As discussed in last week’s Fox Workplace Watch Alert, the Office of Federal Contract Compliance Programs (OFCCP) announced its largest pay equity recovery to date – a $5 million settlement of gender and racial pay discrimination claims it brought against State Street Corporation after a six-year investigation into the financial services firm’s compensation practices.  In essence, OFCCP alleged that a statistically significant disparity existed between the compensation paid to hundreds of women, and more than a dozen black, executives than that paid to their similarly situated male and white coworkers, respectively.

OFCCP’s action demonstrates how it can marshal sophisticated analytics to tease out pay disparities that otherwise may have gone unnoticed.  Like many other issues championed by the prior administration, it remains to be seen whether OFCCP’s recent focus on this issue will continue in the Trump Administration.  But federal contractors should pay attention to this settlement and take the opportunity to perform internal audits and address any potential issues before being the subject of a pay equity action (not to mention blog posts and alerts!).

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