A BILL TO BE ENTITLED
AN ACT addressing fair pay in state government employment by requiring management accountability for pay‑related personnel decisions.
The General Assembly of North Carolina enacts:
SECTION 1.  Article 2 of Chapter 126 of the General Statutes is amended by adding a new section to read:
"§ 126‑7.3.  Fair pay; management accountability.
(a)	It is the intent of the General Assembly to address any pay disparities in wages in similar jobs held by State employees. In order to lessen any disparities, decisions regarding salary administration adjustments shall include consideration of wage equity between men and women and employees of different races in similar jobs along with performance, market differences between similar jobs, and availability of funds. If any salary adjustment decision could potentially create a pay inequity, the reasons for granting the adjustment shall be justified in writing. Managers shall document any pay disparities and shall be encouraged to take steps that would lessen disparities.
(b)	The head of each State agency, department, and institution and The University of North Carolina shall act in conformity with fair pay laws and policies when making personnel decisions relating to the compensation of State employees. Managers and supervisors shall receive training on fair pay laws and policies and race and gender‑related compensation issues. The human resources office shall ensure that management is responsible for adhering to fair pay laws and policies. Managers shall be evaluated based on their compliance with fair pay laws and policies. The failure of management to abide by fair pay laws and policies may result in the reduction of salary reserves allocated by the Office of State Budget and Management.
(c)	For the purposes of this section, "similar jobs" are jobs whose composite competencies, training, experience, skill, responsibility, market comparisons, and working conditions are equivalent."
SECTION 2.  G.S. 126‑4 reads as rewritten:
"§ 126‑4.  Powers and duties of State Personnel Commission.
Subject to the approval of the Governor, the State Personnel Commission shall establish policies and rules governing each of the following:
(1)	Position classification plans which shall provide for the classification and reclassification of all positions subject to this Chapter according to the duties and responsibilities of the positions.
(2)	Compensation plans which shall provide for minimum, maximum, and intermediate rates of pay for all employees subject to the provisions of this Chapter.
(3)	For each class of positions, reasonable qualifications as to education, experience, specialized training, licenses, certifications, and other job‑related requirements pertinent to the work to be performed.
(4)	Recruitment programs designed to promote public employment, communicate current hiring activities within State government, and attract a sufficient flow of internal and external applicants; and determine the relative fitness of applicants for the respective positions.
(5)	Hours and days of work, holidays, vacation, sick leave, and other matters pertaining to the conditions of employment. The legal public holidays established by the Commission as paid holidays for State employees shall include Martin Luther King, Jr.'s Birthday and Veterans Day. The Commission shall not provide for more than 11 paid holidays per year except that in those years in which Christmas Day falls on a Tuesday, Wednesday, or Thursday, the Commission shall not provide for more than 12 paid holidays.
(5a)	In years in which New Year's Day falls on Saturday, the Commission may designate December 31 of the previous calendar year as the New Year's holiday, provided that the number of holidays for the previous calendar year does not exceed 12 and the number of holidays for the current year does not exceed 10. When New Year's Day falls on either Saturday or Sunday, the constituent institutions of The University of North Carolina that adopt alternative dates to recognize the legal public holidays set forth in subdivision (5) of this section and established by the Commission may designate, in accordance with the rules of the Commission and the requirements of this subdivision, December 31 of the previous calendar year as the New Year's holiday.
(6)	The appointment, promotion, transfer, demotion and suspension of employees.
(7)	Cooperation with the State Board of Education, the Department of Public Instruction, the University of North Carolina, and the Community Colleges of the State and other appropriate resources in developing programs in, including but not limited to, management and supervisory skills, performance evaluation, specialized employee skills, accident prevention, equal employment opportunity awareness, including gender and race-related compensation issues, and customer service; and to maintain an accredited Certified Public Manager program.
(7a)	The separation of employees.
(8)	A program of meritorious service awards.
(9)	The investigation of complaints and the issuing of such binding corrective orders or such other appropriate action concerning employment, promotion, demotion, transfer, discharge, reinstatement, and any other issue defined as a contested case issue by this Chapter in all cases as the Commission shall find justified.
(10)	Programs of employee assistance, productivity incentives, equal opportunity, safety and health as required by Part 1 of Article 63 of Chapter 143 of the General Statutes, and such other programs and procedures as may be necessary to promote efficiency of administration and provide for a fair and modern system of personnel administration. This subdivision may not be construed to authorize the establishment of an incentive pay program.
(11)	In cases where the Commission finds discrimination, harassment, or orders reinstatement or back pay whether (i) heard by the Commission or (ii) appealed for limited review after settlement or (iii) resolved at the agency level, the assessment of reasonable attorneys' fees and witnesses' fees against the State agency involved.
(12)	Repealed by Session Laws 1987, c. 320, s. 2.
(13)	Repealed by Session Laws 1987, c. 320, s. 3.
(14)	The implementation of G.S. 126‑5(e).
(15)	Recognition of State employees, public personnel management, and management excellence.
(16)	The implementation of G.S.  126‑7 and G.S. 126‑7.3.
(17)	An alternative dispute resolution procedure.
(18)	Delegation of authority for approval of personnel actions through decentralization agreements with the heads of State agencies, departments, and institutions.
a.	Decentralization agreements with Executive Branch agencies shall require a person, designated in the agency, to be accountable to the State Personnel Director for the compliance of all personnel actions taken pursuant to the delegated authority of the agency. Such agreements shall specify the required rules and standards for agency personnel administration.
b.	The State Personnel Director shall have the authority to take appropriate corrective actions including adjusting employee salaries and changing employee classifications that are not in compliance with policy or standards and to suspend decentralization agreements for agency noncompliance with the required personnel administration standards.
(19)	Conduct studies to address any pay disparities for equivalent jobs in State government, including wage disparities between men and women, review of the minimum annual salary for State employees, and review of any other pay disparities in State government employment resulting from compensation policies, classification, and job categories.
The policies and rules of the Commission shall not limit the power of any elected or appointed department head, in the department head's discretion and upon the department head's determination that it is in the best interest of the Department, to transfer, demote, or separate a State employee who is not a career State employee as defined by this Chapter."
SECTION 3.  G.S. 126‑7 is amended by adding a new subsection to read:
"(b2)	The annual compensation report shall include any disparities in various occupational groups and make recommendations to correct those disparities."
SECTION 4.  G.S. 126‑16 reads as rewritten:
"§ 126‑16.  Equal opportunity for employment and compensation by State departments and agencies and local political subdivisions.
(a)	All State departments and agencies and all local political subdivisions of North Carolina shall give equal opportunity for employment and compensation, without regard to race, religion, color, creed, national origin, sex, age, or handicapping condition as defined in G.S. 168A‑3 to all persons otherwise qualified, except where specific age, sex or physical requirements constitute bona fide occupational qualifications necessary to proper and efficient administration. This section with respect to equal opportunity as to age shall be limited to individuals who are at least 40 years of age.
(b)	Each State agency, department, and institution and The University of North Carolina shall strive for diversity in all occupational categories, take positive approaches, and implement best personnel practices to ensure equal opportunity, prevent discrimination, promote fairness, and to support an inclusive environment."
SECTION 5.  This act is effective when it becomes law.