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Act Now! EEOC Wants You to File Pay Data Soon

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Employers should be preparing their employee pay data for submission to the Employment Opportunity Commission (“EEOC”) by September 30, 2019. This requirement follows the recent court decision in National Women’s Law Center, et al., v. Office of Management and Budget, et al., which held that private employers with 100 or more employees must submit information about their employees’ W-2 earnings, hours worked, and demographic information for the years 2017 and 2018.

 

Background

Historically, private employers with 100 or more employees are required to submit to the EEOC various workforce data, including the sex, race, and ethnicity of their employees, divided by job category (“EEO-1”).[1] The EEOC uses this data about the number of women and minorities companies employ to support civil rights enforcement and analyze employment patterns.

In 2016, in an effort to curb pay discrimination, the EEOC obtained approval from the Office of Management and Budget (“OMB”) under the Obama administration to expand the data collected under the EEO-1 form. Under this revised data collection, called Component 2 of the EEO 1 form, employers would be required to include employees’ W-2 earnings and hours worked, sorted by sex, race, and ethnicity, within twelve distinct pay bands for ten delineated job categories. This data is in addition to the previously requirements, such as employees’ ethnicity, race, and sex, broken down by job category (“Component 1 data”).[2]

Under the Trump Administration, the OMB reversed its decision to revise the EEO 1 form and announced a stay of the expanded data collection. The OMB confirmed that employers should still comply with their reporting obligations under the previously-approved EEO-1 form concerning only general employee demographic data.

Following the OMB’s announcement, the National Women’s Law Center and Labor Council for Latin American Advancement, two non-profits that advocate for the closing of the gender and race pay gaps, filed a suit to reinstate the expanded EEO-1 reporting requirements.

The District Court held that the OMB “provided inadequate reasoning to support its decision to stay the data collection.” As a result, it ultimately held that the stay was illegal and vacated it.

 

Employer Next Steps

Private employers with 100 or more employees must submit Component 2 data for calendar years 2017 and 2018 by September 30, 2019. Although the DOJ filed a Notice of Appeal in the National Women’s Law Center case, that notice does not alter EEO-1 filers’ obligations to submit 2017 and 2018 Component 2 data. It is unclear whether further litigation will impact the September 30 deadline, so employers should plan on complying with the current deadline.

The Component 2 EEO-1 Online Filing System data collection instrument will be available for all filers on July 15, 2019. System login information will be sent to employers via USPS letter and email on July 15, 2019.

Employers should keep in mind that their 2018 data for Component 1 of the EEO-1 form was due by May 31, unless they requested an extension.

The Maier Law Group recommends that affected businesses review their capabilities to pull, analyze, and submit the Component 2 data via the EEOC’s web portal. In some cases, the Component 2 data may be housed by vendors that handle their payroll and timekeeping. At the EEOC’s discretion, some small businesses may be able to seek an exemption where filing would cause an undue burden. If you have questions or concerns about your company’s filing of Component 2 data, please contact an attorney at MLG.

Authors: Kym LeGolvan and Caitie Emmett, Associates.

The Maier Law Group helps companies ensure that their policies and practices comply with the relevant workplace regulations.  Please contact us at info@maierlawgroup.com for more information.

This article has been prepared for general informational purposes only and does not constitute advertising, solicitation, or legal advice. If you have questions about a particular matter, please contact the Maier Law Group directly.

[1] This requirement was implemented in 1966 and applies to all employers subject to Title VII of the Civil Rights Act of 1964, and who have that has 100 or more employees. 29 C.F.R. § 1602.7. Federal contractors and subcontractors with more than 50 employees might also be subject to this requirement, which is enforced by the Office of Federal Contract Compliance Programs.

[2] 81 Fed. Reg. 45479 et seq. “Such data will support the EEOC’s ability to discern significant pay disparities in the early stages of its investigations and, in conjunction with other information, to make more efficient decisions about how to plan the investigations going forward.” Id. The job categories include, but are not limited to, professionals (i.e., accountants, computer programmers, physicians, and teachers), administrative support workers, service workers (i.e., janitors, cooks, and firefighters), laborers and helpers, craft workers, and sales workers.

Sujatha V Rajagopal