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Judge rules that companies must disclose employees' pay broken down by sex, race, and ethnicity


Ruling overturns a move by the Trump administration to halt the policy

Oli Scarff/Getty Images

A federal judge ruled Monday that any company with more than 100 employees has to report the sex, race, and ethnicity breakdown of employees in each pay bracket.

What are the details?

During the final months of the Obama administration, the Equal Employment Opportunity Commission determined that companies had to reveal the demographics of each pay bracket. The Trump administration put a stop to the new policy in August 2017, arguing that it was too much of a burden for the companies.

However, District Court Judge Tanya S. Chutkan ruled Monday that the Trump administration did not properly justify its decision, Bloomberg reported. In her decision, she wrote that the administration had failed to prove that the new regulations would "meaningfully increase the burden on employers."

According to Bloomberg, employers previously had to submit a single page of demographic data to the EEOC every year. Now they will have to submit 10 pages. The EEOC estimates that this will cost all U.S. businesses collectively about $53 million a year. The U.S. Chamber of Commerce disagrees, and puts the cost in excess of $400 million.

Michael Eastman, senior vice president with the Center for Workplace Compliance, told Bloomberg that the data required by the new rule was "kind of in the weeds, really technical detailed stuff."

These new rules will apply only to companies with more than 100 employees.

What else?

The EEOC argued that the system would force companies to "look under the hood" and see how they treat their own employees.

All the data gathered will be confidential between the business the EEOC, but once it exists, activists could pressure companies to make general demographic information public. The EEOC would publish aggregate data to show overall trends throughout corporate America.

The rule would have originally required companies to have this information ready by March 31, 2018. It's not clear yet when the EEOC will require these forms now since the rule was suspended for so long.

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