The Clock Is Ticking: What Employers Should Know to Prepare for EEO-1 Pay Data Submissions
Despite administrative conflicts surrounding the newly revived EEO-1 Component 2 pay data requirements, employers should now begin preparing their compensation data for submission to the Equal Employment Opportunity Commission (“EEOC”). As previously reported here, in April of this year, a federal judge set September 30, 2019 as the deadline for covered employers to submit 2017 and 2018 pay data as part of the EEO-1 Component 2 report. Although the Department of Justice has filed an appeal to this ruling, employers are still required to comply with the submission by the September 30th deadline.
EEOC Component 2 Online Filing Portal
The filing portal is now OPEN for data submission, and in mid-July, the EEOC began providing employers with log-in information via email and/or US Postal Service. The filing portal is located at https://eeoccomp2.norc.org. Note that this is a different site from the Component 1 online portal.
Employer Filing Requirements
In addition to the online filing system, the EEOC posted helpful guidance regarding which employers must file Component 2 data, how employers should compile the required data, and how such data should be formatted for submission.
An employer is required to file 2017 Component 2 data if it had 100 or more employees during the 2017 “workforce snapshot period.” Similarly, if the employer had 100 or more employees in the 2018 “workforce snapshot period,” it must file 2018 data. The “workforce snapshot period” is an employer-selected pay period between October 1 and December 31 of the reporting year. Notably, private employers and federal contractors with fewer than 100 employees do not have to submit the Component 2 compensation data.
All full-time and part-time employees on the employer’s payroll during the selected pay period must be included in the employer’s headcount in order to determine whether the employer is required to submit data. However, an employer’s workforce snapshot period for Component 2 data can be different than the period chosen for 2017 and 2018 Component 1 reporting. Accordingly, an employer can even choose a pay period in which it had less than 100 employees.
If an employer is required to file Component 2 data, it will need to submit this data in a summary data matrix similar to or the same as that of the sample Component 2 form that the EEOC has provided here. This form requires that employers aggregate the total number of hours worked by employees of the same race, gender, pay band, and job category, and then place those totals in the corresponding cells.
To identify the pay band that employees should be placed in, employers should use the employees’ W-2 box 1 income, which includes total taxable wages, tips and other compensation that the employer paid to the employee during the calendar year.
In order to calculate the total hours of employees within the workforce snapshot period, the employer must include the actual hours worked by the employees over the full calendar year. For those employees that are exempt under the Fair Labor Standards Act (“FLSA”), employers have the option of providing actual hours worked if the employer maintains such information, or using a 40 hour-per-week proxy for full-time workers or a 20 hour-per-week proxy for part-time employees, multiplied by the number of weeks they were employed during that year.
To stay ahead of the approaching deadline, employers should prepare early by categorizing and confirming each full-time and part-time employee’s:
- Race for 2017 and 2018 workforce snapshot period;
- Gender for 2017 and 2018 workforce snapshot period;
- 2017 and 2018 W-2 box 1 income; and
- 2017 and 2018 total hours worked.
Component 2 can be confusing, and Baird Holm wants to be there to help you along the way. For more information about EEO-1 reporting, or any other legal issues in the workplace, do not hesitate to contact us.
Kelli P. Lieurance
Clay Haag, Summer Associate