So now that you’ve all had a chance to review the OFCCP’s Advanced Notice of Proposed Rulemaking on the compensation data collection tool, let’s talk about the specifics of what data they may be requesting, and what kinds of burdens on contractors and on OFCCP this data may impose.

(If you haven’t seen the ANPRM, you can read it here, or head over to Carla Irwin’s blog, AA Insights - she’s got a great summary of the questions on which the OFCCP is seeking comment.)

OFCCP is contemplating collecting the following data, some of which would be at a very granular level:

- average starting or initial total compensation (including paid leave, health and retirement benefits, etc.);
- average pay rates;
- average bonuses;
- minimum and maximum salary;
- standard deviation or variance of salary;
- the number of workers in each gender and race / ethnicity category;
- average tenure;
- average compensation data by job series;
- total W-2 earnings;
- base salary;
- holiday pay;
- hourly wage;
- shift differential;
- commissions;
- stock options;
- paid leave;
- health benefits;
- retirement benefits;
- other elements of compensation.

Employers would be required to produce this data separately for each job category. Possible candidates for job categories include two or three-digit Standard Occupational Classification Codes, salary bands within EEO-1 categories, and individual job titles.

In addition, employers may also have to produce their policies and procedures for initial pay setting, shift pay, bonus decisions, promotion decisions, and any other decisions impacting compensation.

The data collection tool may encompass more than 18 different kinds of compensation data. OFCCP recognizes that this could create significant reporting burdens for contractors, as well as analytic burdens placed on the Agency.

I think OFCCP may be underestimating the potential analytic burdens and is likely trying to bite off more than it can chew. As I mentioned yesterday, examining compensation data with respect to gender or race/ethnicity discrimination is not an easy process. It requires a detailed understanding of how individuals within the organization are compensated and why similarly situated employees may be compensated differently.

It seems a near impossibility that OFCCP will have the analytic resources to gain that understanding and construct a tailored analysis for each and every contractor. It’s more likely that a generic model will be built, assuming that the Agency has the resources to employ multiple regression analyses. In all probability, multiple regression analysis will be discarded in favor of the “broad Title VII principles” methodology that OFCCP keeps referencing, particularly in connection with the proposed rescission of the compensation standards and guidelines.

I encourage you to think about the potential reporting burdens for contractors and the analytic burdens for the Agency that this compensation data collection tool could impose, and to submit your comments to OFCCP before October 11th.