DOL proposes rule for more contractor pay transparency

The U.S. Department of Labor announced Monday a proposed rule that would prohibit federal contractors from maintaining pay secrecy policies.

Under terms of the proposal, which will be published in the Sept. 17 issue of the Federal Register and open for public comment for 90 days, federal contractors and subcontractors may not fire, or otherwise discriminate against, any employee or applicant for discussing, disclosing or inquiring about their compensation or that of another employee or applicant, the DOL said in its statement.

“Workers cannot solve a problem unless they are able to identify it. And they cannot identify it if they aren’t free to talk about it without fear of reprisal,” said OFCCP Director Patricia A. Shiu, in a statement. “Pay transparency isn’t just good for workers. It’s good for business. Fairness and openness are great qualities for a company’s brand.”

President Obama signed Executive Order 13665 on April 8, instructing the secretary of labor to propose a rule within 160 days to require pay transparency among federal contractors.

The proposed rule would amend the equal opportunity clauses in an earlier executive order to afford protections to workers who talk about pay, the DOL said. It would also add definitions for compensation, compensation information and essential job functions, terms which appear in the revised clauses.