First, he signed an Executive Order banning federal contractors from retaliating against employees who discuss their compensation. This ban is similar to the protection offered to employees under the National Labor Relations Act (NLRA).
Second, he issued a Presidential Memorandum requiring federal contractors to submit summary data to the Department of Labor (DOL) on compensation paid to their employees, including data by sex and race. The DOL will then use the collected data to encourage voluntary compliance with equal pay laws.
So what do the orders mean for your business?
Even if you’re not a federal contractor, this is a good reminder that employers still need to allow their workers to discuss salaries with their fellow coworkers under the National Labor Relations Act. However, employers can limit the discussion to people inside the company, and may be able to prohibit employees from discussing salaries when they should be working.
Although the president’s order only applies to federal contractors, women or men who believe they’re getting unequal pay because of their gender, even if they’re performing the same job, can still take action under the Equal Pay Act.
So while non-federal contractors technically don’t have to comply with President Obama’s executive orders on wages, there are other laws in place that affect private employers. If you’re confused about how the law applies to your business, it’s wise to consult an experienced employment lawyer to get your questions answered.
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