I think went to every meeting except one.  Many of them – Susan was absolutely right.  Most of the meetings, they did not have a quorum.  It was just a – it was Labor and advocacy groups stacked against – just with free reign to go after the business community, is what it amounted to.

VOGT:  Yeah, and it looks like you wrote a letter to the Colorado Department of Labor and Employment back in 2012 saying that you are not going to endorse the Colorado Pay Equity Commission –I am reading this letter that you shared with me earlier.  Do you mind telling our listeners why is it that you were not endorsing this?  What — Did they follow through on what they were supposed to do, or was it –?

GAGLIARDI:  No, and that was part of the problem.  First of all, they were to issue a report back to the legislature as to their findings and their activities. They were to establish a website. They were to post best practices.  And actually, what their charge was, was to be a resource for business owners who had concerns about this issue, or even thought maybe they do have an unintentional pay gap in their own in their own business.  And they did absolutely nothing.  And so then, the chairman, along with groups like the national 9-to-5 Organizational for Women, the IBEW union, the Colorado Center for Law and Policy, they come up with this policy report that was just — it was fictitious what they were putting in this report.  And so, therefore, Patty Corrigan and I both signed a letter to Director Golombek stating we could not the—and on behalf of the National Federation of Independent Business — we could not endorse the actions or the beliefs of the Pay Equity Commission.

VOGT:  Yeah, and I noticed that you had quoted a U.S. Department of Labor report and analysis—


VOGT:  –of the reasons for the disparity in wages between men and women.  Do you mind sharing some of those findings with us, because as we go through this election season right now, you hear – you know, we’re going to hear over and over, “Oh, we need so-and-so in place because we need the government to make sure that everybody is making exactly the same amount of money, drives the same car, has the same house.  So, is there really such a disparity?  And is everybody working the exact same hours with the same education with the same level of output?  Or did the Department of Labor find anything else for the reason and disparity in wages.

GAGLIARDI:  No, and Susan –again, Susan, who has just been a tremendous champion down here at the Capitol and just doing a great job of advocacy on behalf of small business owners– but like she said, maybe at one time there was a gap close to what the proponents like to get out there and say exist today, but it’s unfounded.  It’s unfounded by the Department of Labor and it’s also unfounded by the White House. And that’s the one that I’d like to refer to.  And we mention it in our letter.  The White House Report on the Status of Women, released in 2011, states that the gap is not what we are seeing, or what we are hearing.  And that the time in the workforce, with women compared to men, is less for women.  And when you take into consideration things like total compensation packages and that, it is very small.  And in fact, in many cases, women are actually out-earning meeting today.


HOST KIM MUNSON:  […] I had this experience.  I had – when I came to Colorado, I worked at a bank for a couple years and then I worked as an assistant on a stock trading desk.  I got my broker’s license, and I went to Boettcher and Company and did become one of the youngest VPs at the firm.  But when I started to have children I realized that I needed flexibility.  Now, I was on straight commission,–

GAGLIARDI:  Yeah.  Sure, sure.

MUNSON:  –so I controlled, you know, my destiny on that. And so, in essence, I made some choices to maybe not work as long hours, or to – I loved the flexibility to be with my children.  Ultimately, I realized that I needed to move to a more flexible career.  It was a choice for me. I never expected government to come in and say that I needed to be making the same amount as a man, because in that case, my choices for my flexibility and my hours would have gone away.  And so I did not want to — I don’t want government in my life in that way.

GAGLIARDI:  Mm-hmm. Yeah!  And you are so right.  And they just — the proponents of this commission just refused to accept that a woman’s participation in work — just like a man’s —  is by choice –is by choice.  They choose to start a family.  We have men taking maternity leave now when a newborn arrives.  And it’s just — but they refuse to accept the facts that are out there.  And in fact, they do — they are pushing for a one-size-fits-all employment policy that says, regardless, that everybody shall be paid equal.

KOCHEVAR:  Well, it really takes a lot of choices away from women and the business. I mean, there are so many things that they take away from the negotiating table, especially for women–

GAGLIARDI:  Exactly.

KOCHEVAR: –flex time, you know maybe you want more different kinds of medical care, depending on your children or family, and your situation, and your skills. It really takes a lot of choices and, you know, when it hurts you at the negotiating table, that’s where it where the rubber meets the road.


VOGT:  So, what – tell us about your time when you were testifying.  What kind of questions were you getting, or push back?  And what were the kinds of things you were hearing?

KOCHEVAR:  Well, it’s interesting.  One of the questions that I received one of the Senators was, “How has this Pay Equity Commission hurt you?”  And I think that’s a really important question, actually.  You know, they came out with these recommendations and the things that they wanted to do.  So, we set up this commission and what always happens, time and time again in government.  Any time you set something like this up, it expands and it eventually grows teeth.  And so, as I’m working down at the report earlier, I see that they had added some things that they wanted employers eventually to start filing some things about, you know, jobs, and how much they pay, and sort of help them keep track of all that stuff.  Well, that’s a lot of work, especially for a small business.  And then, pretty soon, they’ll start deciding, “Well, maybe there should be a penalty for this.”  Or—


KOCHEVAR:  And that’s – that was a good question, and that was my answer.  All government entities grow and develop teeth.

MUNSON:  That made me think of something, and Tony, I’d like you to comment on this. One of my other hats is I’m on City Council.


MUNSON:  And I’ve seen a lot of this economic development where big companies are getting breaks on, you know, like share-back, on sales tax,–


MUNSON:  –or they may get a break on business personal property tax, which is astounding to me that the big guys get the breaks and then the little guy over here – the little pizza parlor guy –is having to pay full fare.  And to Susan’s point, this commission is instituted and you have to start to do reports.  And so the little pizza guy not only is having to make pizza, he’s having to pay full fare, and now he’s having to file reports.  All he’s looking for in somebody is somebody that will come in and do a good job, whether or not it’s a guy or a girl.  And I’m sure he’s willing to pay for that.  And I just don’t see how it makes any sense to have government in this at all.



KOCHEVAR:  One of the things that I had said to the commission also, was that a government commission cannot change culture. Individuals can change culture.  So, I go through this thing where I’m explaining how my grandmother, at a time when women couldn’t buy homes, and she found herself single, she went to work and she went to work for a company that made products for space, where they protected spiders [???] that went up to the moon.  This was her job.  And she got this job and she bought a home.  And then my mother went on to run a business.  I’m running a business.  My daughter got a job in the oil fields which is typically male-dominated, she got a promotion and was paid the same.  So, it’s that kind of stuff that changes culture, not a government commission.

VOGT: Right.  Well, isn’t it already illegal to discriminate?


GAGLIARDI:  That’s right.

VOGT:  It already is.  Well, okay.  So – so—so, what happened is, now they have now decided that they are not going to continue this commission. Is that correct?

GAGLIARDI:  Yeah, what happened is the commission sunset-ed.  There was a sunset on the commission and it expired last year.  And so, originally, the Department of Regulatory Agencies (DORA), which conduct the sunrise/sunset analysis, recommended that it not be continued.  And evidently, there was some behind the scenes lobbying from the governor’s office at that time to reinstitute it — to recommend that it be continued.  And so there was a bill – it started in the state Senate last year, to continually –for continuation of the commission.  And that bill was killed.  And then a repre — and I can’t remember, Susan.  You might remember who in the House had a late bill introduced to do the same thing, and we killed that one again when it got over to the Senate.  And then this year, Sen. Heath tried to reinstitute it — and this time fund it — actually make it a funded commission, with staff.  And that died in Senate Business Affairs, with Susan’s help.

VOGT:  Do you think they’ll try to bring this back again?

GAGLIARDI:  Absolutely!

VOGT:  Yeah.

GAGLIARDI:  Absolutely.  And should — to be quite honest, should the Republicans lose control of the Senate, this would be one of the first things that get passed.

VOGT:  Now, Tony or Susan, do either of you all know what the financial impact was?  What– how –you know, what kind of taxes we’ll be paying?  What was the cost of this commission?

GAGLIARDI:  Well, the commission was not funded.

VOGT:  Okay.

GAGLIARDI:  It was a voluntary commission.  And in fact, it’s interesting to note, — Patty Kurgan shared this in her testimony –that the chairman of the commission had written several books on this issue, and herself, in several of her writings, disputed the fact that there was such a large pay gap. But that was never discussed in these commission meetings.  In fact, our business representative was told to sit down and shut up.

VOGT:  Oh!

MUNSON:  Yeah, it is absolutely stunning what goes through there. They were not very nice to Patty, as I recall, and it’s interesting that they seem to speak out of both sides of their mouth.

GAGLIARDI:  Mm-hmm. Yeah, it was [inaudible]–.

VOGT:  Well, it just seems hard to think that they don’t have –that didn’t have money in it, because I’m kind of reading, you know, here are the recommendations, and it had create the Colorado Department of Labor and Employment staff, and create the Pay Equity Commission, and monitor and measure the progress, and create a media campaign, and recognition and certification program–.


VOGT:  I mean, with all of this, I’m amazed they did that without any funding.

KOCHEVAR:  Well, and this report –they didn’t turn this report in until the day that they were trying to save that commission.

GAGLIARDI: To save that commission.  You’re right.  Yep

VOGT:  Hmmm.

KOCHEVAR:  Mm-hmm.

MUNSON:  Tony – Kim, here.  I can hear —  I just — there’s many government officials and bureaucrats that think that they create jobs.  [laughing]  And I guess, in a way, they are creating a job, here.   However, who pays for it? Who pays for it is all of us taxpayers, and that is not start real job creation.  That’s faux job creation.

GAGLIARDI:  You are so right.  You know, I mean, I love to — when I get these lectures. I will get lectured in several committees over in the Capitol about, “Well, government is creating the this number of jobs,” and that.  And you know, maybe as I get older I get a little more outspoken. But government does not create jobs.  Business creates jobs.  Government is to provide infrastructure, and they can’t do that unless you have a thriving business community. And right now, it’s especially at the national level with these runaway federal agencies–and even some of the state agencies– they are doing everything to inhibit business thriving, and all that.  And the cost of that comes right back to the business owners–.

KOCHEVAR:  Mm-hmm.

GAGLIARDI:  [We] don’t hire, we don’t expand, and we don’t reinvest.

MUNSON:  Well, ultimately, you’re going to get to the point, as Maggie Thatcher says, with Socialism – because this is moving toward Socialism.  And that is, eventually you’ll run out of everybody else’s money.

GAGLIARDI:  That’s right.

MUNSON:  And what’s been interesting to me, Tony, is that some of the kids coming out of college have this idea that they are owed a good paying job.  But they don’t quite understand that it is creativity, innovation, it’s the private sector that creates those jobs.  And if they can’t find that great job that they want then perhaps they should go out in and try create a job create a business.  But it is astounding to me the kids are getting out of college not understanding that.

GAGLIARDI:  The entitlement mentality of college graduates today –and Susan and I make have talked about this.  They come in.  They think they’re going – they ought to be started at the top of the pay scale. They think they ought to have the corner office. And — they really do.   The mentality – the entitlement mentality is unbelievable.  And you know who’s to blame for a lot of that? [It] is government.

MUNSON:  I totally agree.

VOGT:  Right.  Now, we’ve only got one minute left, Tony.  Real quick, for the National Federation of Independent Businesses, [is there] anyone that you do recommend that is running for president right now that will be good to businesses and allow us to grow and prosper?

GAGLIARDI:  Not at this point.  NFIB, in our 75 years, has not taken a position in a presidential election. It’s one –It’s the only race we do not take a position in.

VOGT:  Okay.  So, just make sure that we’re–

GAGLIARDI:  I have my favorite but I can’t say.

VOGT:  Okay, so we just want to make sure that we’re putting somebody into place to make sure they understand that small business is actually employ the majority of the people in this country.

GAGLIARDI:  Well, small business employs over three-quarters of our workforce.

VOGT:  Yep, exactly.  Exactly.  So we’ve got to make sure that they can continue to thrive and make sure that small businesses can still afford to make products at prices that people are still willing to lineup and pay and trade their hard-earned money for.  So, thank you so much for your time, today, Tony Gagliardi with NFIB and Susan Kochevar with CRBC.  Thank you.

GAGLIARDI:  Thank you so much.

VOGT:  Stick with us. We’ll be right back after this break


VOGT:  […] But, real quick, Diana has called back in, so we want to make sure we get back to her on this.

MUNSON:  Perfect!

VOGT:  But we were talking about pay equity. So, Diana, welcome back.

CALLER DIANA:  Thank you.  Thank you.

VOGT:  Yeah. Thanks for calling back.  I think it’s interesting what you said.  I had written a piece on the Lilly Ledbetter Act a couple of years ago, because she was coming out saying, “Oh, women were being paid too littlem” and she had been working for a company for – gosh, I don’t know –20, 30 years and didn’t realize until the year that she retired she was making less than the men.  So at that point she was going to go back and do something and sue them,  instead of saying, “Wow!  Gosh, that was my fault.  I probably should’ve been checking in every year, sitting down with my manager and saying, ‘Here’s my value. Here’s what I bring to the table.  Here’s what I’ve done.  And here’s what I would like to get paid. Let’s talk about a raise.’”  So I would almost be too embarrassed to admit that I went back along with the same company without asking that, and trying to negotiate a higher salary for me.  Maybe in not negotiate a higher salary, you’re admitting you don’t think you bring that much value to the table.  […] We were talking about the Pay Equity commission, and Diana, you mentioned a good point that it would be great for the private market to start to teach people how to negotiate for a higher salary. I think that’s a great idea.  Please continue on with that.

CALLER DIANA:  Hmm.  Well, as I say, I think that there are an awful lot of organizations out there that are helping women many different ways. But one organization I actually have been volunteering with, has me in a situation where I am mentoring one of their participants. And, I have to say, it has probably been more rewarding for me than it has been for her.  But they have managed to recruit quite a few women from the community who are willing to mentor their female participants.  And we do help them preparing their resumes, they even went to a mock interview process.  A lot of good things.  It’s woman-to-woman, where we discuss things we are all concerned about.  And that is having the confidence, understanding what value you have, and what values you want to develop, and being able to sell those. And, uh, as I say, it’s — I guess my concern is when we try to look at this from a government perspective, how could you possibly think something so full of nuance and somehow codify it, and make certain rules apply to everyone.  We read an article about a woman who, after she lost a suit about pay equity in her previous position, she was then in a position as a CEO, and decided that in her company she was going to ban negotiating entirely.  And so, whatever offer you got was where it stopped.  And, um, — because she felt like she wanted to even the playing field and make sure that men and women didn’t suffer because they may have different negotiating styles.  And that just seems crazy to me.  On the other hand, she is free to do that, and her employees are free to leave if they don’t like that.

MUNSON:  Well, that’s exactly right.  Diana, if you really think about it, human nature is such that people like to keep money in their pocket, whether or not you’re an employer or an employee.  And so let’s say you have an employer who is able to get a very high qualified individual at 20% less cost, across the board.  Wouldn’t that business owner hire—you know, have their team made up of the very qualified people that they’re paying less – that make them more competitive in the market over somebody that, say, you know, is implying that they only want men, and they’re paying 20% more – that business is eventually going to go out of business. I mean, it’s antithetical to common sense and to real business practices, this whole pay equity commission.

VOGT:  Yeah, but also, I think, at the same time, you know, when – several different businesses are going to compete with each other for great employees.  And you want to make sure that you’re attracting and retaining quality employees.  If you want the best of the best, and you get to the point where, “You know what? I need to be able to pay these guys for what I want them to do, because not everybody can do the job, then I’m going to make sure that I’ve got an extra benefit, or I’m giving an extra vacation day, or I’m going to pay a little bit more, or something here or there.”  And so it’s great for you, as the business owner, to be able to decide that.  Sure, when you are starting out in the business world and you don’t have a lot of qualities, and you’re not bringing a lot of value to the table, you’re going to go work for the small company that can’t pay a lot, and you’re going to make peanuts.  But you’re going to do it in order to gain the skills to move on and hopefully move up someday, now that you’re worth more money. It’s a great thing that businesses are allowed to think about that and getting to negotiate their own salaries.

KOCHEVAR:  Right.  Well, I think it would help a lot if people – individuals—started to think of themselves as their own individual business, even if you work for somebody else.  You want to build your own inventory, build your own skills.  And then you farm out those skills and trade them for pay. So, if you looked at yourself as your own business and realize, when you’re working for someone else you’re essentially just contracting them to take care of all your taxes and your payroll and stuff.  I mean, there is – you do get value out of that. Otherwise, you’re paying that yourself, as your own small business.

MUNSON: [inaudible]

VOGT:  Yeah.  Choice is a value.

MUNSON:  Now, we always like to leave with some thought.  And there is an excellent book out there by –edited by Lawrence Reed at Foundation for Economic Education.  It is called “Excuse Me, Professor”. And in this, I wanted to take a look at–it says, “Free Markets Exploit Women” by Anne Rathbone Bradley.  But in her summary, this is what she said:  “The freer the market, the more opportunities there are for women and anyone else, for that matter, to progress up the economic ladder.  Most of the 17.9% wage gap in the United States can be explained by number of hours worked, marriage, and age. Women who work full-time and have never married make 95.2% of male earnings, narrowing the gender wage gap to less than 5%.  And for those women who want to work many paid hours and invest highly in education, there are more income opportunities in the highest quintile’s there than have ever been before. So, in essence, I think that we would make sure that the free market is answering the question versus government coming in with a heavy hand to tell us what we need to do.  And Susan, it’s not just with this Pay Equity Commission but it’s also across the board.  So, Susan Kochevar, thank you so much for being our guest chick, today.  And we really appreciate it, so thank you so much.

VOGT:  Everybody stick with us.  In the second hour, we’re going to be with Jim Wigley, talking about energy, oil, gas, fracking, all that kind of stuff that you need to know.