In addition to digesting OFCCP’s release of a new directive on compensation, government contractors may soon see new regulations around inquiries into and the use of prior salary information.  In conjunction with Equal Pay Day, President Biden signed a new Executive Order on Advancing Economy, Efficiency, and Effectiveness in Federal Contracting by Promoting Pay Equity and Transparency.

In the Order, President Biden directs the Federal Acquisition Regulatory Council, in consultation with the Secretary of Labor to “consider issuing proposed rules to promote economy, efficiency, and effectiveness in Federal procurement by enhancing pay equity and transparency for job applicants and employees of Federal contractors and subcontractors.”  Specifically, the President instructs the FAR Council to

“consider whether any such rules should limit or prohibit Federal contractors and subcontractors from seeking and considering information about job applicants’ and employees’ existing or past compensation when making employment decisions.

Prohibitions on the reliance on prior salary history are not new, but up to this point have not been legislated at the federal level, and have come through state and municipal action.

We will keep our eyes open for proposed rulemaking and will follow up as more details become available.