Expert vs. Robot, Part 5: Legal Counsel & Attorney–Client Privilege

By: Lisa Harpe, Jon Geier, and Don Lustenberger

Our summer blog series contrasting “expert” versus “robot” approaches to pay equity ends this week as we discuss the role of legal counsel and the importance of establishing attorney–client privilege when conducting pay equity work. Our previous installments reviewed phases of a pay equity study: project kickoff & data cleaning; analysis planning & execution; and investigating pay disparities & making salary adjustments. 

At various points throughout our summer blog series, we’ve touched on the role that legal counsel can play in conducting a pay equity study. Legal counsel—whether internal or external to the organization conducting the pay equity study—can serve to advise the organization and help it manage its risk. Legal counsel may sometimes offer guidance during the planning phase, when deciding how to group employees for analysis. Legal counsel can also help guide strategies for addressing any inequities uncovered by the analysis, including which groups to prioritize for pay adjustments, for example. Perhaps the most important aspect of involving legal counsel in a proactive pay equity study, however, is establishing and maintaining attorney–client privilege.  

Attorney–Client Privilege 

Human Resource Information System (HRIS) data contains extremely sensitive personal data. In particular, and relevant to pay equity studies, HRIS data contains demographic information such as race, gender, and age, as well as information about employee pay. The results of a pay equity study reveal the damages a plaintiff class can assert. In the wrong hands, this information would pose legal risk to an employer, both because of concerns with violating privacy rights and the potential for discrimination claims. Therefore, employers conducting pay equity studies should, and often do, take steps prior to the study to set up protocols to ensure the privileged nature of the study and results. While there are a number of ways to establish attorney–client privilege, there are some key components.  

1. Secure Legal Counsel/Internal v. External. Legal counsel should be involved in all pay equity studies. While internal counsel can be used, it may be more difficult to sustain the privilege in the event of a challenge. Thus, ideally, external counsel with pay equity experience can direct the project and structure communications and processes to ensure attorney client privilege.
2. Implement Privilege Protocol. Legal counsel should develop a specific protocol related to the marking of emails, documents, etc. For example, a legend like “Privileged and Confidential/Attorney Client Communication” might be used as a header on all communications. 
3. Limit Access to Information. Limit the number of employees in the protocol groups for each work stream to the smallest number of individuals who have a need to know the legal advice or analysis in order to perform their job functions. If individuals not included in the original protocol changes, legal counsel should extend the protocol to them. 
4. Include Legal Counsel Throughout the Process. Information is not privileged simply because it comes from an attorney or because an attorney is copied on communications or attends a meeting. When an attorney is merely acting as a conduit for information, the privilege does not apply. Legal counsel must be involved in planning, interpretation, and any dissemination of results, as well as in the development of any remediation strategy for the privilege to be sustained if challenged. 
5. Limit Results Sharing. Results of preliminary analyses should be shared with a limited group including legal counsel. This provides an opportunity to discuss potential revisions and next steps. Without privilege, pay equity studies can be used by opposing counsel as evidence of how employees should be grouped for analysis, what factors should or should not be accounted for, and evidence of existing pay disparities along race and gender lines.  

If set up appropriately, legal counsel advises the client for the duration of the pay-equity study; informs key steps of the analysis; guides remediation strategies for any pay inequities that may surface; and helps the client organization mitigate risk, all under the attorney–client privilege.  

An expert likely has experience collaborating with legal counsel on pay equity studies and can adhere to any implemented protocols. A robot, by its nature, cannot collaborate with legal counsel so that the onus falls to those using the robot to conduct the pay studies. In particular, one potential ‘advantage’ of a robot approach is the ability to run ad hoc analyses and include or exclude different factors to find the ‘best’ model. For attorney–client privilege to apply, outside counsel needs to be advising the client. If a client is running analyses ad hoc and adjusting models themselves, is counsel really providing guidance? 

All the stages covered in this series should have legal counsel involvement to advise and direct whoever is implementing the study, interpreting results, investigating disparities, making decisions on salary adjustments, and deciding on what and how to communicate results. If an employer cannot assert privilege, the data, analyses, and / or results could be subject to disclosure in a pay discrimination claim.  

Pay equity risk is not going away. In addition to federal law, many states have passed their own legislation that employers must consider. Engaging with competent experts will mitigate these risks in ways that a robot simply cannot.