OFCCP Releases Final Rule on Federal Contractor Pay Transparency

On September 11, the Office of Federal Contract Compliance Programs (OFCCP) issued a final rule regarding Executive Order 13665. The Executive Order was signed by President Obama on April 8, 2014, and was designed to increase pay transparency among federal contractor employees and job applicants. The final rule applies to all contractors that are already covered by Executive Order 11246 (the 1965 order by President Lyndon Baines Johnson that established anti-discrimination rules for federal contactors), and will be effective for contracts entered into or modified after January 11, 2016.

The Final Rule specifically states that employees or applicants cannot be discriminated against for discussing, disclosing, or asking about compensation. Information about salary or wage levels, overtime, bonuses, commissions, paid time off, and insurance benefits would all fall under the category of “compensation.”

Coming at the heels of the Lilly Ledbetter Fair Pay Act, the Executive Order was explicitly designed to try to close pay gaps due to gender and race. Employees or applicants who believe they have been discriminated against will be able to file a discrimination complaint with OFCCP.

Notably, the final rule doesn’t apply to employees who have access to compensation information about other employees or applicants in order to perform essential job functions. In other words, a Human Resources employee might still be fired for disclosing information about another employee’s salary without a legitimate business reason to do so.

About The Boon Group

The Boon GroupĀ® is a full service employee benefits company specializing in the design, implementation and administration of cost-effective fringe benefit plans for federal, state and local government contractors. Since 1982, The Boon Group has developed a partnership philosophy that expands beyond the products and services we offer. We stand with the employers and employees who, just like all who work at The Boon Group, are faced with the daunting task of navigating the U.S. healthcare system. Together, we can find a better way for all Americans to access healthcare. The Boon Group, Inc. is the parent holding company of The Boon Insurance Agency, Inc., Boon Administrative Services, Inc. (formerly named CEBA), Boon Insurance Management Services, L.P., Health & Welfare Benefit Systems, Inc. and Boon Investment Group, Inc. The Boon Group was formed to support and strengthen the position of these companies as a wholesaler of exclusive products and services. www.boongroup.com
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