DOL Proposes Rule That Would Require Federal Contractors to Submit Pay Data

by Goodwin

On August 6, 2014, the U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) announced a proposed rule that would require certain federal contractors to submit annual equal pay reports providing summary data on their employee compensation.

Under the proposed rule, which is open for public comment until November 6, 2014, companies that file EEO-1 reports with the federal government, have more than 100 employees, and hold a federal contract, subcontract, or purchase order amounting to $50,000 or more, are required to submit summary pay data on their workforces annually to the OFCCP. The data contained in the so-called Equal Pay Report must be provided by race and sex and must include job category, hours worked (either actual hours worked for hourly workers or default figures for salaried workers), and number of employees. A fact sheet released by the OFCCP explains that Equal Pay Reports would not be required to include individual employee pay data or information on factors such as education or work experience that may affect compensation.

The OFCCP proposes to aggregate each contractor’s summary data from the Equal Pay Reports with those of peer employers by industry to construct an objective industry compensation standard. The OFCCP intends to compare each contractor’s summary data with the industry standard, release the comparison, and afterward direct its enforcement resources toward those contractors whose comparisons are suggestive of sex or race discrimination in pay.

The OFCCP has established the calendar year as the applicable reporting period and set March 31 of each year as the filing deadline for the prior year. Covered companies will be able to file electronically and compile the Equal Pay Report using the same data that is used to report W-2 earnings to the Internal Revenue Service.

Early commentators have questioned the utility of the proposed rule, arguing that the Equal Pay Reports will fail to produce meaningful conclusions about pay discrimination given the level of data aggregation to be undertaken by the OFCCP and the myriad of factors that may affect compensation but are not reported. The OFCCP has made clear, however, that the proposed rule is “one component of a larger strategy to address the reality that, despite five decades of extraordinary legal and social progress, working women still earn only 77 cents for every dollar that working men earn” — a gap that is “even greater” when accounting for African American women and Latinas.

The OFCCP’s proposed rule is the latest instance in a series of executive actions taken by the Obama Administration under the authority of Executive Order 11246, which requires federal contractors and subcontractors to take affirmative action to attract and retain qualified minorities, females, covered veterans and the disabled. Just last month, on July 21, 2014, President Obama signed Executive Order 13672, which amended Executive Order 11246 to include nondiscrimination based on sexual orientation and gender identity. And in September of last year, the OFCCP released sweeping changes to its regulations requiring certain federal contracts and subcontractors to engage in affirmative action for veterans and disabled individuals. For more information on these changes, please see our previous client alert.

Though the proposed rule is subject to change before being promulgated in its final form, it would be prudent for covered companies to proactively assess pay data and be prepared to distinguish any compensation differences that that are explained by legitimate factors such as seniority, job duties, and skill sets.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Goodwin | Attorney Advertising

Written by:


Goodwin on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.