Dive Brief:

• Intel Corp. has agreed to pay $3.5 million in back pay and interest to resolve charges that it underpaid female, African American and Hispanic American employees at its facilities in Arizona, California and Oregon. The computing giant also agreed to allocate at least $1.5 million in pay equity adjustments for the next five years for U.S. employees in engineering positions as part of its annual pay equity analysis.
• The U.S. Department of Labor (DOL) says Intel voluntarily came to an "Early Resolution Agreement" and "agreed to take proactive steps to enhance its compliance with Executive Order 11246" to ensure non-discriminatory pay practices. EO 11246 prohibits federal contractors and federally‐assisted construction contractors and subcontractors who do over $10,000 in Government business in one year from discriminating in employment decisions on the basis of race, color, religion, sex, sexual orientation, gender identity or national origin and from retaliating against federal contractors and subcontractors who discuss their pay or share pay information with others.
• The "Early Resolution Procedures" program was launched by DOL's Office of Federal Contract Compliance Programs (OFCCP) in November 2018 with an eye toward resolving compliance evaluations at an early stage. Contractors that take advantage of the initiative are exempt from evaluations for five years.

Dive Insight:

Tech companies continue to make headlines when it comes to pay equity, generally because of claims of underpayment by women and minorities. Last month, a female engineer at Google took the company to court, claiming that she is being paid less than her male peers and that she suffered a retaliatory demotion after complaining about the alleged pay practice. In May 2018, computing giant Dell EMC, a Dell subsidiary, agreed to pay $2.9 million to resolve allegations of pay inequality at four locations in California and North Carolina, following a routine compliance evaluation by OFCCP. The audit determined that Dell EMC systemically discriminated against women in engineering, manufacturing, marketing and sales roles and that, for some roles, women and African American employees were paid less than white males. The company denied liability and agreed to the settlement that included pay adjustments.

It follows that pay equity is a big concern these days for many companies — not just those hit with an investigation. According to a recent survey, 60% of employers are actively working to achieve pay equity. Seven percent of respondents said the issue isn't on their radar at all. HR can review organizational compensation policies and practices, work with supervisors to identify disparities and conduct regular pay audits. Employers may wish to conduct these audits with the assistance of counsel to ensure the information is privileged and not discoverable in the event of a lawsuit. 

And because using salary history as a benchmark could encourage continued pay gaps, employers with multi-state facilities as well as those with facilities in more than one part of a state, should be aware that an increasing number of states and localities are banning questions about prior pay levels.