- JP Morgan Chase & Co. has agreed to pay $800,000 in back pay and interest and set aside $9 million over five years to resolve charges that it has underpaid women in its investment bank and technology and market strategies function since 2012, according to a November conciliation agreement with the U.S. Department of Labor's Office of Federal Contract Compliance Programs (OFCCP).
- Under the agreement, use the $9 million for annual pay adjustments. Beginning in 2021 and continuing for several years, the company will conduct pay equity analyses of U.S. employees to address pay equity for women and minorities. Beginning in 2022 and continuing for several years, the company agreed to make annual pay equity adjustments. If the pay adjustments don't require the full amount set aside, the difference will be used to fund inclusion and diversity efforts and programs, the settlement agreement said.
- "Although we strongly dispute the allegations, this resolution allows all parties to move forward cooperatively," a JP Morgan spokesperson said in a statement emailed to HR Dive.
OFCCP, according to its website, enforces the anti-discrimination laws that make it illegal for federal contractors and subcontractors to discriminate on the basis of race, color, religion, sex, sexual orientation, gender identity, national origin, disability or veteran status. Nearly 25% of the U.S. workforce is employed by federal contractors and subcontractors, according to OFCCP.
OFCCP enforcement collections hit a record high in FY2019 and settlements included the resolution of pay equity claims. Bank of America, Dell and Goldman Sachs entered into settlements totaling $20 million resolving pay discrimination claims with the federal agency.
Pay equity has been a concern for many companies, not just those dealing with a government investigation. According to 2019 research from WorldatWork and Korn Ferry, 60% of employers are actively working to achieve pay equity; however, 7% of survey respondents said the issue isn't on their radar at all.
HR can review compensation policies and practices and work with supervisors to identify disparities and conduct regular pay audits, some experts have suggested. Notably, they said, employers may want to conduct audits with the assistance of counsel to ensure the information remains privileged.