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President Obama Signs Executive Orders Targeting Equal Pay

April 30, 2014

Stymied by Congress, President Obama has been using his rulemaking authority to address wage issues, the latest of which is equal pay for women and minorities.  On April 8, 2014, President Obama signed two documents, an Executive Order and a Presidential Memorandum, dealing with equal pay issues.  These documents implement by regulation provisions of the proposed Paycheck Fairness Act, which has been rejected by Congress on multiple occasions.

The Executive Order amends Executive Order 11246, which prohibits discrimination by government contractors and subcontractors on the basis of race, color, religion, sex, or national origin, and requires affirmative action to ensure equal opportunity in employment.  The new Order prohibits government contractors from retaliating against employees and applicants who asked about, discussed or disclosed their own or others’ salary information.  The intended purpose of this Order is to enhance the ability of contractors and their employees to identify and remedy compensation discrimination.  The Secretary of Labor is directed to issue proposed regulations implementing the Order within 160 days.

The Presidential Memorandum directs the Secretary of Labor to issue, within 120 days, new regulations requiring government contractors to submit summary compensation data, including information about race and sex.  The Department of Labor will then use the data to encourage voluntary compliance by contractors with equal pay laws and to identify and analyze trends by industry.  The DOL is also directed to target enforcement efforts as to entities where the data suggests pay discrepancies.  Interestingly, this Presidential Memorandum appears to resurrect the Equal Opportunity Survey, which was used by the Office of Federal Contract Compliance Programs from 2000-2005 to collect personnel data, including compensation information, from federal contractors.  The EO Survey was abandoned in 2006, after an independent consulting group found that it was ineffective in identifying systemic discrimination.