The Trump administration is about to roll back EEOC regulations that would have added millions of hours and hundreds of billions of dollars in compliance costs to American business.
The rules would have forced business to report 20 times as much data on employees as they do now. The ostensible reason for the massive increase in regulations was to make the workplace more diverse and solve the problem of gender pay inequity.
Not included in the new rules was an explanation of how this massive amount of data would improve diversity by one iota and reduce the gender pay gap by a single penny.
OMB issued the stay because of its concerns that the new forms would prove “unnecessarily burdensome” on businesses, while not achieving its desired goal of eliminating purposeful discrimination. It also said the EEOC rules could invade the privacy of individual workers without adequate protections in place.
“OMB is concerned that some aspects of the revised collection of information lack practical utility, are unnecessarily burdensome, and do not adequately address privacy and confidentiality issues,” Office of Information and Regulatory Affairs Administrator Neomi Rao said in an Aug. 29 memo.
The agency conducted a review of the rules, but did not provide all of the specifics of its data collection methods during public comment period to get feedback from employers. OMB said the EEOC’s omission could have led it to vastly underestimating the costs associated with adding nearly 3,500 new data points to the existing forms. The agency estimated the new regulations would cost employers $53.5 million and take about 1.9 million hours to complete. Those numbers paled in comparison to the findings of a survey conducted by the Chamber of Commerce, which estimated the regulations would cost $400 million and increase work hours by 8 million—if additional overhead is taken into account the rules could cost up to $1.3 billion.
“The public did not receive an opportunity to provide comment on the method of data submission to EEOC. In addition, EEOC’s burden estimates did not account for the use of these particular data file specifications, which may have changed the initial burden estimate,” the memo said.
The Chamber of Commerce said that the EEOC did not do its due diligence to assess the cost associated with the rule.
“The fact that the burden estimates were so defective was particularly unacceptable given the lack of utility of the information being collected by EEOC,” Chamber Senior Vice President Randy Johnson said in a release.
This is government meddling at a mind-boggling level. And it’s not like the EEOC doesn’t have enough to do already. Currently, there are 73,000 claims of discrimination filed with the agency, representing a backlog of several years.
The administration rollback of the regulatory state has been astonishing. They have unshackled the energy industry, canceled or delayed hundreds of Obama-era rules, and now plan to relieve business of a huge and unnecessary compliance burden.
It’s a good start.