Last week, California enacted new legislation updating the prohibition on employers inquiring into the salary history of their applicants and the requirement that employers respond to applicants’ requests for the pay scale for positions. This law, enacting Assembly Bill No. 2282, clarifies key provisions in Labor Code section 432.2 regarding employers’ obligations, which were left undefined in the bill that added Section 432.3 to the Labor Code last year. READ MORE
Iceland Moves to Freeze Out Wage Discrimination
On January 1, 2018, Iceland’s amended Equal Pay Standard took effect, the latest in a serious of measures seeking to address the persistence of national gender wage gaps. The law requires employers with 25 or more employees to obtain a government certification every three years verifying a company’s compliance with equal pay requirements. Failure to attain certification exposes employers to liability of up to nearly $500 in penalties per day. Employers with an observed pay differential can comply by raising the salaries of employees to eliminate the differential. READ MORE
Fair Enough? New Equal Pay Legislation Expands California’s Fair Pay Act
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.
Latest California Equal Pay Legislation Targets Race and Ethnicity
As California employers adjust to recent amendments to the state’s Equal Pay Act, additional changes are looming. As we reported here, last year, California adopted the Fair Pay Act, which provides new pay equity provisions related to employees of the opposite sex. Those amendments took effect on January 1, 2016. Now, California lawmakers are setting their sights on pay disparities based on race and ethnicity. On February 16, 2016, California Senator Isadore Hall III (D-South Bay) introduced Senate Bill 1063, known as the Wage Equality Act of 2016 (“SB 1063”), which seeks to expand pay equity requirements beyond sex to include race and ethnicity.
Taking a Page from DOL’s Playbook, EEOC Seeks to Add Pay Data to EEO-1 Reports
In August 2014, the Department of Labor’s Office of Federal Contractor Programs (“OFCCP”) proposed that federal contractors report compensation information on an Equal Pay report. Amid significant contractor comments that OFCCP coordinate with the EEOC to amend the Employer Information Report (“EEO-1”), EEOC did so on January 29, 2016. The EEOC intends to ask the Office of Management and Budget to approve additional data collection that would require most employers to submit aggregate data on pay ranges and hours worked. The EEOC believes that the additional data “will assist [EEOC and OFCCP] in identifying possible pay discrimination and assist employers in promoting equal pay in their workplaces.” However, questions remain whether this data would yield any meaningful analysis of actual pay differences that would assist either agency in uncovering pay discrimination.
OFCCP Rescinds Prior Guidance on Compensation Discrimination Analysis In Favor of a Case-by-Case Approach
Effective February 28, 2013, the Office of Federal Contract Compliance Programs (“OFCCP”) rescinded two 2006 guidance documents concerning how the OFCCP and federal contractors analyze potential pay discrimination. This change came as a response to President Obama’s Equal Pay Task Force, which brought together the federal agencies charged with addressing pay discrimination.
The OFCCP, which is charged with ensuring federal contractors and subcontractors provide equal employment opportunity, concluded that the previous guidance was too rigid and undermining the agency’s efforts to combat discrimination. Several aspects of the now-rescinded guidance fell into disfavor with the OFCCP in its efforts to carry out President Obama’s mandate to step up investigation of systemic compensation discrimination. First, it was required to compare “similarly situated workers,” defined narrowly to include only employees with the same position. Second, it was required to use multiple regression analysis to test for pay disparities, failing to address situations where analysis of a smaller sample size might be more appropriate. Finally, it required anecdotal evidence to establish a systemic compensation violation in addition to statistical evidence. Reasoning that “employment discrimination comes in many forms,” OFCCP found that this specific method of analyzing compensation would not allow OFCCP to detect all forms of pay discrimination. READ MORE