Trump Administration Stops Collection of Data that Could Reveal Pay Discrimination Practices

Published Mar 6, 2020

What happened: The Equal Employment Opportunity Commission (EEOC) is nixing the collection of worker’s pay data, sorted by race, sex, ethnicity, and job category, from businesses with over 100 employees. The 2016 rule establishing the yearly pay data collection was intended to provide a wealth of information on potential pay gaps for women and people of color and aid enforcement efforts on equal pay laws. The EEOC said that it won’t renew its pay data collection efforts because the cost to employers was much higher than originally estimated and that the pay data had “unproven utility.”

Why it matters: Scientific evidence shows that women and people of color are paid less than men and white people. Therefore, federal data collection efforts on this issue could prove invaluable in shedding light on pay discrimination and aid federal efforts to reduce this inequity. When federal agencies fail to collect data, it stymies efforts to enact evidence-based decisionmaking and enforcement efforts. In this case, such data collection could reduce the discriminatory burdens often placed on vulnerable populations.

The Equal Employment Opportunity Commission (EEOC) is stopping the practice of collecting annual pay data, sorted by various demographics, from US businesses that represent an estimated 63 million workers. The collection of pay and hourly worked data, sorted by demographic categories of sex, race, ethnicity, and job category, has so far only occurred for 2017 and 2018. Worker advocates believe this data could prove particularly useful in revealing trends and providing results that could aid efforts to achieve equal pay for women and people of color. However, the EEOC came to the decision to nix the data collection, because the high costs to businesses outweighed the “unproven utility” of the pay data, before the agency had fully collected or analyzed the data.

Scientific evidence suggests that women are paid 82 cents for every dollar paid to men, a trend driven in part by gender and racial discrimination, workplace harassment, job segregation, and a lack of workplace policies that support family caregiving, which is still most often performed by women. Women of color are particularly affected. Among women of color working at full-time, year-round jobs, Black women are typically paid 62 cents; Indigenous women are paid 58 cents; and Latinas are paid 54 cents for every dollar paid to white men. Due to this pay discrimination, women – particularly women of color – typically have less money to support themselves and their families, including for basic necessities such as healthcare, food, and housing.

The Trump administration has had a contentious relationship with the EEOC’s pay data collection requirement. EEOC’s collection of pay data by businesses with more than 100 employees was implemented under a 2016 update of the EEOC’s Employer Information Report form which was initially approved by White House’s Office of Management and Budget (OMB) under the Obama administration in September 2016. However, the Trump administration blocked this policy from going into effect when businesses said that the requirements would be too burdensome. In August 2017, the Trump administration’s OMB suspended the pay data collection, leading to a lawsuit in November 2017 from worker rights organizations like the National Women's Law Center and the Labor Council for Latin American Advancement.

In March 2019, a federal court reinstated the pay data collection for the calendar years 2017 and 2018. The federal court determined that the OMB did not provide a “reasoned explanation” for its hold on the data collection and that this action was determined by the court to be “arbitrary and capricious.” In November 2019, the Trump administration’s Department of Labor weighed in, saying that it won’t accept the court-ordered pay data from the EEOC because they claimed that the information wasn’t necessary for the Department of Labor to flag potential discrimination at federal contractor worksites. EEOC complied with the federal courts and, in February 2020, with 89 percent of eligible businesses handing over the required data, the courts determined that the EEOC’s collection of 2017 and 2018 federal pay data was completed. However, EEOC and the White House’s OMB is still appealing the federal judge’s decision, claiming that the judge overstepped her authority by reviving the pay reporting requirement and dictating how and when the data collection should occur. But with the EEOC’s notice in the federal register that it will not renew the requirement to collect this pay data for 2019 and beyond, there is concern from equal pay advocates that EEOC will do little with the pay data collected from 2017 and 2018, such as failing to analyze the data at all. Furthermore, advocates believe that this action will send a broader message to employers about the EEOC’s commitment (or lack thereof) to investigate and tackle the issue of unequal pay.

The EEOC is an agency whose primary purpose is to enforce the federal laws that make it illegal to discriminate against a job applicant or an employee on basis of certain demographic factors, such as race and gender. Normally, the agency carries out its mission through the investigation of employee complaints, but the pay data could have provided the EEOC with an important tool that identified pay discrimination for women and people of color and allowed the EEOC to proactively spot potential warning signs of pay discrimination that may be worth investigating. When our federal agencies fail to collect data that is pertinent for carrying out their duties, the agencies can’t know if or where a problem is occurring, let alone create evidence-based strategies to manage the problem. And considering the devastating impact that pay discrimination has on women and people of color, the EEOC’s failure to collect pay data only exacerbates the problem and prevents the agency from enacting evidence-based policies to combat it.