The government is proposing to require employers to report pay data by race, gender and ethnicity. The president is using executive power to make the rule change, which is set to take effect in 2017.

Transcript

ROBERT SIEGEL, HOST:

President Obama has announced that, for the first time, employers will have to disclose data about what they pay their employees. This is along with information that’s already provided about race, gender and ethnicity. The administration says this will enable regulators to crack down on pay discrimination. NPR’s Yuki Noguchi reports.

YUKI NOGUCHI, BYLINE: The president made the announcement at an event celebrating the seventh anniversary of the Lilly Ledbetter Fair Pay Act. The law extended the period in which a pay discrimination suit can be filed. But he says that’s only part of the equation.

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BARACK OBAMA: The typical woman who works full-time still earns 79 cents per every dollar that the typical man does. The gap’s even wider for women of color.

NOGUCHI: Equal Employment Opportunity Commission will collect data from employers with more than 100 workers. That will help determine where and which industries the pay gap persists. EEOC chairman Jenny Yang says that will also help her agency and the Labor Department enforce equal pay laws.

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JENNY YANG: Our agencies will use this data to more effectively focus investigations, assess complaints of discrimination and identify existing pay disparities that warrant further examination.

NOGUCHI: Yang also says she hopes the act of collecting and reporting the data will help companies self-correct. That was the case for Marc Benioff, CEO of salesforce.com. He says his team identified a pay gap he didn’t know existed.

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MARC BENIOFF: They said, hey, Mark, we may be paying women less at Salesforce. I go, that’s not possible. Well, guess what? We were – $3 million less.

NOGUCHI: The U.S. Chamber of Commerce criticized the new requirement, calling it burdensome. Other business groups say they’re reviewing the new rules. Sarah Moore is an attorney at Fisher and Phillips who represents employers. She says discussing pay used to be taboo in the office, but that’s rapidly giving way to transparency.

SARAH MOORE: It’s really key for companies to embrace the spirit of today’s announcement and begin to proactively prepare for the annual reporting of pay data to the EEOC.

NOGUCHI: Research suggests discrimination is only one reason for the pay gap. The president says he’ll also continue pushing to get more women in higher-paying jobs in science and technology, as well as fighting pregnancy discrimination and mandating paid family and sick leave. The new pay data rule is open for public comment and will take effect in September of next year. Yuki Noguchi, NPR News, Washington.

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