VA to Examine Company Payrolls, Hunting Bias

By Steve Haner

How bad is the climate for business in Virginia now? Just how much does this New Blue General Assembly detest and distrust evil capitalists? Let’s look at one little bill first noticed Monday in the long string of bills rushing toward Tuesday’s deadline for action. House Bill 624 won’t be the worst bill of the session, but it is very revealing of the new mindset.

Del. Chris Hurst, D-Blacksburg, sold this bill to the House of Delegates Monday with the common and debatable statistic that women earn 79 cents compared to every dollar earned by men. He wants the state to take on the role of ferreting that out worker by worker and devising a state-enforced solution. Doing so will mean $24 billion more paid to female Virginia workers, he claimed.

Step one is a small thing, a simple requirement that every business in Virginia with 100 or more employees file an annual report on how it pays its employees, by gender (just the two?). The reports will be filed with the Office of the Attorney General, which seems willing to take on the task, based on the low-ball financial impact it filed on the bill. It needs a couple more people, some work on its IT systems – maybe $300,000 a year, it reported. Really?

What data will every employer need to provide on every employee every year?

B. Any company that employs 100 or more employees shall provide annually to the Division the following information for each employee: (i) gender, (ii) race, (iii) job title, (iv) department, (v) job grade or level, (vi) hire date, (vii) job location, (viii) hours worked over the past 52 weeks, (ix) base wage or salary, (x) overtime pay and bonuses or other forms of compensation, (xi) applicable performance scores or ratings, (xii) level of education, and (xiii) years of experience in the relevant field or industry.

Remember, these are the same people who are passing legislation to make it illegal for the employer to ask your salary history. Now the state will have its own 13-field database on that, and so much more. This appears to a different data set than the federal government is now requiring of the same companies.

As introduced, the bill applied to employers of 500 people or more. At one point as it worked its way through committees that was reduced to 25 employees or more. Just moving the threshold from 500 down to 100 multiplied the number of mandatory reports to be filed and examined exponentially. 

The Attorney General’s Office, apparently salivating over the incredible amount of statistical evidence to mine coming its way, has left the initial and knowingly false fiscal impact statement intact. It will take a large group of new state government employees to compile and sort through such reports. The larger the team of inspectors, the more they will find.

The data is not going to rest in some ignored spreadsheet. Read the bill! It will be used to do something:

By November 30 of each year, the (Human Rights) Division shall develop a standard for how to evaluate discrimination in compensation on the basis of gender as prohibited by § 40.1-28.6. Such standard shall be developed utilizing the information received pursuant to subsection B.

2. That the Division of Human Rights shall provide recommendations regarding appropriate enforcement mechanisms, including causes of action and civil remedies, to address discrimination in compensation to the General Assembly by November 30, 2020.

When challenged in a brief debate, Hurst dodged the question of whether this bill is laying the groundwork for a wave of enforcement litigation, but clearly that is the intent. Because the debate caused drowsing delegates to wake up for a second, the bill initially failed on a voice vote. But once they were “put on the board,” enough Democrats rallied to Hurst’s cause to save the bill 51-39. A final third reading vote will occur today.  (Update:  It passed 54-44.)

The cost to the taxpayers to compile and analyze the reports is tiny compared to the compliance cost to be imposed on thousands of companies, some Virginia based and presumably many others from out of state or overseas. There was no discussion on the floor of whether it would make more sense to merely seek copies of federal reports, or (heaven forbid) let the federal government do the policing. This is a whole new task for every human resources department and a new set of regulators to deal with.

All those companies are already under legal mandate to pay male and female workers the same wage for similar work and circumstances, and most are very sensitive to complaints on that front. The debate persists because paying the same for the same job is only a part of the disparity, which also reflects the smaller (but growing) share of women in skilled, professional and management jobs, and the time they take off for child rearing.

But if Virginia’s General Assembly and activist attorney general can be seen to be doing something, if they can ferret out some employer and flog the company into paying women more (call the media!), then the compliance burden will be justified in their minds. Companies have an easy solution. If already here, move out. If thinking about coming to Virginia, don’t. By March this will be just one of a dozen new reasons to flee.