The Office of Personnel Management (OPM) announced a new regulation and a proposed rule on Jan. 29 that will prohibit the use of salary history for federal employees and federal contractors.
The regulation prevents the use of salary history when considering pay for individuals seeking federal employment. The OPM is not banning employers from considering prior federal salary when setting pay but is requiring agencies to establish policies that further promote equity in pay-setting.
The OPM’s proposed rule would prohibit federal contractors from seeking and considering past compensation information when they make their employment decisions. It would also require that contractors disclose their salary ranges in new job postings.
Federal Government Makes Moves to Boost Pay Transparency
SHRM | Jan 2024
Proposed rule and Comment Instructions
Comment deadline: 4/1/24
Law Firm Articles
Review Current Requirements Under Federal and State Law. You should note that just about every state in the country has passed legislation to complement the federal Equal Pay Act, which mandates equal pay for equal work. Under federal law, employees must be compensated the same when they perform “substantially equal” work in the same “establishment” on jobs requiring equal skill, effort, and responsibility, and performed under similar working conditions. Equality in pay includes all forms of compensation, including base salary or wages, overtime, bonuses, benefits, and any other perks or remuneration.
Federal Contractors Would Need to Display Salary Ranges Under Proposed Pay Transparency Rule
Fisher Phillips | Feb 2024
Briefly summarized, this proposed rule would prohibit contractors and subcontractors from seeking and considering information about job applicants’ compensation history when making employment decisions for certain positions. In addition, contractors and subcontractors would be required to disclose the compensation being offered to the hired applicant in job announcements for certain positions.
New Federal Proposed Rule Addressing “Pay Equity and Transparency in Federal Contracting”
Woods Rogers | Feb 2024
Given that many federal government contractors also have commercial business lines, too, the impact of the proposed Salary Rule, if promulgated, could potentially be far-reaching. That is especially the case because the definition of “work on or in connection with the contract” is broad, because the rule is intended to apply to commercial contracts, and because it would also apply to small contracts.
Déjà Vu for Federal Contractors with Salary History Ban?
Bradley Arant | Feb 2024
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