The Business Council supports this legislation that would establish a workable approach to securing reports from state contractors on their “fair pay” compliance.
This bill is in response to Governor Cuomo’s Executive Order 162 that imposes complex and vague reporting requirements on businesses with contracts with the state, but would fail to provide meaningful information on those businesses’ pay practices.
This bill amends existing provisions of the state’s Executive Law dealing with the diversity practices of state contractors. Specifically, it allows the state to require that, for contracts valued at more than $250,000, contractors must submit annual reports showing the distribution of their workforce by ethnic background, gender, federal occupational category and pay range. This report may be based on either the contractor's total workforce or that portion of their workforce that is utilized in the performance of the state contract. Since the granularity of these reports could show pay levels of individual employees, and because such reports would illustrate confidential business practices, individual reports would be categorically exempt from disclosure under the Freedom of Information Act.
Executive Order 162 was issued in January 2017, and is applicable to contracts entered into on or after June 1, 2017. Under its implementation plan, contractors were required to begin submitting reports in April 2018. The order, and its implementation plan, required monthly or quarterly data, with excessive reporting details. As such, it would impose a significant paperwork and reporting burden on contractors. Even more important, because the data shows nothing about the relative skill, experience or education of employers, at best it would provide misleading information on “pay equity” factors.
We believe this legislation provides a workable data reporting mandate, while providing employers and employees with reasonable protections against disclosure of sensitive pay data. If the state is to have a pay equity reporting requirement for state contractors, we far prefer the approach set forth in S.6362-A than that of EO 162.
For these reasons, The Business Council supports adoption of S.6362-A.