The Equal Employment Opportunity Commission (EEOC) and the Department of Labor (DOL) issued their semi-annual regulatory agendas setting forth their plans to propose or revise regulations. The EEOC voted to rescind its affirmative action guidelines. The House Committee on Education and the Workforce approved a bill that is designed to assess the impact of artificial intelligence on the workforce. The Supreme Court announced a decision that the exemption provision of the Federal Arbitration Act would prevent mandating arbitration in a dispute between a company and an individual who handled products only within one state, since these products were shipped from outside the state.

EEOC & DOL Release Regulatory Plans

The Equal Employment Opportunity Commission (EEOC) and the Department of Labor have published their semi-annual regulatory agendas that were published in the Federal Register. The EEOC intends to address the following issues:

Employer Information Reports – The EEOC voted to issue a proposed rule rescinding the requirement that employers file the Employer Information Report (EEO-1), Apprenticeship Information Report (EEO-2), Local Union Equal Employment Opportunity Report (EEO-3), State and Local Government Information Report (EEO-4), or Elementary-Secondary Staff Information Report (EEO-5). Comments must be submitted by August 24. According to EEOC Chair Andrea Lucas, "Because the EEO Data Reports require all covered employers to categorize employees by race and sex annually, disconnected from any allegation of a Title VII violation or related Commission enforcement proceeding, the EEO Data Reports stand in direct tension with Title VII's requirement that employment practices be colorblind. Collecting such data about employees' race and sex — absent any specific allegation of discrimination — not only risks hindering effective enforcement of equal employment laws but also raises constitutional concerns."

Pregnant Workers Fairness Act – The EEOC plans to amend its regulations implementing the Pregnant Workers Fairness Act (PWFA) to revise the interpretation of the words "pregnancy, childbirth, or related medical conditions." The tentative date for release of the proposed changes is November 2026.

Uniform Guidelines on Employee Selection Procedures – Recordkeeping – The EEOC will propose rescinding the recordkeeping requirements of the Uniform Guidelines on Employee Selection Procedures (UGESP) with a tentative release date of July 2026. UGESP requires employers to maintain records that would allow the impact of its selection procedures on the employment opportunities of people based on race, sex, or ethnic group to be analyzed.

Uniform Guidelines on Employee Selection Procedures – In November 2026, the EEOC intends to rescind the Uniform Guidelines on Employee Selection Procedures (UGESP). These guidelines apply to selection procedures such as tests. When a selection procedure is found to have an adverse impact, UGESP requires the employer to validate the procedure and retain the documentation.

The DOL plans to issue or finalize regulations concerning independent contractor status under the Fair Labor Standards Act (FLSA) and joint employment.

Independent Contractor Regulations – In February, the DOL issued proposed regulations concerning independent contractor status under the FLSA. DOL intends to finalize the regulations in October 2026. The proposed regulations would rescind the 2024 regulations determining employee or independent contractor classification that was the subject of five lawsuits. The DOL proposed to replace the 2024 rule with the 2021 rule that had been previously adopted.

Joint Employer Status – The DOL is considering issuing proposed regulations in July 2026 addressing joint employer liability under the FLSA. Since 2021, there has not been regulatory guidance on this issue.

EEOC Rescinds Affirmative Action Guidelines

The Equal Employment Opportunity Commission (EEOC) voted to rescind its guidelines, "Affirmative Action Appropriate Under Title VII of the Civil Rights Act of 1964" and the related "Compliance Manual Section 607 on Affirmative Action". The guidelines had been adopted by EEOC in 1979. According to the EEOC, the guidelines were inconsistent with Title VII, were obsolete, envision only plans benefiting minorities and women thus providing less protection to majority-group employees, and may conflict with subsequent caselaw and the Constitution. EEOC Chair Andrea Lucas stated this action "reaffirms that Title VII's protections apply equally to all American workers and that equal opportunity remains a defining commitment of our democracy." Kalpana Koatagal, the only current commissioner appointed by a Democrat, voted against the rescission characterizing it as "yet another attack by this administration on civil rights protections for workers."

House Committee Approves AI Workforce Impact Bill

The House Committee on Education and the Workforce approved the "AI Workforce Assessment and Research Enhancement Act" (H.R. 9381). The bill was introduced by Representative Tim Walberg (R-MI), chairman of the Committee on Education and the Workforce, and would direct the Bureau of Labor Statistics (BLS) to report on the use of artificial intelligence (AI) in the workplace. According to Representative Walberg, "there is currently no consistent or timely method for measuring how employers are utilizing AI or how it is augmenting or automating worker tasks." Among the findings in the legislation are that "Improved measurement of AI use and its labor market effects will strengthen workforce analysis, support further economic and workforce policy development, improve employment projections and related research, and provide employers, workers, and educators with more information to more effectively respond to technological change in their workplaces." The bill will be considered next by the full House of Representatives.

In the Senate, Senator Mark Warner (D-VA) and Senator Josh Hawley (R-MO) have introduced the "AI-Related Jobs Impacts Clarity Act" (S. 3108) that would require major companies and federal agencies to report quarterly to the Department of Labor (DOL) on AI-related job effects including layoffs and job displacement. The DOL would compile the data and publish a report. The bill has been referred to the Committee on Health, Education, Labor and Pensions.

Supreme Court Refuses to Compel Arbitration

By unanimous decision, the United States Supreme Court ruled that while the Federal Arbitration Act requires courts to enforce private arbitration agreements, the exemption in Section 1 of the Act for those working in interstate commerce would apply to individuals who work within one state but help to deliver goods as part of their interstate journey. Justice Gorsuch, who wrote the decision of the court in Flowers Foods Inc. v. Brock, stated, "individuals can sometimes be direct, necessary, and active participants in moving goods 'from . . . points in one state' to 'points in another state' without crossing state lines or interacting with vehicles that do."

Flowers Foods produces packaged goods at its bakeries in 19 states that are distributed across the country. The company has franchisees who distribute the products in specified geographical areas. Angelo Brock serves the Denver area and picks up the products from a warehouse in Colorado and delivers them to stores without leaving the state. He sued Flowers, alleging that the company had underpaid him and other distributors. Flowers asked the court to send the dispute to arbitration citing its private arbitration agreement with Mr. Brock. Both the District Court and the Tenth Circuit denied the company's motion that arbitration should be compelled.

In affirming the Tenth Circuit, the Supreme Court rejected the theory that to be engaged in interstate commerce and qualify for the exemption contained in Section 1, a worker either must cross state lines or interact with a vehicle that does. Justice Gorsuch believed that "At least sometimes, a worker who transports goods on an intrastate leg of an interstate journey can qualify for §1's exemption without satisfying either of those criteria."

Neil Reichenberg is the former executive director of the International Public Management Association for Human Resources. He is an attorney, a frequent writer and speaker on public policy and human resource issues, and an adjunct faculty member at George Mason University. For questions or additional information, contact Reichenberg at neilreichenberg@yahoo.com.