Artificial Intelligence

Keeping up with the EEOC: 10 key takeaways from its just-released draft strategic enforcement plan

January 13, 2023
Beth C. Sumner

January 13, 2023

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The U.S. Equal Employment Opportunity Commission (“EEOC”) has released a draft Strategic Enforcement Plan for 2023-2027 (the “SEP”) that outlines its priority areas and enforcement goals.[1]Within these priorities, the SEP identifies a number of emerging issues, including artificial intelligence (“AI”), the recently enacted Pregnant Fairness Act of 2022 (“PWFA”), and ongoing issues related to the COVID-19 pandemic. The draft is open for comments until February 9, 2023 to gather further input from stakeholders.

10 key insights for employers

  1. Artificial Intelligence (AI): The EEOC plans to focus on using AI tools in recruitment, selection, hiring, promotion and other employment decisions. Since the launch of its algorithmic fairness initiative in October 2021, the EEOC has increased its focus on AI. For example, in May 2022, the EEOC published its first technical guidance on AI and filed its first enforcement action alleging algorithmic discrimination.[2] The EEOC also announced a public hearing on the use of automated systems and AI in hiring decisions, scheduled for January 31, 2023.[3] The federal government is not the only regulator in this area. New York City, for example, passed a law that requires employers using AI tools to conduct a bias audit and meet certain posting requirements.[4] Employers can expect the EEOC to bring additional cases in addition to ongoing state and local regulations.
  2. pay equity: The EEOC has signaled that it intends to use payroll data to identify employers in pay equity cases by conducting targeted investigations and indictments. In addition, the SEP proposes that the EEOC will challenge the use of salary histories and desired salary claims in salary determination. This follows many local and state pay transparency laws, including those in New York City, California and Colorado, which require employers to post pay ranges in job advertisements and aim to allow workers to ask about their pay and share it with co-workers to share.[5]
  3. pregnancy discrimination: The EEOC plans to aggressively enforce the newly enacted PWFA, which requires employers to make reasonable accommodations for pregnancy-related illnesses.[6] The PWFA specifically prohibits employers from requiring pregnant employees to take paid or unpaid leave when other reasonable accommodations can be made. Specifically, the PWFA states that by December 23, 2023, the EEOC will issue regulations that will provide “examples of reasonable accommodations to address known limitations associated with pregnancy, childbirth, or related medical conditions.”
  4. Current events: The EEOC will aim to address discrimination based on race, religion, national origin and gender that is influenced by, or arises in response to, local, national or global events.
  5. Settlement, Confidentiality, Non-Discrimination and Arbitration Agreements: The EEOC plans to target disclosures, confidentiality agreements and arbitration agreements that it believes unduly restrict access to the legal system. This is part of a broader trend at the state, local, and other federal agencies such as the National Labor Relations Board (“NLRB”), the Securities Exchange Commission (“SEC”), and the Federal Trade Commission (“FTC”).[7] Additionally, just last month, on December 7, 2022, the Speak Out Act was signed, prohibiting the enforcement of pre-trial confidentiality and non-disparagement clauses in disputes involving claims of sexual assault or sexual harassment.[8] Although the EEOC’s authority in this area is questionable (and it lost a previous challenge regarding the use of termination agreements[9]) the EEOC will likely continue to draw attention to these types of agreements.
  6. target industries: The SEP cites the alleged lack of diversity in certain industries such as construction and “high tech” (no evidence cited) as areas of particular concern. In fact, EEOC Chairman Burrows previously chaired a hearing to investigate alleged discrimination in the construction sector, with a particular focus on women and people of color.[10] The EEOC has already started targeting these industries in 2022 and employers can expect the EEOC to continue to take enforcement action in this area.
  7. Vulnerable Populations: EEOC defines vulnerable populations that it believes cannot readily receive assistance on their own behalf, including immigrants, those with a record of arrest or conviction, LGBTQI+ individuals, older workers, low-wage workers, Native Americans, and those with literacy disabilities or knowledge of English. This is not a new focus, as EEOC has focused on expanding access to jobs for workers from underrepresented communities through its Reshaping Equity (“HIRE”) hiring initiative, launched in January 2022.[11]
  8. Recruitment and Hiring: The EEOC will pay special attention to recruitment and hiring to remove barriers resulting from allegedly exclusionary job advertisements or restrictive or inaccessible application systems. This focus is likely to be dovetailed with the use of emerging technologies such as AI and machine learning.
  9. Systemic harassment: The EEOC will likely seek to raise cases of systemic harassment on all protected bases as one of its “top issue priorities”. The SEP underscores that the EEOC is determined to “combat this ongoing problem” as over 34 percent of the indictments it received between 2017 and 2021 included an allegation of harassment.
  10. Again COVID: The EEOC says that while it hopes discrimination directly linked to COVID-19 will decrease as the nation recovers from the pandemic, it will continue to focus on COVID-19-related workplace discrimination, including cases related to Vaccine shelters, medical checkups, and pandemic-related stereotyping.

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[1] Draft Strategic Enforcement Plan (10 January 2023), https://www.federalregister.gov/documents/2023/01/10/2023-00283/draft-strategic-enforcement-plan.

[2] For more information, see Gibson Dunn’s Client Alert, Keeping Up with the EEOC: Artificial Intelligence Guidance and Enforcement Action.

[3] EEOC, Dealing with Workplace Discrimination in AI and Automated Systems: A New Frontier of Civil Rightshttps://www.eeoc.gov/next-commission-meeting.

[4] Enforcement of the law has been postponed to April 15, 2023 (from January 1, 2023) because the city’s Department of Consumer Protection will host a second public hearing on the proposed rules on January 23, 2023 to clarify the many ambiguities in the law. For more information, see Client Alerts by Gibson Dunn, New York City Proposes Rules to Clarify Upcoming Artificial Intelligence Law for Employers, New York City Enacts Law Restricting Use of Artificial Intelligence in Employment Decisions.

[5] For more information, see Gibson Dunn’s Client Alerts, New York City Enacts Pay Transparency Law Requiring Salary Ranges in Job Postings, California Enacts Pay Transparency and Disclosure Requirements Using January 1, 2023, Colorado’s Department of Labor and Employment Takes Hard Line on Remote Jobs die Exclude Colorado applicants to avoid challenging aspects of Equal Pay for Equal Work Act posting requirements.

[6] For more information, see Gibson Dunn’s Client Alert, Complying with The Pregnant Workers Fairness Act: Considerations For Employers (Soon).

[7] See eg, Rulemaking for Non-Compete Clause, Fed. Trade Comm’n (January 5, 2023). For more information, see Gibson Dunn’s Client Alert, FTC Proposes Rule to Ban Non-Compete Clauses.

[8] For more information, see Gibson Dunn’s Client Alert, Biden Signs Speak Out Act Limiting Enforcement of Non-Disclosure and Non-Disparagement Clauses in Sexual Harassment Cases.

[9] EEOC vs. CVS Pharmacy, Inc., 809 F.3d 335, 343 (7th Cir. 2015) (Acknowledging rejection of EEOC’s contention that CVS’ allegedly confusing termination agreements violated Title VII by leading former employees to believe they were barred from prosecuting to levy the EEOC). The Seventh Circuit emphasized that the EEOC’s power under Title VII “does not create broad enforcement powers for the EEOC to prosecute non-discriminatory employment practices it dislikes.” ID. at 341.

[10] EEOC, EEOC shines a spotlight on discrimination and opportunity in construction (May 17, 2022), https://www.eeoc.gov/newsroom/eeoc-shines-spotlight-discrimination-and-opportunities-construction.

[11] EEOC, Reshaping Justice (HIRE) Hiring Initiative – Fact Sheethttps://www.eeoc.gov/hiring-initiative-reimagine-equity-hire-fact-sheet.

The following Gibson Dunn attorneys helped prepare this client update: Jason Schwartz, Katherine Smith, Harris Mufson, Molly Senger, Naima Farrell, and Emily Maxim Lamm.

Gibson Dunn’s attorneys are available to assist you with any questions you may have about these developments. To learn more about these issues, please contact the Gibson Dunn attorney with whom you normally work, a member of the firm’s labor and employment practice, or Jason Schwartz and Katherine Smith.

Jason C. Schwartz – Co-Chairman, Labor & Employment Group, Washington, DC
(+1 202-955-8242, [email protected])

Katherine VA Smith – Co-Chair, Labor & Employment Group, Los Angeles
(+1 213-229-7107, [email protected])

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