EEOC Holds Its EEO-1 Rescission Hearing: What Federal Contractors Heard on August 11

If you’ve been tracking this rulemaking since our May and July editions of Compliance News, the August 11 hearing was the next required procedural step, not a new development on its own. But it was a revealing one. The Equal Employment Opportunity Commission (EEOC) brought together 22 speakers with sharply competing views on whether the EEO-1 and its companion reports should disappear, be reformed, or stay exactly as they are. For federal contractors, that split matters: it previews the arguments a final rule will have to survive.

See Previous Posts:

• May 19: EEOC Proposed to Rescind EEO-1 Reporting Requirements: What Happened, Where the Process Stands & How this Affects Federal Contractors
• July 23: EEOC Puts EEO-1 Rescission in Writing: Formal Notice of Proposed Rulemaking Is Now Underway to Rescind Annual Race and Sex Reporting Requirements

What Happened at the Hearing

EEOC counsel opened by confirming the procedural basics: the NPRM published in the Federal Register on July 23, 2026, with a separate hearing notice following on July 30. The EEO-1 covers private employers with 100 or more employees and federal contractors meeting separate size criteria, reported annually via a fourth-quarter workforce snapshot broken out by 10 job categories and seven race/ethnicity groups. EEO-3, -4, and -5 collect similar data every two years from unions, state and local governments, and public school districts. EEO-2 and EEO-6 haven’t actually been collected since 1981 and 1993, respectively, so their rescission is largely a formality. Notably, counsel also confirmed all of this data is already protected by Title VII’s confidentiality provisions; the EEOC cannot make individual employer filings public, undercutting one of the NPRM’s more headline-grabbing justifications.

Each of the 22 registered speakers got five minutes. Chair Andrea Lucas presided, joined by Commissioners Kalpana Kotagal and Brittany Bull Panuccio. Under the Sunshine Act hearing format, commissioners couldn’t question witnesses or deliberate during the session itself, but their presence is a reminder that the underlying NPRM advanced on a 2-1 vote in July, not by consensus. Any final rule will carry the same split, which is worth keeping in mind when assessing how durable it might be.

Listen to Audio from the August 11th Notice of Commission Hearing

The Case for Rescission

Supporters, including the Ethics & Public Policy Center, Do No Harm, 1792 Exchange, and the Pacific Legal Foundation, argued that mandatory racial classification is constitutionally suspect on equal protection and compelled-speech grounds, particularly where employers must visually classify workers who decline to self-identify. The Pacific Legal Foundation specifically argued that requiring employers to assign workers to government-defined racial categories institutionalizes racial classifications and compels employers to communicate those classifications to the government.

Supporters also argued that mandatory EEO demographic reporting is unnecessary to enforce Title VII and imposes burdens on employers and the government that are not justified by the value of the data. They contended that aggregate demographic reporting can encourage employers to focus on workforce composition and demographic balancing rather than individualized, merit-based employment decisions. The organization Do No Harm, for example, argued that demographic benchmarks can create pressure to adjust an organization’s workforce to achieve particular racial or sex-based outcomes. The 1792 Exchange similarly argued that employees should be evaluated based on merit, skill, experience, and performance rather than demographic identity.

Supporters further argued that the EEOC could obtain demographic information through more targeted means when needed for enforcement, including investigations, subpoenas, and requests for records relevant to specific cases. The organization Do No Harm characterized subpoenas following a discrimination charge as a less restrictive alternative to mandatory annual reporting, while the 1792 Exchange said the EEOC would retain authority to request tailored records in specific cases.

The Case Against Rescission

Opponents made a data-driven case. A University of Massachusetts Amherst researcher testified that EEO-1 pay data and the EEO-4 series have documented the measurable effectiveness of federal contractor affirmative action requirements since the 1960s and 70s, with no evidence of resulting discrimination against white men. Legal Defense Fund, the American Civil Liberties Union (ACLU), National Women’s Law Center (NWLC), American Association of University Women (AAUW), and Equal Rights Advocates argued the data is essential to pattern-and-practice enforcement, and several urged better disaggregation rather than elimination to serve Asian American and other underrepresented workers. The National Employment Lawyers Association added that EEO-1 data currently provides a standardized baseline for how discrimination investigations get initiated and substantiated; without it, contractors could face less consistency, not less scrutiny, in how future charges are evaluated. Investor group WhistleStop Capital added a market angle, presenting research linking EEO-1 filings across nearly 1,500 companies to financial performance.

Separately, the Institute for Workplace Equality, representing many of the nation’s largest employers and federal contractors, offered the hearing’s most pointed pushback. It didn’t ask the EEOC to abandon rescission outright, but to pursue reform and modernization instead of elimination. Its counsel also cited over 4,000 DOL employer audits conducted under the first Trump administration, all of which reviewed EEO-1 data, and testified that not a single instance of quota-based use was identified, a concrete gap in the NPRM’s own stated rationale that contractors’ counsel may want on hand as the comment record develops. The Institute additionally flagged that the administration’s own Title VI reporting approach for higher education imposes comparable, and in some respects more detailed, demographic disclosure obligations on colleges and universities than EEO-1 currently imposes on other employers. If EEO-1 reporting is unconstitutional, the argument goes, the administration owes an explanation for why the Title VI approach isn’t. The EEOC has not yet addressed that tension on the record.

What This Means for Federal Contractors

The hearing didn’t change any obligations, but it sharpened a few things contractors should note:

• Nothing is final. The EEOC must still review the comment record (open through August 24) before issuing any final rule, and a legal challenge to a truncated process is a realistic possibility, as it was in 2019. Therefore it’s imperative that you maintain and continue collecting demographic data until a final rule is issued.
• Watch the Title VI comparison. If the EEOC’s constitutional rationale for rescinding EEO-1 doesn’t hold up against its own requirement for a more detailed Title VI reporting standard for higher education, that inconsistency could become a focal point in comments and litigation. Contractors evaluating their own compliance posture should watch the inconsistencies, how, or whether, the agency reconciles the two.
• Recordkeeping and OFCCP audit exposure are separate tracks. Nothing discussed on August 11 affects UGESP recordkeeping obligations or OFCCP’s Section 503 and VEVRAA audit authority. Even a full rescission of EEO-1 reporting would not eliminate the underlying demographic recordkeeping employers still need for disparate impact defense.
• Historical filings remain usable. As several witnesses noted, the EEOC has already used on-file EEO-1 data in DEI-related investigations. Rescinding future collection doesn’t erase what’s already been submitted.

The DirectEmployers Take

This hearing is exactly the kind of regulatory inflection point DirectEmployers exists to track for our Members, so you don’t have to parse a two-and-a-half-hour transcript yourself. We’ll continue monitoring the comment docket, any Federal Register developments, and signs of litigation, and we’ll flag what changes and what doesn’t as this rulemaking moves toward a final rule.

What to Do Now

Keep preparing 2026 EEO-1 data as though the current filing cycle will proceed. Continue demographic data collection tied to UGESP obligations regardless of how EEO-1 reporting resolves. If your organization wants to weigh in, written comments on the NPRM are accepted through August 24, 2026. And watch for the EEOC’s next procedural move, since a final rule cannot be issued until the agency has reviewed the full comment record generated by this hearing and the written submissions that follow it.

Members with questions about EEO-1 compliance or related federal contractor obligations are encouraged to reach out to their DirectEmployers Membership Team for support and compliance resources, utilize the discussion forum to connect with HR compliance peers, or RSVP to attend the upcoming Member Office Hours located in DE Connect.

THIS COLUMN IS MEANT TO ASSIST IN A GENERAL UNDERSTANDING OF THE CURRENT LAW AND PRACTICE RELATING TO OFCCP. IT IS NOT TO BE REGARDED AS LEGAL ADVICE. COMPANIES OR INDIVIDUALS WITH PARTICULAR QUESTIONS SHOULD SEEK ADVICE OF COUNSEL.