Federal Employment Laws That Impact Compensation and Benefits

Equal Employment Opportunity

Let’s take a look at each of the laws and regulations that most affect compensation and benefits. We will start with the Equal Employment Opportunity Act, which encompasses a series of federal laws enforced by the Equal Employment Opportunity Commission (EEOC).

The laws enforced by the EEOC are the following:

  • Title VII Civil Rights Acts of 1964 and 1991
  • The Pregnancy Discrimination Act
  • The Equal Pay Act of 1963 (EPA)
  • The Age Discrimination in Employment Act of 1967
  • Title I of the Americans with Disabilities Act of 1990 (ADA)
  • Sections 102 and 103 of the Civil Rights Act of 1991
  • Sections 501 and 505 of the Rehabilitation Act of 1973
  • The Genetic Information Nondiscrimination Act of 2008 (GINA)

State laws on civil rights matters have been in effect longer but have been superseded by federal laws.

EEO laws prohibit discrimination against an employee or job applicant based on race, color, religion, sex (including pregnancy, gender identity, and sexual orientation), national origin, age (40 or older), disability or genetic information. Veterans are also protected by the laws enforced by the EEOC. EEO laws are applicable to hiring, firing, promotions, harassment, training, wages, benefits, and all other types of work situations and are intended to protect everyone, not just protected groups. Also, a person may not be discriminated against due to a discrimination complaint, a discrimination charge, or a discrimination investigation or lawsuit.

Typically, most employers with 15 or more employees are covered by EEO laws, and those with 20 or more employees are subject to age discrimination laws. Employment agencies and labor unions are typically also covered by EEO laws.

An annual EEO-1 report must be filed by March 31 of each year for applicable organizations that are:

  • Subject to Title VII of the Civil Rights Act of 1964, as amended, with 100 or more employees, or
  • Subject to Title VII of the Civil Rights Act of 1964, as amended, with fewer than 100 employees if the company is owned by or corporately affiliated with another company and the entire enterprise employs a total of 100 or more employees, or
  • Federal government prime contractors or first-tier subcontractors subject to Executive Order 11246, as amended, with 50 or more employees and a prime contract, or first-tier subcontract amounting to $50,000 or more.

This is an annual filing required by the EEOC which is responsible for enforcing federal anti-discrimination laws. The EEOC uses EEO-1 data to support enforcement of civil rights while analyzing employment practices, such as the representation of female and minority workers within companies. The EEO-1 report provides the data needed to determine how effective an organization’s anti-discrimination practices are and if a closer review of its employment practices should take place. A federal audit may take place when further review is needed.

Affirmative Action:

Affirmative action programs, laws, and practices called for positive steps to correct the results of past discrimination. Affirmative action was based on the 1965 Executive Order (EO) 11246 that required federal contractors to take “affirmative action” to address underrepresentation in their workforce based on sex or race. The EO was amended in 2014 to include sexual orientation and gender identity for affirmative action. In 2025 this EO was rescinded and replaced with EO 14173 which requires that all federal contractors and recipients of federal funds make employment decisions based strictly on merit or skill and not workforce balancing. In addition to recipients of federal funds, the federal government has also issued guidance to the private sector to eliminate Diversity, Equity, and Inclusion (DEI) programs that violate federal anti-discrimination laws.

The intent of EO 14173 is to ensure that everyone is treated equally in employment decisions, and this has been reinforced by a recent Supreme Court ruling, Ames v. Ohio Department of Youth Services, that rejected the practice of lower courts to hold reverse discrimination challenges to a higher burden of proof.