Mar 16, 2016 - 8:00am

EEOC’s Massive Pay Data Form Won’t Help It Fight Discrimination

Senior Editor, Digital Content

In an effort to fight pay discrimination the Equal Employment Opportunity Commission wants to make employers fill out a massive pay data form.

Not only is it a massive recordkeeping burden—3,360 cells in a spreadsheet—but amassing that data won’t even help EEOC in fighting pay discrimination.

The EEOC has not “identified the specific benefit that the collection of aggregated wage and hours data would provide to the agency,” said Camille Olson, a lawyer for Seyfarth Shaw, testifying for the U.S. Chamber before the EEOC on Wednesday:

The EEOC has recognized that differences in education, experience, training, shift differentials, job classification systems, temporary assignments, “red circling,” revenue production, and market factors, to name a few, can legitimately explain compensation differences. Thus, mere differences in pay even as between comparable employees are insufficient to infer unlawful discrimination.

By lumping jobs into broad categories,

employers would be forced to categorize employees who perform wildly different work into these groupings. The job groupings are exceedingly broad, and will necessarily capture a wide range of positions that are not capable of meaningful compensation comparisons.

For instance, in a hospital both nurses and lawyers would be lumped together as “professionals.” But it’s as plain as day that these are very different jobs that require different education, skills and experience, and are therefore paid differently.  The EEOC’s proposal fails to account for these and other legitimate, non-discriminatory factors that affect employee pay. 

Also, if the data is collected, the statistical analysis EEOC will perform on it “may not identify actual pay differences that are consistent with discrimination when it truly exists, and may incorrectly conclude that there is evidence consistent with discrimination when employees are actually paid equivalently.”

In other words, the data could lead to both “false positives” and “false negatives” which may unfairly target certain employers and misdirect EEOC resources.

To sum it up, Olson said, “There is simply no circumstance under which broad-brush, aggregate compensation and hours data can be used effectively on a grand scale to target employers for review.” 

EEOC should not go ahead with forcing this paperwork monster on employers, but instead should use existing tools and information–such as its enormous backlog of charges–if it truly wants to address pay discrimination.

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About the Author

About the Author

Sean Hackbarth
Senior Editor, Digital Content

Sean writes about public policies affecting businesses including energy, health care, and regulations. When not battling those making it harder for free enterprise to succeed, he raves about all things Wisconsin (his home state) and religiously follows the Green Bay Packers.