EEOC may propose pay data collection rule in 2020

Dive Brief:

The U.S. Equal Employment Opportunity Commission (EEOC) may adopt pay data reporting requirements for employers via rulemaking, it announced in its fall regulatory agenda Nov. 20. The agency said it expects to publish an advance notice of proposed rulemaking (ANPRM) in September 2020 with a two-month-long comment period to follow.
In assessing a potential pay survey, EEOC said it will consider the findings of a report it commissioned from the National Academy of Science, which examined "the potential benefits and burdens of collecting pay data from employers." These include "preparing a comprehensive plan for use of compensation data, ensuring that the data collection will enhance the EEOC's enforcement efforts, and assessing the EEOC's capacity for the collection and analysis of the data." Additionally, the agency said it intends to learn from states and localities that have enacted pay data collection.
In a separate agenda item, EEOC also announced plans to issue a notice of proposed rulemaking next month concerning how it defines joint employment status.

Dive Insight:

EEOC has faced many obstacles in its recent pursuit of pay data reporting requirements. Its journey began when it decided to add a compensation component to its EEO-1 forms, which employers had been submitting annually to disclose workforce demographic data. It obligated employers to report pay data with a new component — Component 2.

After President Donald Trump took office, the White House's Office of Management and Budget (OMB) blocked Component 2, kicking off a series of complications. The National Women's Law Center sued OMB and EEOC, which led to Component 2's reinstatement. EEOC collected Component 2 data this year but announced that it would not renew the request.

Still, the commission has remained dedicated to enforcing pay equity, something that pay data reporting would bolster, EEOC Commissioner Charlotte A. Burrows said at a recent conference.

It may come as little surprise that the agency has chosen rulemaking as its next avenue for this pursuit. The idea appeared in the footnotes of the notice the agency published when it announced its decision not to collect pay data in the 2019 calendar year: "If the EEOC seeks to pursue a pay data collection in the future it will do so using notice and comment rulemaking and a public hearing pursuant to Title VII of the Civil Rights Act of 1964." What's more, EEOC Chair Janet Dhillon voiced support for such a requirement during her hearing in 2017 and, much more recently, said a rulemaking is, in her view, "what should have been done in 2016, to allow for a robust public comment and input into how we craft pay data collection" without creating an undue burden.

Though the intent behind EEOC's most current pay data move appears fairly clear, employers must await the details of the ANPRM until its release.