Key Steps Organizations Can Take to Address Pay Equity

Many employers are familiar with the required annual submission of the EEOC’s EEO-1 filing, which gathers data on employees’ job categories, ethnicity, race and gender.

While the EEO-1 is a compliance layer, for a two-year period (2017-2018), the EEOC also required collection of employers’ pay data. The EEOC has ended pay data collection, but the original purpose of that policy was to help reduce gender (plus racial and ethnic) pay discrimination and enhance pay equity across the board.

As an issue, pay equity between men and women in the US continues to be unresolved. Women’s annual earnings in 2020, for example, were 82% of men’s (with a wider gap for many women of color), according to the US Bureau of Labor Statistics.

In addition, the US Department of Labor reports that, compared with white men with the same education, Black and Latina women with a bachelor’s degree have the largest pay gap at 65%, while Black women with advanced degrees earn 70% of what white men with advanced degrees earn.

With help from celebrity athletes such as US Women’s Soccer star, Megan Rapinoe, pay equity remains a front and center issue. To this end, what steps can companies and organizations take to help address pay equity for their employees?

Audit your pay scales: With the continued spread of equal pay legislation at the state level, it may be a good time to audit (and adjust accordingly) how your employees are paid. Consider evaluating positions on a “like for like” basis (adjusting for seniority, merit and related criteria). Auditing and adjusting pay scales for equity also lowers the risk of litigation.

Understand the Equal Pay Act’s (EPA) provisions: Under the EPA, note that pay differentials between employees are only permitted when they are based on seniority, merit, quantity or quality of production, or a factor other than gender, race or ethnicity. All other factors (such as gender, race or ethnicity) equate to equal pay for equal work (based on a job’s responsibilities and not title) as mandated by the EPA.

End salary history questions: As it stands today, 25 states (including Maryland and DC) ban employers from asking prospective job candidates about their salary histories. Salary history questions have long tended to impact, fairly or not, whether and how an offer is made to prospective new employees.

Amii Barnard-Bahn, a business consultant writing in Harvard Business Review, cites a quote by UC Berkeley’s Dr. Kellie McElhaney: “There is no way to feel more included than to be paid equal to the person sitting next to me.”

impactAction: If you have questions about establishing pay equity for your company or organization, contact us at or 443-741-3900.

Virginia Minimum Wage Increases to $9.50/Hour May 1, 2021

Virginia’s state minimum wage will increase to $9.50/hour (from its current rate of $7.25/hour) on May 1, 2021.

After this initial step, the state’s minimum wage is scheduled to rise to $11/hour on January 1, 2022 and to $12/hour on January 1, 2023.

Then, it will increase to $13.50/hour from January 1, 2025 and end by law at $15.00/hour from January 1, 2026.

In addition, Virginia’s new minimum wage rates will apply anew to the following categories of workers who have historically been exempt from the state’s minimum wage requirement:

  • Individuals employed in domestic service or in a private home (e.g., nannies and au pairs)
  • Individuals who normally work and are paid according to the amount of work done or completed
  • Individuals whose earning capacity is limited due to physical deficiency, mental illness or intellectual disability
  • Individuals employed by small businesses (those with four employees or less)

Following 2026, the state’s minimum wage will be adjusted annually each January 1 based on the consumer price index.

EEO-1 Filing Period Begins with July 19 Submission Deadline

The US Equal Employment Opportunity Commission (EEOC) this week opened its 2019 and 2020 EEO-1 Component 1 Data Collection period. The EEO-1 form compiles employer data that categorizes employees by race or ethnicity, gender and job category.

The EEOC’s deadline for submitting 2019 and 2020 EEO-1 Component 1 data is July 19, 2021.

EEO-1 report filing is required if your company meets the following criteria: 1) private employers with 100 or more employees and 2) federal government contractors or first-tier subcontractors with 50 or more employees and a contract/subcontract of $50,000 or more. Read more.

US ICE Extends I-9 Flexible Compliance Through May 31

The US Immigration and Customs Enforcement (ICE) has announced an extension through May 31, 2021 of its rule that employers with employees working remotely will not be required to review new employees’ identity and employment authorization documents in their employees’ physical presence.

ICE’s flexible I-9 policy only applies to employers and workplaces operating remotely. ICE states: “If there are employees physically present at a work location, no exceptions are being implemented at this time for in-person verification of identity and employment eligibility documentation for Form I-9, Employment Eligibility Verification.” Read more.

Women’s Leadership Conference Early Bird Registration Closes April 30

Take advantage of special Early Bird rates closing April 30 to participate in the Howard County Chamber’s virtual Women’s Leadership Conference 2021 this July 13!

The 2021 Women’s Leadership Conference (WLC) takes place Tuesday, July 13 (9:00am-3:00pm) virtually. This year’s theme is “Herstory: Leading To New Heights – S.O.A.R. Together”) including keynote presenters: Lisa Cregan, Managing Director, Morgan Stanley, and Carla Harris, Vice Chairman, Managing Director, Morgan Stanley. Register today!

Minimum Wage for Federal Contractors to Rise to $15/Hour by 2022

The White House announced yesterday an executive order that will raise the minimum wage for federal contractor employees to $15/hour (from $10.95/hour now) by March 30, 2022.

All agencies will need to incorporate a $15 minimum wage in new contract solicitations starting January 30, 2022, and then agencies will implement the new minimum wage rate into new contracts by March 30, 2022. Read more.