The Trump administration has halted an Obama-era rule requiring large companies to share data with the government about how they pay employees by race and gender -- but human resources experts and advocates for equal pay say it's unlikely to slow the push toward pay transparency that employees, shareholders and local governments have demanded in recent years.
Increasingly, employees are turning to popular websites like Glassdoor or Payscale to compare their salary data and expecting companies to publicly say that they pay men and women equally. Shareholders have pushed technology and financial services companies to release their gender pay gap statistics. And more state and local governments have passed pay equity laws, some of which require state contractors to report data or certify that they pay men and women the same.
"Our culture is moving toward greater pay transparency, and I don’t think you can unwind that clock," said Fatima Goss Graves, chief executive of the National Women’s Law Center. "The White House's effort to stop the rule is not going to stop the push for pay transparency that's coming from employers or from shareholders. States are going to start stepping up and filling in the breach."
Human resources experts agreed. "In terms of the immediate impact of the halting the rule, honestly I don't anticipate it’s going to have a real impact," said Gail Greenfield, a principal at the consulting firm Mercer. "The momentum is already there on pay transparency. You can't take that back."
Greenfield said that as shareholders have pushed for companies to disclose more about their equal pay practices -- investors such as Arjuna Capital and Pax World Management have done so -- a "peer effect" has inspired other companies to talk more openly about their pay gap.
"Even if you don't work for Google or Apple or Intel, you read the news as a person in the labor market," she said. "People pay attention to that information that those tech companies are sharing. If another company doesn’t release the data, does this mean it's not a priority? As more companies become transparent, there’s going to be greater pressure for other companies to become transparent."
The data, after all, is just a mouse click away for many employees with the expansion of web sites like Glassdoor. Dawn Lyon, vice president of corporate affairs for the pay data site, said they've seen "a sizable increase in employers hungry for information about how they make sure they don't have a pay gap" over the past two years, with more than 3,700 adding an equal pay "pledge" to their company profile during that time.
"We’re seeing pay equality and commitments to pay equality really influencing employers' brands," she said. At a time with such low unemployment, "these are things that set companies apart."
Brian Kropp, who leads the human resources consulting practice at CEB, says there's been a striking uptick in companies rushing to analyze and understand whether they have a pay gap. In a recent survey CEB did of 78 Fortune 1000 companies, he said, 69 percent said they had launched a pay equity effort in the past two years. While some of that rush has come from regulatory pressure, he said, "there’s also a broader debate within society about the unfairness of the gender wage gap," and companies have felt compelled to respond.
Meanwhile, even as a federal rule has been halted (federal contractors will still provide data to the government) state-level regulations have emerged in recent years. At least five states or cities, according to the National Women's Law Center, have some kind of equal pay certification or reporting requirement -- typically for state contractors, though there is a pending bill in California focused on large employers more generally.
That could have a broader effect than in just those states or cities, said Kropp, as large companies that do business in multiple jurisdictions often adopt practices more widely to keep things standard. "If you’re a large employer you can’t treat it as a local initiative," he said.
He also thinks local ordinances could proliferate: "I can guarantee you, now that the Trump administration has put a stop to this reporting, the legislators, the mayors, the state senators -- those local jurisdictions -- will start to pass their own regulations, their own laws, where companies will have to report their numbers."
Still, halting the reporting rule at the federal level could hurt enforcement and accountability. When companies report that they have virtually no gender pay gap -- even if calculated from a sophisticated algorithm -- that's an aggregate number that may mask bigger gaps among more narrow job categories.
"There’s a big difference in what they report publicly and what they do internally," Mercer's Greenfield said. Many, she said, are working to rectify the gaps they find among individual jobs but are hardly going to include those gaps they discover in the news releases -- or may work to fix them before they go public. "There’s a difference between compensation management and public relations."
Still, the demands from employees for more pay transparency is only expected to grow. Millennial employees, in particular, don't see talk about salaries as taboo, Glassdoor's Lyon said.
"The genie is out of the bottle, and it’s not going anywhere," she said. "It’s what workers expect."
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