The Business Council opposes this legislation for several reasons.
This bill would require entities entering into most procurement contracts with New York State to agree to submit “equal pay reports,” in a form and on a schedule to be determined through regulations issued by the Office of State Comptroller.
Our first concern is that this legislation would duplicate an existing New York State reporting mandate. The Cuomo administration posted final implementation guidelines for its Executive Order 162 in December 2017 (see https://esd.ny.gov/doing-business-ny/mwbe/mwbe-executive-order-162). As such, EO 162 already requires state contractors to disclose data on the gender, race, ethnicity, job title, and salary of employees performing work on state contracts issued and executed on or after June 1, 2017. Initial reports by contractors were due in the first quarter of 2018. The Executive Order also requires an annual report on this data to be provided to all state agencies.
Second, we are concerned that this legislation will require contractors to revamp their data collection systems just created for the exclusive purpose of filing reports mandated by EO 162. This legislation allows the Office of State Comptroller to adopt regulations on “the content and the timely and property filing” of equal pay reports by contractors. The bill mandates that these reports “... shall include, but not be limited to, a summary of the contractor's workforce pay averages, calculated by job category, gender, race, and ethnicity, and the difference between pay averages in each category, expressed as an absolute percentage.” These proposed reporting requirements are different than those mandated under the EO, and the bill allows the Comptroller to demand additional information, and/or more frequent reporting.
Third, these reporting mandates will provide a very incomplete assessment of an employer’s pay or pay equity practices. Research shows that factors such as work experience, career interruptions, the average weekly hours worked, and other factors have a significant impact on total wages, and inclusion of these factors significantly reduce or eliminate calculations of wage gaps. However, none of these additional factors would be captured in these reporting mandates. To do so, for all employees of all contractors would be an even more unworkable data collection and reporting mandate.
Finally, Business Council members also have serious concerns about the security of the data to be collected. Since this data “shall be available for public inspection and copying,” the “averaged pay data” and the “percent differences” by job category could – to the untrained eye – produce misleading information subjecting New York employers to potential damage to their reputation. In addition, this data, limited as it is, could give competitors an unfair advantage when it comes to things like bidding on contracts and identifying specific individual employees for job poaching.
Importantly, New York State has robust laws addressing workplace discrimination and wage payment. In addition, the state legislature has recently passed other legislation intended to result in more fair wages, such as Chapter 94, Laws of 2019, which prohibits employers from inquiring about past salary histories of job applicants.
We believe this legislation is unnecessary given existing state reporting mandates, and could result in additional, costly data collection and reporting requirements on state contractors.
For these reasons, the Business Council opposes adoption of S.1482 / A.7169.