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What’s next for employers, now that the Trump administration has pulled back a requirement for certain businesses to report pay data to the government?
“The first order of business is to ensure that the regulated community knows what their compliance obligations are,” Victoria A. Lipnic (R), acting chair of the Equal Employment Opportunity Commission, told Bloomberg BNA Aug. 30.
The White House’s Office of Information and Regulatory Affairs announced Aug. 29 that it would stay and review an Obama-era pay data collection component of the EEO-1 Report, which many employers are required to file annually with the EEOC. Covered employers, however, still must report workforce data by sex, race, and ethnicity across 10 occupational categories by March 31, 2018.
The EEOC will publish “as soon as possible” a Federal Register notice that will discuss employers’ reporting obligations under existing EEO-1 requirements, as well as technical assistance documents, Lipnic said.
In a memorandum to the commission, OIRA directed the agency to submit a “new information collection package for the EEO-1 form” for review by the Office of Management and Budget. The old pay data proposal would have required private employers with 100 or more employees, including certain government contractors, to report data on wages and hours worked categorized by sex, race, and ethnicity.
The U.S. Chamber of Commerce and other business groups praised OIRA’s decision to halt the pay data collection. They have argued that it would be overly burdensome for employers and that the data would have no practical utility in uncovering pay disparities. Worker advocates, however, condemned the move as harmful to equal pay efforts. They have said the data are needed to help combat lingering pay gaps based on sex and race.
The EEOC will review its options on whether to move forward with some form of pay data collection, Lipnic said. The commission will eventually welcome two new Republican commissioners, pending Senate confirmation, one of whom is slated to be the next chair.
“The commission will look at what transpired here and decide what to do going forward,” she said. “This is a real opportunity to look at, in a holistic fashion, the reasons for the wage gap and the role everyone plays, from enforcement agencies to private employers to advocacy groups, to reach meaningful policy solutions to address it.”
The EEOC could proceed in several ways, employer-side and worker-side advocates told Bloomberg BNA.
“The ball is in EEOC’s court to set out how they want to proceed,” Emily Martin, general counsel and vice president for workplace justice at the National Women’s Law Center in Washington, told Bloomberg BNA Aug. 30.
One option is for the agency to provide updated burden estimates to the OMB to justify the form as it was previously proposed and approved. Lipnic said that option is “the least likely.”
Martin said another option could be for the agency to offer some new variation on the pay data collection.
For example, the EEOC could require pay data reporting from only larger employers by increasing the worker thresholds, she said. The commission also could request salary data without requiring as much detail on hours worked, she said. Or it could establish pilot programs that would collect pay data from certain industries or from only federal contractors.
The pay data aspect of the EEO-1 Report originated from an earlier Obama-era proposal from the Labor Department’s Office of Federal Contract Compliance Programs, which monitors federal contractors for workplace affirmative action and nondiscrimination compliance. The OFCCP’s proposed Equal Pay Report would have collected summary pay data on contractor workforces based on race, sex, and ethnicity. The agency had planned to extract aggregate industry-based data from the reports that it said would help contractors assess their pay practices and policies and make pay adjustments.
Whether the OFCCP would revisit that report under the Trump administration is up in the air. But an EEOC pilot program on collecting pay data from federal contractors could be useful by starting with employers that have more experience in collecting and analyzing those data, Martin said.
“There’s a lot of different ways to approach pay data collection and any assertion that it’s not possible to do strikes me as disingenuous,” Martin said. “Women’s rights advocates and civil rights advocates are eager to continue to engage on this issue as long as folks at the EEOC are willing to engage with us.”
Lipnic said she didn’t know if it’s a “correct assumption” that there might still be some kind of pay data collection moving forward.
As for pilot programs, Lipnic said the EEOC retained a consultant to conduct a pilot study on collecting pay data from employers and developing burden estimates. The consultant issued a final report in 2015.
“I’m only one voice on this, but I’m pretty skeptical of the utility of pilot programs,” Lipnic said.
She agreed that collaboration among enforcement agencies and stakeholders should continue on pay equity efforts.
Another option for the EEOC could be for it to take a step back from efforts to collect summary pay data from employers and instead “look at the picture of pay discrimination more broadly,” Michael Eastman, vice president of policy and assistant general counsel of the Center for Workplace Compliance in Washington, told Bloomberg BNA.
The employer community remains skeptical that reporting summary pay data will have practical use for employers and federal agencies, given the government’s track record with previous collection tools, Eastman said.
For example, the Clinton administration adopted an Equal Opportunity Survey, which had required federal contractors to submit to the OFCCP detailed information about their compensation practices. The controversial EO survey was later rescinded during the Bush administration after the OFCCP concluded it was “no longer of value to accomplish the objectives it was designed to address.”
Instead of focusing on data reporting, the EEOC could engage stakeholders, offer best practices to employers, and “think through broader strategies” to combat pay discrimination, Eastman said.
To contact the reporter on this story: Jay-Anne B. Casuga in Washington at firstname.lastname@example.org
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