U.S. District Judge Tanya Chutkan at her confirmation hearing. Photo by Diego M. Radzinschi / NLJ

A Washington federal judge on Tuesday scolded government attorneys for the delay in implementing a court order that reinstated Obama-era rules requiring employers to provide new workforce compensation data on annual reports.

At a hearing, U.S. District Judge Tanya Chutkan told U.S. Justice Department lawyers and the U.S. Equal Employment Opportunity Commission that they must provide her a timeline on their plans to comply with her March 4 order.

Chutkan’s ruling this month forces employers with more than 100 workers to provide a breakdown of compensation data based on gender, race and ethnicity. Business advocates had resisted the new pay-data collection rule as burdensome and potentially open to misinterpretation.

The deadline for submitting the new pay information is May 31, but the Justice Department and EEOC have not said whether they plan to appeal Chutkan’s order. The EEOC on Monday opened a portal in which employers can submit annual reports, called the EEO-1, but the agency did not provide a mechanism for submitting the new pay information.

The EEOC has indicated it was “working diligently on next steps in the wake of the court’s order” and said it would provide “further information as soon as possible.”

“The longer you wait, the longer it will take for employers to comply,” Chutkan said at Tuesday’s hearing in Washington’s federal district court. “The briefing in this case was expedited because of the time constraints.” She added: “You have had two weeks. You’re still saying, ‘Let’s wait and see.’ Why? That doesn’t make sense to me.”

The Trump administration, cheered by the business community, scuttled the Obama-era pay-data rule last year, and the move led to a lawsuit by the National Women’s Law Center and Democracy Forward Foundation.

Chutkan called the effort to stop implementation of the rule, led by Neomi Rao, who was recently confirmed to the U.S. Court of Appeals for the D.C. Circuit, an unlawful administrative action. Rao formerly led the Office of Information and Regulatory Affairs.

Neomi Rao testifies before the Senate Judiciary Committee. Credit: Diego M. Radzinschi / NLJ

Chutkan’s ruling has created uncertainty for employers, even if the judge noted that companies “were on notice that the stay could be withdrawn at any time.”

Klair Fitzpatrick, a Morgan, Lewis & Bockius employment partner in Philadelphia, said in a recent interview that clients were preparing to comply with the changes, even though they believe they impose “burdensome requirements and have the potential to be misused.”

On the flip side, Jenny Yang, a former Obama-era EEOC commissioner, said recently that “pay data collection is long overdue.”

Chutkan set Tuesday’s hearing quickly after the plaintiffs raised questions about the EEOC’s compliance with the judge’s order. The plaintiffs said government lawyers had shown an “inability or unwillingness to provide any information about their plans” to comply with Chutkan’s reinstatement of the Obama-era rules.

Further delay in implementing the new pay-data rule “risks logistical difficulties and gaps in employer compliance,” the plaintiffs said in a court filing.

Justice Department attorney Tamra Moore told the judge that employers were only prepared to provide the data typically required every year and the agency was preparing its systems to ensure it could take in and process the new information. Chutkan said the government should have been better prepared in the event it lost in court.

Moore said it was possible the EEOC would not require employers to submit the new information by May 31. Chutkan said she did not want to order a specific deadline and allow the agency to set its schedule, but she ordered the government to provide her a more concrete plan about its next steps.

“I want to hear more than you are ‘working diligently,’” Chutkan said. “I realize there are issues and employers find this burdensome but they need guidance.”

Chutkan added: “I am not in the business of running the EEOC nor do I want to set an unrealistic deadline. I can, but I don’t think you want me to do that.”

The government has until April 3 to provide Chutkan with information about how it plans to comply with her order.

 

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