January 30, 2015

ANOTHER PAY DATA COLLECTION? THE EEOC CONDUCTS PILOT STUDY

The EEOC is moving towards the collection of employee compensation data – albeit very quietly. Although no public announcements have been made, the EEOC is conducting a pilot study to investigate issues related to the collection and analysis of this data.

To some, this pilot study may seem unexpected – especially given the ongoing efforts of the OFCCP to move forward with the collection of pay data for Federal Contractors. That said, let’s look at some recent activity in the pay collection arena before discussing the (limited) details of the EEOC’s pilot efforts.

Historical Context

Movement towards the collection of pay data is several years in the making – going back to the Paycheck Fairness Act (PFA). As you may recall, one of the provisions of the PFA was a requirement for employers to provide the EEOC with information on pay by the race, gender, and national origin of their employees. The PFA, however, died in the Senate and was not enacted.  This spurred the White House to create the 2010 National Equal Pay Enforcement Task Force to address key pay-related issues. One notable recommendation from this taskforce was for the EEOC and OFCCP to identify ways to collect pay data from employers. Described below are the (seemingly siloed) efforts of the OFCCP and EEOC.

Initial EEOC Efforts

After receiving the White House taskforce recommendation, the EEOC asked the National Academies’ National Research Council to convene a panel to review methods for measuring and collecting pay information by gender, race, and national origin from U.S. employers. The panel was asked to consider “suitable data collection instruments, procedures for reducing reporting burdens on employers, and confidentiality, disclosure, and data access issues.” In 2012, the National Academies released a report, Collecting Compensation Data from Employers, which included the following recommendations:

  • The OFCCP, DOL, DOJ, and EEOC should prepare a comprehensive plan for use of earnings data before initiating any data collection.
  • After completing the comprehensive plan for use of earnings data, the agencies should initiate a pilot study to test the collection instrument and the plan for the use of the data.
  • The EEOC should enhance its capacity to summarize, analyze, and protect earnings data.
  • The EEOC should collect data on rates of pay, not actual earnings or pay bands, in a manner that permits the calculation of measures of both central tendency and dispersion.
  • The EEOC should consider implementing appropriate data protection techniques, such as data perturbation and the generation of synthetic data to protect the confidentiality of the data.
  • The EEOC should seek legislation that would increase the ability of the agency to protect confidential data.

 

OFCCP Efforts

After receiving the White House taskforce recommendation, the OFCCP also launched their own initiative, separate from EEOC’s work. In August 2011, The OFCCP released an Advance Notice of Proposed Rulemaking (ANPRM) for a new Compensation Data Collection Tool. After public comment and review, this was followed by a Notice of Proposed Rulemaking (NPRM) to Collect Summary Compensation Data from Contractors in New Equal Pay Report (“Equal Pay Report”), released in August 2014 (recently discussed on this blog). This proposed rule would require federal contractors who have more than 100 employees, and who hold federal contracts or subcontracts worth $50,000 or more for at least 30 days, to submit summary employee pay and demographic data to the OFCCP. DCI, in conjunction with the OFFCP Institute, submitted public comments in response to the proposed rule notice highlighting issues and considerations related to the collection and analysis of pay data. Publication of the final rule is anticipated in late August 2015, with a likely effective date in 2017.

Current EEOC Pilot Study

Now, back to the EEOC pilot study. Although the EEOC is taking the National Academies’ recommendation to conduct the pilot study, little is known regarding their current effort. The EEOC has not publicly discussed this contract nor their plans related to the collection of employee compensation data. What we do know is that in September 2014, the EEOC obtained contractor services from Sage Computing Inc., a social science research and information technology company headquartered in Reston, VA. The contract summarized the work as “conduct a Pilot Pay Study for how compensation earning data could be collected from employers for the EEOC.” Perhaps the completion of the pilot study contract (whose current estimation of completion is September 2015) will shed some light on the situation.

What does this all mean?

In conclusion, it looks as if both the OFCCP and EEOC are pursuing efforts to identify ways to collect pay data from employers. However, given the different stages of their efforts – EEOC in a pilot study and OFCCP reviewing public comments (with an assumed outcome of releasing a final rule) – it will be interesting to see how it plays out. Without clear communication between the regulatory agencies, it is also unlikely the two efforts will be complementary. In fact, it is more likely that the two efforts will result in two different data collection requirements – which would further impact Federal Contractors.

We will provide additional updates as information becomes available. Stay tuned.

In the meantime, we recommend reviewing Law360 for another discussion on the EEOC’s pilot pay study.

By Amanda Shapiro, M.S., Senior Consultant and Emilee Tison, Ph.D., Consultant, DCI Consulting Group

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