Written Testimony of Jocelyn C. Frye Senior Fellow, Center for American Progress

Hearing of March 16, 2016 - Public Input into the Proposed Revisions to the EEO-1 Report

Good morning and thank you for the opportunity to participate in today's public hearing to discuss proposed revisions to the Employer Information Report, also known as the EEO-1 form. My name is Jocelyn Frye and I am a Senior Fellow at the Center for American Progress (CAP or the Center). The Center is a non-partisan think tank committed to improving the lives of all Americans, through bold, progressive ideas, as well as strong leadership and concerted action. CAP's Women's Initiative works to elevate and move forward public policy solutions that advance women's opportunities to be full participants in our society and equal contributors to our nation's success. To accomplish this work, we recognize the importance of promoting women's economic security as a strategy for strengthening the economic stability of working families and our overall economic growth. We are deeply committed to promoting policy solutions that help ensure both women and men are paid fairly in the workplace, and believe the new EEO-1 proposal represents a critical step forward in support of the Equal Employment Opportunity Commission's (EEOC's) important mission to promote equal employment opportunity. We enthusiastically support the pending proposal under discussion today and urge you to move forward expeditiously to finalize it as soon as possible.

INTRODUCTION

The goal of achieving equal employment opportunity is deeply rooted in our nation's values and commitment to equality, fairness, and equal justice under law. Ensuring that every individual is treated fairly and does not face discrimination based on race, gender, ethnicity, or other characteristics when they are looking for work or moving into the workplace serves as the cornerstone of our federal employment discrimination laws. But breathing life into these protections demands an equal commitment to ensuring that the spirit of the words enshrined in our laws are experienced concretely in the lives of everyday people - and that commitment requires vigorous civil rights enforcement.

Nowhere is the need for strong enforcement more critical than in the area of pay discrimination which is consistently identified by women as a top concern. Pay discrimination can be stubbornly difficult to uncover - it typically is hidden from view and employees can work for years without knowing that another employee doing the same or equal work is being paid more or less. Employees have very few tools to figure out whether they are being paid less than another work colleague, and in some workplaces they may be subject unfairly to rules that prohibit them from asking questions about their pay. In this environment, federal enforcement efforts to combat discriminatory pay practices are crucial. Yet, a key gap in the enforcement toolbox that has hampered federal equal pay enforcement efforts is limited access to pay information. The EEOC and the Department of Labor's Office of Federal Contract Compliance Programs (OFCCP), both of which have different equal pay enforcement obligations within their jurisdictions, can review compensation data after they decide to investigate a specific case or employer. But, they largely lack the ability to use pay data at an earlier stage to inform decisions about where targeted enforcement efforts might be needed or most fruitful, to undertake a more comprehensive look at pay practices to discern trends or specific problem areas across occupations or industries, or to assess how individual employers compare to broader, aggregated data about employer practices. Such information could provide invaluable insight into pay practices overall and indicate where greater enforcement is needed. The pending proposal to collect pay data using the EEO-1 form would address this problem head-on and help accomplish several important objectives:

• Provide federal enforcement officials with much-needed and important information about workplace pay practices.
• Strengthen women's ability to achieve economic security and provide support to their families by creating greater accountability in pay practices.
• Focus greater attention on combatting persistent pay disparities experienced by women of color by helping to identify occupational categories and/or industries where these problems occur the most.
• Examine trends in particular occupations and industries that can help isolate problems and surface the need for broad-based or systemic policy solutions.

All of these objectives are important enforcement priorities and are critical to creating workplaces where all workers have a fair chance to thrive and succeed.

1) Pay Data Collection is Critical to Strengthening Enforcement of Equal Pay Laws

Vigorous enforcement of equal pay laws is vitally important to creating workplace environments that foster fair pay practices and operate free of discrimination. Federal enforcement agencies charged with the responsibility of administering and implementing federal equal pay protections must have the full complement of tools and resources at their disposal to fulfill these obligations. Pay discrimination, as already noted, is often difficult to uncover because of longstanding workplace cultural attitudes that discourage discussions about pay or how pay decisions are made. In such an environment, victims of pay discrimination can be completely unaware that they are being paid less than another employee doing equal work. And, even if they suspect they are being paid unfairly, they may have little or no information or no other mechanism to figure out what is occurring behind the scenes.

Federal enforcement agencies need access to the full complement of enforcement tools necessary to ensure robust enforcement of employment discrimination laws. Federal enforcement agencies such as the EEOC and OFCCP, respectively, are uniquely positioned and tasked with investigating discrimination claims and monitoring compliance with the key employment discrimination laws. The EEOC is charged with the responsibility of investigating individual complaints alleging pay discrimination in employment under laws such as the Title VII of the Civil Rights Act of 1964¹ and the Equal Pay Act,² which often are the primary vehicles used to file pay discrimination claims. The Department of Labor is empowered to ensure that federal contractors comply with the antidiscrimination protections enshrined in Executive Order 11246, which prohibits discrimination in employment - including pay - based on race, color, religion, sex, sexual orientation, gender identity, and national origin.³ Thus, both agencies play their own unique role in examining employer pay practices to determine whether discrimination has taken place. To do this work effectively, they need resources - not only the availability of investigators and enforcement staff, but also access to the necessary information and enforcement tools critical to evaluating whether discrimination has occurred. Access to pay data, which can be used to identify pay differences across different job categories broken down by race, gender, and ethnicity, is one such tool that can strengthen the ability of enforcement agencies to understand workers' experiences and help direct how their limited enforcement resources can be deployed for maximum effectiveness.

More data needed to investigate pay discrimination allegations and root out discriminatory practices. Collecting pay data is vital to the task of uncovering pay discrimination. The pending proposal would provide enforcement officials with pay data broken down by race, ethnicity, and gender across 10 job categories. The pay data in each job category would be further refined using 12 pay ranges (or bands) to show general pay differences within each job category. Establishing the existence of a pay difference is one of the key threshold facts needed at the outset of an investigation to show that there is merit in looking further to determine whether a pay difference actually violates the law.⁴ The simple fact that a pay difference exists is not per se proof of discrimination, but information about pay differences is essential to laying the evidentiary foundation that is ultimately needed to prove that discrimination has taken place. Without access to pay data early on, enforcement agencies have far less information to make informed decisions about how best to tackle discriminatory pay practices. Once the proposal is implemented, enforcement agencies will be better positioned to use the data collected to gain a better understanding of why a pay difference has occurred and determine whether more examination is required.

Proposed data collection strikes the proper balance to fulfill enforcement needs without imposing unreasonable burdens on employers. The need for better tools to combat pay discrimination has been a longstanding concern, and the effort to devise a tool to collect pay data from employers has been a hotly debated topic of conversation for years. Some employers have resisted previous data collection efforts, arguing that the burden of having to create new systems and train employees to complete a new form and gather new data was too great. The pending proposal responds directly to many of these concerns - it makes use of a familiar form that many employers already have to submit each year and modifies it to collect pay information, and it limits its focus to gathering information about pay without expanding to other issues. At the same time, the proposal makes clear that its core purpose - to gather pay data from employers - is an important priority that is essential to enforcing equal pay laws.

2) Better Information about Pay Differences is Essential to Identifying Policy Solutions to Reduce Pay Discrimination and Improve Women's Economic Security

The pending proposal is an important step forward towards strengthening the economic security of working families. Women increasingly are playing a central role in helping their families achieve economic stability. More than 6 out of 10 mothers are co-, sole, or primary breadwinners for their families, meaning that their economic support is needed to make ends meet.⁵ At the same time, women continue to experience a gap in their average earnings when compare to their male counterparts. In 2014, women earned 79 cents for every dollar earned by men.⁶ Such pay differences can lead to reduced financial resources for families and create or exacerbate financial hardships for those families most in need. In an economic environment where persistent wage stagnation and growing inequality have strained the economic stability of many working families across the country, there is a pressing need for policy solutions that can help improve wages and strengthen the earning power of both women and men. Combating pay discrimination and closing the gap between women's and men's earnings, thus, are not merely important for women, but also vital for families trying to stay afloat. The pending proposal addresses one component of the wage gap⁷ by combating discriminatory pay practices that can depress women's earnings. In doing so, the proposal may help promote greater accountability in pay practices by incentivizing employers to review their pay practices more regularly and correct problems when they arise.

3) More Information about Pay Differences Can Help Tackle Wage Disparities Experienced by Women of Color

Expanding access to pay information is particularly important to better understand where pay differences are occurring, and to help provide a roadmap for a more in depth analysis of the reasons behind these pay differences. Gaining a deeper understanding of pay disparities is important for all workers, but particularly women of color, who experience the largest pay gaps. While the pay gap for women overall stands at 21 cents, the gap is even larger for many women of color - in 2014, African American women earned 60 cents for every dollar earned by White men, Native American women earned 59 cents for every dollar earned by White men, and Latinas earned 55 cents for every dollar earned by White men. Asian American and Pacific Islander women also earned less than White men - 84 cents for every dollar - but with significant variations among sub-populations, such as Vietnamese women who earned 62 cents for every dollar earned by White men.⁸

Too often, the unique challenges facing women of color get lost in the broader equal pay conversation because there is a lack of information beyond the basic data documenting the wage gap. But, more analysis can be undertaken to examine whether there are specific job categories that pose the most problems, or at least provide some insight into where to look further to figure out where problems exist. The data gathered through the EEO-1 form can be an important tool - it has been used, for example, to document where women of color are employed across the private sector.⁹ Such information can help chart progress but also show where work is still needed. The inclusion of pay data on the form now will allow for an even more nuanced understanding of the experiences of women of color at work and may help identify what type of corrective enforcement strategies could be most effective or useful.

4) More Information about Pay Differences Can Help Isolate Specific Job Categories Where Disparities May be Most Pronounced

The EEO-1 form historically has played an important role in helping to identify disparities in who gets certain jobs and who does not.¹⁰ The EEO-1 form was first put into practice during the Commission's earliest years as a tool used to pinpoint discriminatory practices in different industries or jobs. The information gathered was vital to surfacing patterns of discriminatory conduct, and helped form the basis for hearings to explore the findings of the research in more depth. Today, the form continues to be used to shed light on discriminatory workplace practices. The proposed enhancements to the EEO-1 form will allow for more detailed information about pay differences across different job categories, particularly in low-wage jobs where workers may be less well-positioned or empowered to surface or redress pay disparities. This information also may help expose other types of pay discrimination that often receive less attention, such as pay discrimination facing men, workers with disabilities, or women from the LGBT community. Better information can be used to educate employers, supervisors, managers, and employees about the diverse ways pay discrimination may arise and promote greater awareness of discriminatory attitudes and practices.

CONCLUSION

Meaningful and robust enforcement of our nation's equal pay laws requires an unflinching commitment to securing and utilizing the full range of enforcement tools needed to uncover and combat pay discrimination. The collection of pay data is a long-overdue tool that is critical to identifying pay disparities and maximizing our ability to better target our federal equal pay enforcement efforts. The pending proposal appropriately balances the needs of enforcement officials and business while still collecting the pay information that can improve our understanding of pay differences at a time when improving wages is critical for working families. We strongly urge the Commission to finalize the pending proposal as quickly as possible to move us closer to making the promise of equality a reality for all workers.

Thank you for the opportunity to participate in today's discussion.

Footnotes

¹ Title VII of the Civil Rights Act of 1964, 42 U.S.C. §2000e, et. seq. (Title VII).

² Equal Pay Act of 1963, 29 U.S.C. §206(d).

³ Executive Order 11,246, As Amended, 30 F.R. 12319, 12935 (1965).

⁴ See generally, EEOC Compliance Manual, Section 10: Compensation Discrimination, (U.S. Equal Employment Opportunity Commission, 2000), available at http://www.eeoc.gov/policy/docs/compensation.html.

⁵ Sarah Jane Glynn, "Breadwinning Mothers, Then and Now," (Washington: Center for American Progress, 2014), available at https://www.americanprogress.org/article/breadwinning-mothers-then-and-now/.

⁶ Carmen DeNavas-Walt and Bernadette Proctor, "Income and Poverty in the United States: 2014," (U.S. Census Bureau, 2015), Figure 2, available at https://www.census.gov/content/dam/Census/library/publications/2015/demo/p60-252.pdf.

⁷ Leading experts who have studied the gender wage gap in depth make clear that the gap is driven by multiple factors, including hours worked, time out of the workforce, occupational segregation, and discrimination. Francine D. Blau and Lawrence M. Katz, "The Gender Pay Gap: Have Women Gone as Far as They Can?" in Academy of Management Perspectives (2007) 21, pp. 7-23, http://inequality.stanford.edu/_media/pdf/key_issues/gender_research.pdf.

⁸ National Women's Law Center, "Equal Pay for Asian American Women," (Washington: National Women's Law Center, 2016).

⁹ U.S. Equal Employment Opportunity Commission, "Women of Color: Their Employment in the Private Sector," available at

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¹⁰ U.S. Equal Employment Opportunity Commission, EEOC History: 35th Anniversary 1965-1971, "Early Enforcement Efforts," available at http://www.eeoc.gov/eeoc/history/35th/1965-71/early_enforcement.html.