Judge Rules Google to Issue Limited Gender-Pay Data

Google won't need to turn over an entire set of employee compensation data to federal auditors, dealing a setback to the Labor Department's effort to prove the internet giant is underpaying women.

An administrative law judge on Friday denied the federal government's request for 19 years of pay data on 21,000 Google employees, ruling the inquiry is overly broad and intrusive of employee privacy. The decision, which isn't yet final, could be a partial victory for the Alphabet Inc. unit, which has resisted the agency's effort to investigate a possible gender pay gap in its workforce.

The Labor Department sued Google for salary data earlier this year as part of a routine audit into whether Google complies with laws barring federal contractors from discriminating against employees. Labor Department official Janette Wipper testified in April than an initial review of 2015 Google data "found systemic compensation disparities against women pretty much across the entire workforce."

In his recommended decision and ruling, Steven B. Berlin, an administrative judge in San Francisco, said the federal agency failed to offer credible evidence of any pay disparity in its request for data. He did, however, ask Google to give the Labor Department a smaller set of pay data for up to 8,000 employees dating back to 2014. The government could appeal the decision.

In a blog post Sunday, Google welcomed the judge's decision, saying its own analysis of its compensation practices doesn't reveal a gender pay gap.

"While we're pleased with Friday's recommended decision, we remain committed to treating, and paying, people fairly and without bias with regard to factors like gender or race," Eileen Naughton, the company's vice president of people operations, said in the post.

The department can investigate Google because the company provides advertising and cloud services for the federal government.

The Labor Department's regional solicitor for San Francisco, Janet Herold, said in an emailed statement the decision vindicates her office's "vigorous enforcement of the disclosure and anti-discrimination obligations federal contractors voluntarily accept in exchange for taxpayer funds."

The agency will continue to investigate Google's pay practices and decide whether to bring charges against the company based on the data it has.

Google also has denied requests from activist investors to disclose the percentage of female pay to male pay. Those investors, led by boutique investment firm Arjuna Capital, requested the same data last year from nine tech firms. Seven complied, including Apple Inc., Amazon.com Inc. and Microsoft Corp. Google and Facebook Inc. didn't.

The Labor Department sued Oracle Corp. in January, accusing the software giant of paying white men more than their counterparts, and favoring Asians for certain technical roles. Oracle, which declined to comment, has said previously that the complaint is based on false allegations and is without merit.

In April, the department settled with data firm Palantir Technologies Inc. over allegations it discriminated against Asians when hiring. Palantir, which admitted no wrongdoing, agreed to pay nearly $1.7 million in back wages to affected people and offer eight of them jobs.

Write to Douglas MacMillan at douglas.macmillan@wsj.com and Jack Nicas at jack.nicas@wsj.com

(END) Dow Jones Newswires

July 17, 2017 13:49 ET (17:49 GMT)