January 22, 2021
The Biden administration overturned a previous executive order by the Trump administration limiting federal contractors’ diversity and inclusion training, while also laying the groundwork for potential new wage reporting requirements.
The heads of the agencies covered by the Trump EO have 60 days to “consider suspending, revising, or rescinding any such actions, including all agency actions to terminate or restrict contracts or grants pursuant” to the EO.
In a statement last September, the HR Policy Association said that the Trump administration’s EO limited “the ability of companies to provide training they believe is effective in preventing systemic and organizational bias based on race, ethnicity, gender or any other factor, addressing it if it exists, and providing actual equal opportunity to all employees and applicants.”
In the same executive order, the Biden administration also established an “Equitable Data Working Group.” “Many Federal datasets are not disaggregated,” the EO reads, “by race, ethnicity, gender, disability, income, veteran status, or other key demographic variables. This lack of data has cascading effects and impedes efforts to measure and advance equity.”
The Working Group will advise the White House on “potential barriers that underserved communities and individuals may face in taking advantage of agency procurement and contracting opportunities.”
“An analysis shows that closing racial gaps in wages, housing credit, lending opportunities, and access to higher education would amount to an additional $5 trillion in gross domestic product in the American economy over the next 5 years.”
What it means: Revoking President Trump's executive order on diversity training is a clear victory for our members. Now the question is what employer expectations and obligations surrounding racial wage gaps will be. In addition to disaggregated workforce demographic disclosure, new wage reporting requirements for federal contractors may be likely in the future. We also may expect the reintroduction of EEOC pay data requirements promulgated under the Obama administration (or the introduction of similar mandates) requiring businesses to submit summary pay data by gender, race, and ethnicity.