Background: In March, a U.S. District Court for the District of Columbia reinstated the EEOC's annual pay data collection requirement that was put in place at the end of the Obama administration but suspended by the Trump administration in 2017 before it could be implemented. The reinstated pay data report will require employers to report the total number of employees and total number of hours worked for 12 different pay bands (pay ranges), 10 different EEO-1 job categories, and 14 different gender and race/ethnicity groups.
An amicus brief submitted by HR Policy and other trade associations to the court this week says “preparing to gather data prospectively will require approximately 18 months’ lead time” and gathering pay data retroactively for 2018 “is simply impractical.”
- Pay data collection “should not go into effect without confirmation that adequate EEOC protocols will be in place to protect highly confidential pay data,” the brief further argues.
Double implementation costs for employers? The EEOC said in its response to the court that in order to collect pay data this year, it will have to use a third-party outside contractor to develop a system that would only be used “one time for the collection of 2018 data,” and that the system would not be used after the EEOC transitions to its data collection process.
Data utility concerns: The EEOC is concerned the pay data that is collected “may not have sufficient integrity to support data comparisons or other analyses because of the limited quality control and quality assurance measures that would be implemented due to this expedited timeline.”
Failure to conduct a true pilot study also “increases the likelihood that measurement error will be introduced into the data.”
HR Policy urges Senate to confirm EEOC nominee: HR Policy and more than two dozen other trade associations sent a letter to Sen. Mitch McConnell (R-KY) urging the Senate to confirm EEOC nominee Janet Dhillon. The EEOC currently has only two commissioners, one from each party. The absence of a functioning majority has prevented it from taking any action to reconsider the Obama-era rules.
Outlook: Given the current uncertainty over the status of the EEO-1 report, employers are hoping for further guidance from the EEOC before implementing any changes to their HRIS and payroll systems.
