EEO-1 Pay Data Roller Coaster
In a whirlwind few weeks, the fate of the EEO-1 Pay Data requirement (referred to as “Component 2”) was finally decided…or was it?
As a quick refresher, the EEO-1 survey must be filed annually by private employers with 100 or more employees, and by federal contractors with 50 or more employees and a federal contract/subcontract in excess of $50,000. The survey requires employers to report information regarding the race, ethnicity, and gender of its workforce by job category.
EEOC Issues New Rule Requiring Submission of Summary Pay Data
In September 2016, the Equal Employment Opportunity Commission (“EEOC”) announced that beginning March 2018, covered employers must submit summary pay data on an annual basis through a revised EEO-1 Report. For more information on what the summary pay data requirement entails, see our October 18, 2016, article here.
OMB Stays Requirements
Following President Trump’s election (and subsequent changes in administrative agency leadership), the Office of Management and Budget (“OMB”) halted the new EEO-1 pay disclosure requirements on August 29, 2017. OMB argued that after approving the revised EEO-1 form on September 29, 2016, the EEOC subsequently released data file specifications for employers to use in submitting EEO-1 data. Those specifications were not contained in the Federal Register notices as part of the public comment process, nor were they outlined in the supporting statement for the collection of information. As a result, the public did not receive an opportunity to provide comment on the method of data submission to EEOC. In addition, the EEOC’s burden estimates did not account for the use of the particular data file specifications, which may have changed the initial burden estimate.
Additionally, OMB also stayed the effective date of the revised EEO-1 because it was “concerned that some aspects of the revised collection of information lack practical utility, are unnecessarily burdensome, and do not adequately address privacy and confidentiality issues”—a sentiment shared by most employers.
Employers Continue to Submit Traditional EEO-1 Data
In the meantime, applicable employers continued to submit the traditional EEO-1 forms by the new March 31, 2019, deadline.
EEOC Extends 2019 EEO-1 Deadline
On February 1, 2019, the EEOC announced its extension of the EEO-1 filing deadline to May 31, 2019, due to a “partial lapse in appropriations” related to the government shutdown.
Federal Judge Reinstates Pay Data Requirement
Here’s where things got a little crazy. On March 4, 2019, a Federal Judge in the U.S. District Court of the District of Columbia reinstated the pay data collection requirement because OMB’s original stay was “arbitrary and capricious.” Soon thereafter, on April 25, 2019, the Court heard argument regarding the logistics of collecting such data moving forward. The Court ruled that the EEOC must collect 2018 pay data by September 30, 2019. Additionally, the Court directed the EEOC to collect an additional year’s worth of data, giving the EEOC the option of selecting 2017 or 2019 data. The Court ordered the EEOC to decide which year’s data must be submitted by May 3rd.
EEOC Announces Additional Dataset
On May 2, 2019, the EEOC announced its decision to require employers to submit summary pay data for calendar year 2017, in addition to data for calendar year 2018, and both by September 30, 2019. This decision has prompted employers to determine whether their systems even allow it to recreate data from 2017.
But Wait! OMB Appeals!
On May 3, 2019, OMB appealed the Court’s order requiring submission of summary pay data. Are you exhausted yet? I am!
What does this mean? It means we will have to wait and see what happens at the appellate level (a little déjà vu to the overtime regulations?).
In the meantime, despite the “on again, off again” nature of this saga, your basic EEO-1 requirements remain in place. You must still submit your traditional EEO-1 data (without the pay information) by May 31, 2019.
We will keep you posted as this ride continues. Don’t hesitate to contact us with any questions.