Biden administration announces steps to prohibit use of salary history for federal employees, contractors

The Biden administration announced on Monday two new steps to prohibit the use of salary history for federal employees and federal contractors.

For federal workers, the Office of Personnel Management (OPM) announced a new regulation for agencies that will prohibit the use of salary history in setting pay for roles in the government.

For federal contractors, the administration announced a proposed rule that would prohibit contractors from seeking and considering information about job applicants’ past compensation when making employment decisions.

The proposed rule, which the Federal Acquisition Regulatory Council will publish on Monday, would also institute pay transparency measures that require contractors to disclose compensation ranges in job postings.

“Relying on a candidate salary history can exacerbate pre-existing inequality in our pay structures and disproportionately impact women and workers of color,” Shalanda Young, director of the Office of Management and Budget, told reporters.

The regulation and proposed rule are both in an effort for federal employers to disclose expected salary ranges in job postings and reduce pay secrecy to help workers negotiate.

The Biden administration marked the 15-year anniversary of the Lilly Ledbetter Fair Pay Act with the announcements. The law, signed during the Obama-Biden administration, expanded important protections against pay discrimination.

“Despite this progress, the fight for equal pay continues. Women workers are still paid on average 84 cents for every dollar paid to men, and the disparities are even greater for many women of color. Today, my Administration is taking new actions to advance pay equity for the federal workforce and employees of federal contractors,” Biden said in a statement.

The regulation for federal employees will be pushed on Jan. 30 and go into effect 60 days later. And, the proposed rule for federal contractors will go into a public comment period for 60 days.