As the 2022 NILG National Conference was coming to a close, the EEOC released the long-awaited National Academy of Sciences report on the EEOC’s Pay Data Collection Completed in 2020. The study, titled Evaluation of Compensation Data Collected Through the EEO-1 Form, is a dense read at over 275 pages. The report found however, that the process of collection, as well as the actual data to be collected had flaws. The report also recommends the EEOC embark in a trial to field test the process if it decides to roll out a nationwide data collection tool. Read more.
Illinois Governor J.B. Pritzker has signed into law an amendment to the Illinois Equal Pay Act (IEPA) requiring companies with 100 or more employees in Illinois to obtain an equal pay registration certificate from the Illinois Department of Labor (IDOL).
Previously, only companies with more than 100 employees were required to complete the IEPA registration certification. Read more.
The New York City Council has pushed back implementation of the salary transparency law from May 15, 2022, to November 1, 2022.
On January 15, 2022, New York City enacted legislation requiring all covered employers to include a minimum and maximum salary for the position advertised. The new law was set to go into effect on May 15, 2022. However, following the City Council’s passage of an amendment to the law, assuming the mayor signs it, the effective date will be November 1, 2022. Read more.
Mississippi Governor, Tate Reeves, had three options. He could have vetoed the state’s pending pay equity bill. He did not.
He could have let it come into effect without action. He passed on this path too.
Instead, on April 20, Governor Reeves signed the bill into law. And now every state in the nation has a law prohibiting pay discrimination in some form.
Mississippi’s new law prohibits employers from paying “an employee a wage at a rate less than the rate at which an employee of the opposite sex in the same establishment is paid for equal work on a job, the performance of which requires equal skill, education, effort and responsibility, and which is performed under similar working conditions.”
Like similar laws from many jurisdictions (including at the federal level), Mississippi exempts pay differences “pursuant to differential based on:
(a) A seniority system;
(b) A merit system;
(c) A system which measures earnings by quantity or quality of production; or
(d) Any other factor other than sex.”
The law mirrors the requirements of the federal Equal Pay Act of 1964. But it differs most notably from the recent trend in pay equity laws by including the catchall “any other factor other than sex.” Most recent state and federal laws have limited this catchall.
Mississippi’s new law also differs from many other state (and perhaps federal) pay laws in that:
- It is solely focused on gender, without reference to race-based pay differences;
- It expressly permits an employer to rely on (a) an employee’s salary history, (b) the continuity of an employee’s employment, (c) market competition for an employee’s services, (d) employee attempts to negotiate wages, and similar explanations, as “any other factor other than sex;”
- It does not prohibit employers from inquiring about salary history; and
- It does not require pay transparency for applicants or employees.
This new law goes into effect July 1, 2022.
Mississippi is the only state in the country without an equal pay law. That may change soon.
On March 30, 2022, the Mississippi House and Senate both passed HB 770. The bill (1) requires employers to pay employees without regard to sex and (2) encourages equal pay for equal work. The bill sits with the state’s governor for signature or veto by April 23. If the governor does not act, HB 770 will become Mississippi law.
Mississippi’s HB 770 largely mirrors the federal Equal Pay Act. It prohibits employers from paying employees in the same establishment, but of opposite sexes, different wage rates if they are performing “equal work on a job, the performance of which requires equal skill, education, effort and responsibility, and which is performed under similar working conditions,” unless the pay difference is “based on” (a) a seniority system, (b) a merit system, (c) a system that measures earnings by quantity or quality of production, (d) or any factor other than sex—just like under the federal Equal Pay Act.
Unlike the trend in many states that limit the reasons for permissible pay differences (like California, Colorado, Illinois, Massachusetts, New Jersey, and Washington), HB 770 makes clear that its “any factor other than sex” defense includes factors such as:
- The salary history demonstrated by the employee as compared to employees of the opposite sex in the same establishment;
- The continuity of employment history demonstrated by the employee as compared to employees of the opposite sex in the same establishment;
- The extent to which there was competition with other employers for the employee’s services as compared to employees of the opposite sex in the same establishment; and
- The extent to which the employee attempted to negotiate for higher wages as compared to employees of the opposite sex in the same establishment.
This bill runs counter to recent trends for other reasons, too:
- Court have looked skeptically at the “any factor other than sex” defense into issues such as the use of salary history (or other business-related defenses that disproportionately tend impact pay for women). This law would endorse them.
- Most recent state and local laws have prohibited requesting or relying on salary history. This law would codify the practice.
- Most recent state (and city) pay equity requirements and proposals include pay transparency requirements, such as wage range disclosures to applicants or employees. This law would be silent on the issue.
Unless the governor vetoes HB 770, the law will take effect July 1, 2022.
The New York City Commission on Human Rights published guidance for the recently enacted Local Law 32 of 2022, which requires salary transparency in job advertisements, effective May 15, 2022. New York City enacted legislation on January 15, 2022, requiring all covered employers to include a minimum and maximum salary for the position advertised. Unfortunately, the legislative language is minimal and vague. Much of the new guidance appears to be parallel to guidance Colorado provided for its salary disclosure law. Colorado is the only other jurisdiction that has issued such a broad salary disclosure law related to advertisements. Read more.
The rise of state pay transparency laws continues, this time with Washington doubling down on its most recent round of pay equity legislation. If new legislation currently on the desk of Governor Inslee becomes law, Washington employers will soon be required to make affirmative compensation-based disclosures to both applicants and employees.
To date, Washington has implemented one of the more moderate approaches to pay transparency. Under the current law, employers with 15 or more employees are required to provide applicants the “minimum wage or salary” for a position, but only after an offer has been made and upon applicant request. Similarly, employers must also provide the “wage scale or salary range” for internal transfers, but only after an internal transfer or promotion has been offered and upon employee request.
Washington is now poised to align itself with the more aggressive pay transparency regimes implemented in places like Colorado and New York City. Under the proposed legislation, Washington employers with 15 or more employees would be required to affirmatively disclose in all job postings a “wage scale or salary range” and a description of “benefits and all other compensation,” regardless of offer status or applicant request. Similarly, employers would also be required to disclose the “wage scale or salary range” for internal transfers.
Similar to many of its counterparts nationwide, the Washington legislation presents a certain level of uncertainty for employers.
The legislation first fails to define the terms “wage scale or salary range” and “benefits and all other compensation,” further compounding the ambiguity by striking a portion of the current law that allows for the provision of a “minimum wage or salary” if no “wage scale or salary range” exists.
It is likely that subsequent guidance will be needed to provide employers with direction on implementation and compliance, much like what we have seen in states like Colorado that have sought to clarify similar ambiguity.
If signed into law, these requirements will go into effect January 1, 2023.
In addition to digesting OFCCP’s release of a new directive on compensation, government contractors may soon see new regulations around inquiries into and the use of prior salary information. In conjunction with Equal Pay Day, President Biden signed a new Executive Order on Advancing Economy, Efficiency, and Effectiveness in Federal Contracting by Promoting Pay Equity and Transparency. Read more.