Washington is the latest state to pass additional pay equity protections. One year after enacting the 2018 Equal Pay and Opportunity Act, which included an array of enhanced pay equity provisions, the legislature passed HB 1696, which restricts pay history inquires and enhances pay transparency requirements. The bill passed on a near party-line vote. Governor Jay Inslee is expected to sign the legislation, which would go into effect 90 days later.

Pay History

Washington will be the eighth state to ban all public and private employers from (1) seeking the wage or salary history from an applicant or the applicant’s current or former employer; or (2) relying on prior wage or salary history to set pay.

Pay Transparency

HB 1696 also includes a requirement that after an employment offer has been made, employers (with at least fifteen employees), upon request, provide the minimum wage or salary for the applicant’s new position. Additionally, if requested, employers must provide wage scale or salary ranges for internally transferred employees.

Finally, when no wage or salary range exists, employers must provide the minimum wage or salary expectation prior to posting the position, making the position transfer, or making the promotion.

What Should Employers Do?

Employers, if they have not already done so, should consider removing salary history questions from employment application materials and train all recruiters to comply with state and local bans regarding salary history.

Our Pay Equity Resource Group will continue to report on this and other pay equity laws as they develop.

It’s here and it’s real.  The written order memorializing Judge Chutkan’s oral Order setting the September 30, 2019 deadline for collection of employer pay data reveals these additional details:

  • EEOC is ordered to collect EEO-1 Component 2 pay data for calendar years 2017 and 2018

Please find the full article in our Affirmative Action & OFCCP Law Advisor blog here.

Judge Tanya S. Chutkan has ordered initial compliance with the EEO-1 pay data reporting obligation by September 30, 2019.

As we previously reported, the EEOC has informed the court it could complete collection of data by September 30th by utilizing the services of a third party vendor, though there would be quality and integrity concerns.  As proposed, the data collection would begin July 15th.

Please find the full article in our Affirmative Action & OFCCP Law Advisor blog here.

Colorado legislators are only a few steps away from approving the Colorado “Equal Pay for Equal Work Act” (SB 19-085) and making Colorado the latest state to enact enhanced equal pay legislation.

Colorado’s 2019 Equal Pay Law, as originally introduced in January, would likely have been the most aggressive equal pay law in the nation. While the current bill would still be among the most stringent, hearings held on the law in February resulted in a number of employer-friendly amendments. Prominent among these changes was the addition of several defenses now available to employers to explain pay differences between employees such as geographic location, training, education, and travel.

During recent debate in the Colorado Senate, Republicans offered an amendment that would have removed the private right of action and kept enforcement of state equal pay violations with the Colorado Department of Labor and Employment. The amendment failed (16-19) along party lines, and no substantive changes have been made since the proposed law cleared committees in late-February. The Colorado Senate approved the final bill 20-14, with two Republicans joining 18 Democrats.

It is now a race against time for the bill to pass, as the Colorado Legislature is set to adjourn on May 3. SB 19-085 is scheduled for a hearing in the House Business Affairs and Labor Committee before moving to the House Floor for a final vote. Democrats (all expected to vote in favor of the law) hold a 41-24 advantage in the Colorado House. If the bill moves forward unchanged, it would then head to Governor Jared Polis, who is likely to sign it. However, if the House amends the bill, its fate becomes more questionable as it would have to return for re-passage by the Senate with only a few days left in the legislative session or be re-introduced at the beginning of 2020.

We will continue to monitor and report on this any other developments in equal pay laws.

It appears employers will need to wait a bit longer to learn when they will be required to file their EEO-1 pay data.

In an order filed April 11, Judge Tanya S. Chutkan set a hearing for 2:00 p.m. Eastern on April 16, 2019 for the parties to present their cases regarding the government’s compliance with her order to reinstate the EEO-1 pay data reporting obligation.

Please find the rest of this article on our Affirmative Action & OFCCP Law Advisor blog here.

In a status update filed April 3, 2019, the government informed the court that EEOC could complete collection of the required EEO-1 Component 2 pay data by September 30, 2019, but only if it utilized a third party data collector to do so.

The update was filed in response to Judge Tanya S. Chutkan’s request that the government provide the court with its plan to comply with her March 4, 2019 ruling that over-turned the stay on the pay data reporting obligation.

Please find the rest of this article on our Affirmative Action & OFCCP Law Advisor.

Democrats in the U.S. House of Representatives continue to call for stronger protections to combat wage inequality. By a vote of 242-187, the House recently passed the Paycheck Fairness Act to enhance the federal protections guaranteed under the EPA.

Currently, to defend against an EPA claim, an employer can assert any of four defenses to justify paying men and women differently for the same work. Employers can pay workers at different rates if the wage differential is based on i) seniority, ii) merit, iii) quantity or quality of the employee’s work, or iv) any factor other than sex (sometimes referred to as a “catchall defense”).

The Paycheck Fairness Act, H.R. 7, amends the applicability of the last exception by requiring wage differentials to be based on a “bona fide factor other than sex, such as education, training or experience.” This “bona fide factor defense” would require employers to prove that wage differentials fully account for the “entire differential in compensation,” actually relate to the job and are consistent with business necessity, and are not based on or derived from existing gender-based wage disparities.

H.R. 7 also would afford enhanced anti-retaliation protections for employees who not only file pay discrimination claims, but who discuss their salaries with coworkers or initiate or participate in pay equity investigations and hearings. However, employers are not liable under H.R. 7 if an employee with access to wage information, as part of their essential job functions, discloses such information to other employees, unless the employee disclosed the information as part of a complaint or employer-directed investigation.

H.R. 7 would establish the Secretary of Labor’s National Award for Pay Equity in the Workplace to recognize employers for excellence in pay practices. Employers can also receive assistance in instituting compliance checks and modifying their equal pay practices. Lastly, H.R. 7 creates a grant program that would provide funds to eligible entities to design negotiation skills training programs for women and girls.

Support for the measure was divided largely along party lines. House Republicans criticized the bill as “designed for trial lawyers” and pushed to add language limiting attorney’s fees. Under H.R. 7, violators can be subject to enhanced penalties, such as compensatory and punitive damages.

In light of the political composition of the Senate, this bill is unlikely to gain the support needed to be enacted.

This is not the first time this bill has surfaced. Previous efforts to pass the Paycheck Fairness Act failed in the Senate in 2009 after passing in the House of Representatives.

States also continue to pass new fair pay laws.

Our Jackson Lewis Pay Equity Resource Group will continue to monitor these developments and provide guidance on compliance.

 

 

On April 2, Equal Pay Day, Maine’s House and Senate passed a bill prohibiting employers from asking about a potential worker’s wage history before making a job offer. L.D. 278 passed the Maine House by a vote of 86-54 after clearing the Maine Senate by a vote of 22-11 earlier in the day.

If Governor Janet Mills, a Democrat, signs the bill into law, it will go into effect immediately, and Maine will become the 14th state in the nation to prohibit employers from making pre-offer inquiries into an applicant’s compensation history.

Prohibitions

The bill would bar an employer from inquiring about compensation history unless it has negotiated and made an offer to the prospective employee that includes all terms of compensation. The employer may not make such inquiries of the prospective employee or of the employee’s current or former employer.

The bill also clarifies that the state’s existing pay transparency law prohibits employers from stopping employees from discussing or disclosing their own or another employee’s wages.

Evidence of Discrimination

Maine specifically identifies an employer’s direct or indirect inquiry into an applicant’s pay history as evidence of unlawful employment discrimination. It is the first state to do so.

Permitted Practices

The bill allows the following:

  • Employers or employment agencies may “seek compensation history of an employee or prospective employee after an offer of employment that includes all terms of compensation that has been negotiated and made to the prospective employee”
  • Employers may confirm a prospective employee’s compensation history if that compensation history was voluntarily disclosed, without prompting

Further, the law is inapplicable to an employer who makes a compensation inquiry based upon any state or federal law that requires disclosure or verification of compensation history.

Next

Governor Janet Mills is expected to sign L.D. 278. Once signed, the law will go into effect immediately. Employers should review and revise their job applications and policies and procedures and consider training personnel about the ban.

The U.S. District Court hearing the EEO-1 pay data reporting case has ordered EEOC to inform employers by April 3, 2019, whether they will be required to provide pay and hours worked data for the 2018 EEO-1 reporting cycle. The current deadline for 2018 EEO-1 reporting is May 31, 2019.

As we reported on March 5, 2019, the U.S. District Court for the District of Columbia vacated the Office of Management and Budget’s (OMB) stay of the EEOC’s pay data collection tool and ordered the OMB’s previous approval of the revised EEO-1 form to be in effect. National Women’s Law Ctr. V. OMB, No. 17-2458 (D.D.C. Mar. 4, 2019). In the wake of the court’s decision, employers were left to question the impact of the ruling, including whether the EEOC would require submission of the pay data by the May 31st reporting deadline or extend the deadline. The pay data reporting requirements would impact all employers, including federal contractors, with 100 or more employees.

On March 18, the EEOC opened the online portal for filing EEO-1 report workforce demographic (Component 1) data and issued the following statement regarding the pay data reporting requirement:

As it announced on February 1, the EEOC is opening its EEO-1 online portal to receive 2018 EEO-1 Component 1 data starting March 18, 2019, and ending May 31, 2019. . . . The EEOC is working diligently on next steps in the wake of the court’s order in National Women’s Law Center, et al., v. Office of Management and Budget, et al., Civil Action No. 17-cv-2458 (TSC), which vacated the OMB stay on collection of Component 2 EEO-1 pay data. The EEOC will provide further information as soon as possible.

The portal for submission of the 2018 EEO-1 Component 1 data is linked here.

EEOC’s March 18 statement provided little guidance as to what steps the agency may take in response to the court ruling, leading the plaintiffs in the underlying lawsuit to request a court conference to obtain information about how EEOC intended to proceed. Following a conference on March 19th, the court ordered EEOC to inform employers by April 3rd of the agency’s timeline for the pay data collection.

Our Jackson Lewis Pay Equity Resource Group will continue to monitor these developments and provide guidance on compliance.

The Jackson Lewis Pay Equity Resource Group is pleased to announce a special series to help employers prepare for Equal Pay Day. “Rethinking Pay Equity” will take a look at several of the biggest questions facing employers in the ever-evolving #equalpay landscape, including: How can prior salary information perpetuate the persistent pay gap, and how should we measure and address the impact of years-long reliance on such information in the hiring process? What data should we use when reviewing pay? Who should be compared against whom? What do we do if pay analyses reveal a problem? Should the company voluntarily make public disclosures about pay?

Our four-part series will be published over the next few weeks, culminating with a unique webinar presented by Jackson Lewis Pay Equity Resource Group Co-Chairs Joy Chin and Stephanie Lewis on April 2, 2019.

April 2, 2019, is Equal Pay Day. The date, which changes each year, is meant to represent how far into 2019 a woman, on average, must work to earn what a man earned in 2018.

These days, employers face greater challenges around pay than they have for decades. The country has seen a surge in new equal pay legislation and legal theories about pay discrimination, one that is being fueled by the #MeToo movement and growing calls for gender equality. The result is a whole new set of rules, obligations, and best practices around compensation for employers.

Join us in the lead up to Equal Pay Day 2019 with “Rethinking Pay Equity,” a special series of legal alerts aimed at assisting employers by addressing the hottest topics and trends in the world of equal pay. The first alert — “Overcoming the Impact of Prior Salary Information” — is available now.

Also, be sure to register for our important webinar on April 2. Registration is complimentary, but space is limited, so please do not delay.