WASHINGTON — President Obama proposed a new rule Friday that would require every large company in America to report employees’ pay based on race and gender, an effort to reduce longstanding pay inequities for women and members of minority groups.
The new policy, already drawing criticism from some business leaders, would order companies with at least 100 employees to add salary numbers on a form they already annually submit that reports employees’ sex, age, and job groups. The pay information would alert the EEOC to companies with significant wage disparities, which could result in hefty fines.
During the updated data collection process, officials would not publicly name employers or employees, said Jenny Yang, chairwoman of the Equal Employment Opportunity Commission, which published the proposed rule with the Department of Labor. If the agency files a suit as a result of the findings, however, companies would appear in public record.
On Thursday, the Massachusetts Senate unanimously passed a bill that would expand on an existing law and aims to close the gender wage gap by ensuring equal pay for comparable work, establishing pay transparency, and requiring fairness in hiring practices.
Massachusetts Attorney General Maura Healey was invited to speak on a panel at the White House on pay equity before the Obama announcement, and she brought state Senator Karen Spilka as her guest. Both attended the White House ceremony.
The proposal expands on Obama’s 2014 executive order that required all federal contractors to submit similar data.