Employers are Optimistic About Pro-Business Changes at the EEOC

By Jennifer A. Dunn and Melissa D. Sobota - Franczek Radelet P.C.

October 26, 2017

Employers are hopeful that, with the confirmation of President Trump’s nominees for the Equal Employment Opportunity Commission, the agency will adopt a more business-friendly approach to the issues before it. Employers are looking for changes to several Obama-era regulations, including the elimination of the Pay-Gap Disclosure Rule, changes to the EEOC’s stance on LGBT employee protections, and approval of employer wellness incentive programs. The Senate is expected to confirm both nominees soon.

Janet Dhillon, who has been nominated to chair the EEOC, served as the general counsel for J.C. Penney, U.S. Airways Group, and Burlington Stores. Daniel Gade, who has been nominated to serve as an EEOC member, is an Iraq war veteran and former policy advisor for the George W. Bush White House. Gade has been an outspoken critic of disability pay for wounded veterans and has spent the last several years making clear his belief that the Department of Veterans Affairs should offer incentives rather than disability checks to wounded veterans.

During their confirmation hearings, both Dhillon and Gade stated that addressing the Obama-era Pay-Gap Disclosure Rule would be a priority. In August, the Trump Administration’s Office of Management and Budget froze the Pay-Gap Disclosure Rule; if unfrozen, the rule would require large employers to disclose data on workers’ wages broken down by gender and ethnicity. It is likely that with the appointment of Dhillon and Gade, the EEOC will either significantly limit the data sought by this rule or not seek mandatory data collection at all.

The EEOC may also move away from its prior position on LGBT protections, including its position that workplace bias based on sexual orientation or gender identity is a form of unlawful sex discrimination. During the confirmation hearing, Dhillon stated that she “think[s] it’s critical that the federal government ultimately speak with one voice on how this statute is appropriately interpreted.” As we previously reported, the U.S. Department of Justice has taken the recent position that Title VII does not protect transgender individuals from employment discrimination. The EEOC may likely follow suit and reverse course on the issue of LGBT protections in the workplace under Title VII.

Finally, it is expected that the EEOC will revise regulations allowing companies to offer employee discounts on health insurance premiums if employees participate in voluntary wellness programs. In August, a federal judge halted the EEOC’s regulation allowing such wellness programs, but Dhillon said that she would make it a priority “to redo those regulations to comply both with congressional intent and obviously the court’s direction as well.”

It remains to be seen exactly what policies or regulations will be targeted first by the new EEOC, but it is expected that there will be a significant change in the EEOC’s direction with the new members’ confirmation. We will continue to follow the developments at the EEOC and provide updates as changes develop.