EEOC won't renew pay data collection after current cycle

Dive Brief:

The U.S. Equal Employment Opportunity Commission (EEOC) will not renew its request to collect employer pay data, also known as EEO-1 Component 2, according to a Notice of Information Collection published Thursday.
The notice will not affect the EEOC's collection of Component 2 data for the 2017 and 2018 calendar years that employers with 100 or more employees and certain federal contractors are required to submit to the agency by Sept. 30, it said in a statement. Further, the agency said it must seek a three-year approval on the extension of EEO-1 Component 1 demographic data collection from the White House's Office of Management and Budget (OMB). The EEOC said it intends to request this approval under a new control number, one separate from the control number under which Component 1 data collection for 2016, 2017 and 2018 — and Component 2 data collection for 2017 and 2018 — have been approved.
The EEOC said its Office of Enterprise Data and Analytics found the agency's method of calculating the burden of EEO-1 data collection on employers for its previous EEO-1 approval "insufficiently calculated" that burden. The agency has now developed a "more accurate" methodology estimating a higher burden, it said; it still intends to renew collection of Component 1 data despite this burden but it does not intend to do the same for Component 2. The notice is subject to a public comment period ending November 12.

Dive Insight:

The EEOC is revisiting the pay data collection issue months after a tumultuous period for Component 2. OMB blocked the agency's collection of Component 2 in 2017, but it wasn't until March 2019 that a federal district court judge's ruling effectively put the requirements back into effect by staying OMB's decision. After weeks in court, EEOC rolled out a plan to collect the data and opened a web portal to filers in July.

Now the future of that reporting is uncertain. The EEOC indicated that it hasn't entirely ruled out collecting pay data down the road, saying in the footnotes of its notice that, "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." The agency's quorum, which it needs for rulemaking, was restored in May following the confirmation of Chair Janet Dhillon, a Trump administration nominee.

The National Women's Law Center (NWLC), whose ongoing suit against OMB led to the reinstatement of Component 2 reporting, criticized the EEOC's decision in a statement Wednesday. "The Trump administration made it clear today that, if it were not for NWLC winning its pay data collection lawsuit, it would simply allow employers to continue to hide their wage gaps by gender, ethnicity and race," Fatima Goss Graves, president and CEO of NWLC, said in the statement. "This is outrageous."

Sen. Patty Murray, D-Wash., ranking member of the Senate Health, Education, Labor and Pensions Committee, called on the EEOC to reverse its decision in a tweet Thursday.

"This is probably the end, but not definitely," Robin Shea, partner at Constangy, Brooks, Smith and Prophete, said of Component 2 data collection in a statement emailed to HR Dive. "All of that said, I do expect that eventually the EEOC will be able to stop requiring employers to submit Component 2 data well before what would be the 2020 data submission deadline."

Management-side legal experts expected a "bumpy" execution of pay data collection, according to those who spoke with HR Dive, suggesting that few employers had prepared to cull their pay data despite the chance that a court could reinstate Component 2. In reality, filers likely have all the data they need available to them, and the process may be relatively straightforward if they know where to pull that data, sources previously told HR Dive.