As an Affirmative Action Compliance organization, we are committed to keeping our clients and the broader contractor community informed about significant legal developments that may impact your operations. Today, we delve into a critical court ruling that centers around the disclosure of Type 2 EEO-1 data under the Freedom of Information Act (FOIA). This ruling could have substantial implications for federal contractors.

Recently, the Northern District Court of California issued a decision in the case of the Center for Investigative Reporting v. U.S. Department of Labor (3:22-cv-07182-WHA), which bears directly on the disclosure of Type 2 EEO-1 data from 2016-2020. This ruling comes after the Office of Federal Contract Compliance Programs (OFCCP) sought a summary judgment regarding whether this data is exempt from FOIA disclosure under Exemption 4.

The court’s decision, handed down on December 22, 2023, followed a thorough review of motions involving six “bellwether” contractors. The critical takeaway is that the Department of Labor (DOL) failed to prove the “inherently commercial nature” of the diversity data in EEO-1 reports. Consequently, this data could not be classified as “commercial information” shielded under FOIA Exemption 4.

Furthermore, the court observed that no commercial gain is derived from the demographic and headcount data within these reports. Therefore, releasing five years’ worth of data to plaintiffs would not have a compounded adverse effect. Notably, the court did not address the confidentiality aspect of Exemption 4, as both commerciality and confidentiality criteria need to be met to justify withholding the reports.

This ruling is significant for federal contractors as it may set a precedent for the future handling of EEO-1 Type 2 data. The decision could lead to more transparency in employment practices but also raises questions about data privacy and the protection of sensitive information.

We, at Kairos, are closely monitoring this situation and will provide updates and guidance as more information becomes available. It’s essential for all federal contractors to stay informed about these developments, as they could have far-reaching effects on compliance practices and data handling procedures.