Lacking congressional support to raise wages or end gender pay disparities, President Barack Obama is again imposing his policies on federal contractors, in keeping with presidents’ tradition of exerting their powers on a faction of the economy they directly control.
Obama will sign an executive order Tuesday barring federal contractors from retaliating against employees who discuss their pay with one another The order is similar to language in a Senate bill aimed at closing a pay gap between men and women. That measure is scheduled for a vote this week, but is unlikely to pass.
The president also will direct the Labor Department to adopt rules requiring federal contractors to provide compensation data based on sex and race.
He plans to sign the two executive orders during an event at the White House where he will be joined by Lilly Ledbetter, whose name appears on a pay discrimination law Obama signed in 2009.
The moves showcase Obama’s efforts to seek action without congressional approval and demonstrate that even without legislation, the president can drive economic policy. At the same time, they show the limits of his ambition when he doesn’t have the support of Congress for his initiatives.
Republicans say Obama is pushing his executive powers too far and should do more to work with Congress. His new executive orders are sure to lead to criticism that he is placing an undue burden on companies and increasing their costs.
Federal contracting covers about one-quarter of the U.S. workforce and includes companies ranging from Boeing to small parts suppliers and service providers. As a result, presidential directives can have a wide and direct impact. Such actions also can be largely symbolic, designed to spur action in the broader economy.
“This really is about giving people access to more information both to help them make decisions at the policy level but also for individuals,” said Heather Boushey, executive director and chief economist at the Washington Center for Equitable Growth. She has been working with the administration to get compensation information about the nation’s workforce.
“This is definitely an encouraging first step,” she said.
Federal contractors, however, worry that additional compensation data could be used to fuel wage related lawsuits, said James Plunkett, director of labor policy at the U.S. Chamber of Commerce.
What’s more, he said, such orders create a two-tiered system where rules apply to federal contractors but not to other employers. Those contractors, knowing that their business relies on the government, are less likely to put up a fight, he said.
“Federal contractors ultimately know that they have to play nicely to a certain extent with the federal government,” he said.
In a separate action today, Obama intends to announce 24 schools that will share more than $100 million in grants to redesign themselves to better prepare high school students for college or for careers. The awards are part of an order Obama signed last year. Money for the program comes from fees that companies pay for visas to hire foreign workers for specialized jobs.
The moves represent a return to economic issues for the president after two weeks devoted almost exclusively to diplomacy and the final deadline for health insurance coverage
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