In February this year, draft gender pay gap reporting regulations were published and comments were invited. There then followed an extended period while we waited for the final regulations to be published and the (many) consultation questions to be addressed. One could speculate about the chaos caused by Brexit [in Parliament] that caused this extended waiting period, but we won’t. The main thing is that the final regulations are at last here and (subject to parliamentary approval) will come into force on April 6, 2017. READ MORE
As predictions abound regarding what a Trump presidency will mean for employers, including which laws and regulations might be amended, scaled back, or repealed all together, the issue of pay equity is likely here to stay. Over the past year, numerous states – including several with Republican governors – have enacted aggressive equal pay legislation, following California’s lead in 2015. Additionally, activist shareholder groups continue to exert pressure by filing proposals that, if passed, require companies to disclose publicly the percentage “pay gap” between male and female employees, and planned steps to address it. And while pay equity is not at the top of Trump’s political agenda, his daughter Ivanka has been an equal pay advocate, perhaps signaling that the EEOC’s final rule requiring employers with more than 100 employees to report W-2 pay data to the federal government through new EEO-1 reporting requirements may not be on the Trump chopping block. Accordingly, smart employers will stay the course on equal pay, including by following these recommendations:
On October 6, 2016, the coalition committee of the German government parties agreed on the planned Equal Pay Act (Entgeltgleichheitsgesetz). We described the first draft of the Equal Pay Act submitted by the German Federal Ministry for Family Affairs, Senior Citizens, Women and Youth in our blog post earlier this year.
Just less than a year ago, California adopted the Fair Pay Act (“FPA”), which took effect on January 1, 2016 and created some of the strongest equal pay protections in the nation. On September 30, 2016, Governor Jerry Brown signed two bills that expand the law even further.
Yesterday, the EEOC announced that it had finalized a regulation that will increase disclosure requirements regarding employee compensation for thousands of businesses. The new rule, which we’ve blogged about previously, requires all businesses with 100 or more workers to submit pay data by gender, race and ethnicity on their EEO-1 forms. Specifically, employers will now need to provide:
The Government Accounting Office recently released a report on the DOL’s Office of Federal Contract Compliance Programs (OFCCP). The report notes several concerns related to the Agency’s contractor selection process, investigator training and compliance assistance efforts. Further, the report details many of the concerns voiced by contractors regarding inconsistency in investigations and contractors’ overall distrust of the Agency in compliance assistance efforts. OFCCP received a draft of the report and, in its response to the draft report, agreed with some of the recommendations related to changes in the selection process and better monitoring of contactors for AAP compliance. Further, the Agency noted its efforts to improve training and compliance assistance.
In an emerging trend, law firms have found themselves the targets of recent lawsuits alleging gender discrimination against female partners. Most recently, Kerrie Campbell, a litigation partner at Chadbourne & Parke’s Washington, D.C. office filed a $100 million proposed class action lawsuit on behalf of all female partners at the firm. She alleges that Chadbourne’s male-dominated culture leads to unequal compensation for women. The lawsuit, filed on August 31, 2016, in federal district court in New York, seeks relief under Title VII, the Federal Equal Pay Act, and the District of Columbia Human Rights Act.
New York City Public Advocate Letitia James has introduced before the New York City Council an amendment to the New York City Human Rights Law, which, if enacted, would prohibit employers from requesting or relying upon the salary history of an prospective employee in making starting salary and other pay decisions. In the bill summary, Public Advocate James and her co-sponsors conclude that when employers rely upon historical salary information, “they perpetuate the gender wage gap” and suggest that this legislation would “help break the cycle of gender pay inequity.” New York City’s proposed legislation follows closely on the heels of a wide-reaching pay equity statute recently enacted in Massachusetts that includes a prohibition on employers requesting or requiring applicants to provide their salary history.
Orrick partner Lauri Damrell collaborated with California Labor Commissioner Julie Su on a recent Op Ed column for the San Jose Mercury News outlining their joint efforts in California to address the gender pay gap. Damrell and Su are both members of the California Commission on the Status of Women and Girls, and their column discussed their recent launch of the California Pay Equity Task Force to encourage more collaboration between employers and employees in finding solutions to the high-profile issue.
On August 1, 2016, Governor Charlie Baker signed into law a pay equity bill which the Massachusetts Legislature passed by unanimous vote on July 23, 2016. The pay equity act is one of the strongest and most unique in the nation. Chief among the unique features is the prohibition on the use of prior salary in setting compensation and an affirmative defense for employers who conduct pay audits. The legislation differs from the federal Equal Pay Act (EPA) and other recent state pay equity laws, including California and Maryland, in several ways.
Comparable Work Presents a Broader Standard
The EPA requires that men and women in the same workplace receive equal pay for “equal work.” “Equal work” means their jobs need not be identical, but “substantially equal.” The newly passed Massachusetts legislation only requires “comparable work,” meaning work that is substantially similar in that it requires substantially similar skill, effort and responsibility and is performed under similar working conditions. Thus, the legislation will give employees a larger pool of “comparator jobs” to point to should they feel underpaid in relation to their gender opposites. In fact, the “comparable work” standard appears to be similar to the broader-based standard used in pay-disparity claims under Title VII, except that Title VII also requires proof of intent. Recent Maryland and California laws also expand the pool of comparators. READ MORE