Fair pay is a top priority of President Biden’s administration. In his first year of office, Biden has signed executive orders on numerous employment matters to boost diversity and equity in the workforce. He also appointed Charlotte Burrows as chair of the EEOC, and Jenny Yang as director of the Office of Federal Contract Compliance Programs, signaling the administration’s intent to prioritize pay equity enforcement.
In this conversation with former commissioner and acting chair of the Equal Employment Opportunity Commission Victoria A. Lipnic, Felicia A. Davis and Emily R. Pidot of Paul Hastings LLP explore what employers should expect to see in terms of pay equity enforcement and other agency priorities under the new administration.
Pidot: What areas of focus do you think the EEOC and OFCCP will have in terms of their strategic initiatives over the next few years?
Lipnic: Several areas of focus come to mind. First, of course, pay equity is going to be prominent. Second, the Americans with Disabilities Act will be another enforcement priority for this administration.
The Biden administration on June 25 issued an executive order about diversity, equity, inclusion, and accessibility for the federal workforce. As a result, I wouldn’t be surprised to see many employers convert their “Diversity, Equity and Inclusion” initiatives into “Diversity, Equity, Inclusion and Accessibility” initiatives.
And third, the EEOC’s strategic enforcement plan, which prioritized equal pay and LGBT equality, among others, and which has been in place since 2017, expires this year. Employers should stay tuned for the EEOC’s new strategic enforcement plan, which will lay out a new group of enforcement priorities. I would not expect that to happen until 2022, since the current plan runs through the end of this year and the composition of the commission will change in 2022.
As far as new topics? Since the #MeToo movement there’s been a focus on increasing access to the justice system. Arbitration agreements and anything else that is perceived to have a chilling effect on access to the justice system might become a priority.
Pidot: Do you expect collaboration between the EEOC and OFCCP on their respective enforcement priorities?
Lipnic: Yes. Charlotte Burrows is chair of the EEOC, and Jenny Yang is the director of the OFCCP. Both Chair Burrows and Director Yang are committed civil rights activists. First and foremost, they are brilliant lawyers, and incredibly hardworking. They started their careers at the Department of Justice together. They have worked together for many years and have a similar view of the importance of government enforcement and the role that government can play in driving change and will take active roles in trying to drive change for their respective organizations.
I foresee some opportunities for collaboration on the equal pay front, especially because the EEOC is the enforcement agency under the Equal Pay Act. It would be fascinating to see them combine the OFCCP’s auditing capability and longstanding interest in compensation with the EEOC’s directed investigation authority under the EPA.
Davis: Do you have any insights on what we can expect going forward regarding reporting pay data to the EEOC?
Lipnic: Whether it is a revised EEO-1 Component 2 report, or some other type of regulatory requirement for employers to submit pay data to the federal government, I believe employers will be required to submit pay data to the federal government in the future. I do not see a scenario where that will not happen, given what the makeup of the commission will be in 2022 and Director Yang’s and Chair Burrows’ longstanding interest in equal pay.
Some have suggested that perhaps pay reporting requirements would only be for federal contractors. I don’t believe the requirements will be so limited. I expect that all employers will be required to report pay data to the federal government. The question will be what form does that take? Is it something like the Component 2 report, or does it look differently?
Aside from pay information though, there are several groups, particularly disability groups, who have expressed interest in having the EEO-1 Form revised to include a requirement to report disability status. That is certainly something to watch for as well.
Investigations and Audits
Pidot: At what stage does an investigation with the EEOC risk becoming public? What steps should employers take to maintain confidentiality, with respect to information provided during an investigation?
Lipnic: First, there is a statutory provision within Title VII that governs and requires confidentiality. The EEOC absolutely adheres to that. Typically, when an investigation becomes public, it is because the charging party has made it public, not because the EEOC has made an investigation public. When an investigation becomes public, the EEOC always says they cannot comment on an ongoing investigation.
On the other hand, there is always the Freedom of Information Act (FOIA). If someone is interested in getting that type of information, the public can always get the information via FOIA. It is important for employers to cite the FOIA provisions to protect information that they are turning over and review the FOIA exemptions under which information can be protected.
Davis: Now that employers are aware that federal agencies are going to be highly focused on pay equity, what should employers do to anticipate or prepare a defense to this wave of pay equity investigations?
Lipnic: Do a pay audit. Employers should do an internal pay audit and obtain privileged legal advice regarding their compensation programs and the current state of their workforce. Employers can start by looking at the Component 2 information submitted and compare that to their own internal analysis, because the groups may not be the same. That could provide an explanation if the EEOC shows up looking for more information.
Davis: If an employer conducts a privileged pay analysis, could you foresee the EEOC challenging that privileged designation?
Lipnic: Absolutely. Employers should very carefully review their privilege protocols because that challenge is almost certain.
This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.
Victoria A. Lipnic served as commissioner of the EEOC from 2010 to 2020, and as acting chair from 2017 to 2019. Today, Ms. Lipnic is a partner at Resolution Economics LLC and leads the Human Capital Strategy Group.
Emily R. Pidot is co-vice chair of the Employment Law practice of Paul Hastings, based in New York.
Felicia A. Davis is a partner in the Employment Law practice of Paul Hastings, based in Los Angeles.