Last week, President Trump signed an Executive Order that rolled back an Obama administration order called the “Fair Pay and Safe Workplaces Act.” While we’re not a political organization and support women in the workplace regardless of who they vote for, this particular situation deserves a closer look because of the way it affects women at work.
First, a little context: in 2010, the Government Accountability Office found that companies acting as federal contractors (and being awarded deals worth millions of dollars) were also violating labor laws. In other words, even though it is illegal to discriminate against women in the workplace, discrimination still happens.
The 2014 law tried to address this problem by giving a big financial incentive to obey those labor and discrimination laws by placing two notable requirements on anyone wanting to do business with the federal government.
First, certain companies contracting with the federal government were not allowed to have arbitration clauses for sexual harassment, assault or discrimination cases within their employment agreements. These clauses in contracts are often the reasons that women don’t file sexual harassment lawsuits against their employers when they do experience sexual harassment at work. High profile sexual harassment victim Gretchen Carlson, for example, has argued that these arbitration clauses are unfair and “silenced millions of women.”
Put simply, the arbitration clauses don’t allow victims of sexual harassment to sue. If they nevertheless tried to, the first legal hurdle they’d face would simply be to get past a motion to dismiss the lawsuit by the employer. For example, typically, the employer’s lawyers would argue that the female employee signed an agreement to forego lawsuits as part of her employment agreement.
While one could argue that these women had willingly agreed to submit to arbitration (a private process involving a third-party arbitrator rather than a process that goes through the public court system), let’s face it: when we get new jobs, few of us are going to negotiate a clause about how to deal with something like potential future sexual harassment or gender discrimination.
The second requirement for prospective federal contractors under the 2014 law was to make certain salary disclosures. We previously reported upon the expansion of these salary disclosure requirements by federal contractors to also include any company with at least 100 employees. Larger companies were already required to report employee pay by age, ethnicity, and gender but this significantly expanded the number of employers required to report pay figures. Some businesses, of course, were unhappy with this level of pay transparency and these rules were unpopular among many employers.
While the U.S. does already have important labor laws in place prohibiting discrimination in pay and sexual harassment, rolling back these requirements for federal contractors does mean women are more vulnerable at a wide range of companies (not least of which, are employers in the aerospace and defense industries which are typically at the bottom of our rankings of best industries for women). This makes it all the more important for women as individuals and employers who believe in gender equality to be vigilant about equal pay and ensure that sexual harassment is not tolerated.
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