President Obama Set to Put In Place New Gender Wage-Gap Rules

Last Friday, President Obama announced his plan to put in place new rules aimed at reducing pay inequality between men and women. When the rules go into effect later this year, they will require companies with more than 100 employees to submit data regarding salaries by race, gender, and ethnicity.

“Women are not getting the fair shot that we believe every single American deserves,” the
President remarked when making the announcement. The new rules are an expansion of protections put in place by the first law President Obama signed when taking office over seven years ago, the Lilly Ledbetter Fair Pay Restoration Act. “Social change never happens overnight,” he said. “It is a slog and there are times when you just have to chip away and chip away. … It’s reliant on all of us to keep pushing

Obama Lilly Ledbetter Signing
President Obama signs the Lilly Ledbetter Fair Pay Restoration Act

that boulder up the hill.”

Pay discrimination is already illegal under both federal and state law. In Connecticut, it is illegal for employers to discriminate against employees in compensation based on any protected class status, including sex and race. The real issue for both employees and the CHRO in enforcing these laws is in data collection. Even when the information is collected, employers rarely disclose salary data voluntarily so it can be difficult for any one employee to know when they are being paid less than others outside their protected class. The President’s new rules should help to rectify that problem by requiring that data’s disclosure.

While the rules are not yet finalized, Connecticut employers with over 100 employees may want to consider putting in place salary data collection policies now so that they will be ready to comply with the new rules when they take effect.