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Obama Wants Companies To Disclose Salaries Based On Gender

President Barack Obama wants American companies to disclose salary information so the federal government can get a better look at the wage gap between genders.

The President's plan, which would not require legislative approval, would require companies with 100 or more employees to submit salary data broken down by gender, race and ethnicity, The Washington Times reports.

Companies that are faulted for paying women less than men could be targeted by the Equal Employment Opportunity Commission, according to the plan published by the commission on Jan. 29.

"Social change never happens overnight," Obama said, according to NPR. "It is a slog, and there are times when you just have to chip away and chip away. ... It's reliant on all of us to keep pushing that boulder up the hill."

Women made 77 cents for every $1 men earned when Obama was elected in 2008, The Washington Post reports. The wage gap has since narrowed slightly, with women now earning 79 cents on the dollar. 

Obama said he wants to deliver on a campaign pledge to help close the gap.

The plan isn't popular with some business groups.

“Requiring businesses to provide potentially thousands of data points for each location would obscure, not illuminate relevant information," Kelly Kolb, a vice president of the Retail Industry Leaders Association, said in a statement on the association's website. "For example, the common compensation differences between urban and rural areas or the wide range of jobs within single reporting groups would be ignored in the data yielded. In the end, the compiled data would be attractive fodder for those intent to mislead."

Companies could potentially expose themselves to lawsuits by reporting the data, The Washington Post reports. While the EEOC would release the data in an annual salary report, the commission would not publicly identify employers or list salary data by employee. However, companies targeted for enforcement action would be named in lawsuits.

About 67,000 companies would be required to report salary data to the government.

"Pay discrimination goes undetected because of a lack of accurate information about what people are paid," EEOC chairwoman Jenny Yang said at the White House conference. "Collecting this pay data would help fill a critical void we need to ensure American workers receive fair pay for their work."

Economists and analysts are divided over the proposal, with some waiting for more details -- including how the Obama administration plans to implement the policy -- before weighing in on whether it will ultimately help close the wage gap.

David Cohen, president of a consulting firm that conducts wage-gap studies, said the data will be of limited use in the 10 broad job categories by which the government plans to sort salaries.

He told the Post that a "professionals" category, for example, could range from social workers to nuclear engineers, making it difficult to draw conclusions.

"If the goal of this report is to raise awareness, that 'We're the government, and we care deeply about this wage gap' ... that's great," Cohen said. "If the goal is to use this report as a predictor of discrimination, it will fail."

Sources: The Washington Times, The Washington Post, NPR, RILA / Photo credit: Wikimedia Commons

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