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White House blocks Obama-era rule seeking pay data from employers

Jeff Jeffrey; Pacific Business News; August 31, 2017

A White House decision to block a rule requiring employers to report detailed pay data broken down by gender and race could save U.S. businesses more than $1 billion, according to the U.S. Chamber of Commerce.

The rule — enacted by President Barack Obama in 2016 — was designed to allow the U.S. Equal Employment Opportunity Commission to collect additional data that would then be used in efforts to address wage gaps. Business leaders, however, said it would have increased burdens on their companies.

Under existing rules, businesses are required to report on about 180 categories of data, including information about individual employees' gender and race or ethnicity. The new rule would have expanded the categories that businesses have to report to more than 3,600 categories, the U.S. Chamber of Commercesaid. The expanded form requires companies with more than 100 employees to provide summary pay data and aggregate hours worked data.

The new rule was scheduled to go into effect in March.

On Tuesday, the White House Office of Information and Regulatory Affairs directed the EEOC to stay the rule indefinitely. The office’s memo to the EEOC said the expanded reporting requirements “lack practical utility, are unnecessarily burdensome, and do not adequately address privacy and confidentiality issues.

The U.S. Chamber praised the decision, saying the EEOC’s estimate of the financial burden was significantly lower than actual cost. The EEOC estimated the rule would have cost businesses $53.5 million; the chamber’s estimate came to $1.3 billion.

“This is a commonsense decision by OIRA that restores credibility to the Paper Reduction Act process,” said Randy Johnson, the U.S. Chamber's senior vice president for labor, Immigration and employee benefits.

Acting EEOC Chair Victoria Lipnic, a Republican, said in a statement that the move to block the rule would not hamper the commission’s mission to enforce anti-discrimination laws.

“Going forward, we at the EEOC will review the order and our options,” Lipnic said. “I do hope that this decision will prompt a discussion of other more effective solutions to encourage employers to review their compensation practices to ensure equal pay and close the wage gap.

Lipnic, who was appointed to the five-member commission by President Obama, voted against the expanded reporting requirements last year.

Jeff Jeffrey is the digital producer for ACBJ's national news desk.
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