The Equal Employment Opportunity Commission has stated that it will collect the pay data required by its revised EEO-1 form by September 30, 2019. Given this unexpected development, employers must begin thinking about compliance with this new requirement while awaiting further instructions from the EEOC.
Who Must File an EEO-1 Form? Employers who are required to file an EEO-1 form are (1) those subject to Title VII with 100 or more employees; and (2) federal contractors and first-tier subcontractors subject to Executive Order 11246 with 50 or more employees and a contract, subcontract, or purchase order amounting to $50,000 or more.
The Addition of Compensation Data to the EEO-1 Form. The original EEO-1 form sought information regarding the race, ethnicity, and sex of the workforce in 10 job categories. In September 2016, the EEOC issued a revised EEO-1 survey form that added the requirement to provide aggregated data for the prior year on pay and hours worked, broken down into 12 pay bands across the 10 job categories, by the same racial, ethnic, and sex groups. This data would be drawn from one single payroll period of the employer’s choosing occurring between October 1 and December 31 of the prior (reporting) year. The annual submission period of the form was also moved from September to March. The form was to take effect in March 2018.
The Stay on the New EEO-1 Form. On August 29, 2017, the Office of Management and Budget, which has the responsibility of reviewing all significant regulatory actions before they take effect, informed the EEOC that it was initiating an immediate stay of the pay data collection aspects of the revised EEO-1 form and would be reviewing their effectiveness. In light of this action, the EEOC stated that employers should plan to comply with the prior version of the EEO-1 form, although by the new submission deadline of March 31, 2018, rather than the traditional September 30 deadline.
Court Orders New EEO-1 Form to Take Effect. Litigation ensued, however, with the National Women’s Law Center and other groups suing to enforce the implementation of the revised EEO-1 form. Last month, a federal court found the OMB’s stay to be illegal and ordered the revised EEO-1 form to take effect. The court further ordered that the EEOC must clarify for employers by April 3, 2019, whether they will have to report 2018 pay data in this year’s EEO-1 reports.
EEOC Now Announces Collection of Pay Data by September 30, 2019. The period for filing the EEO-1 form, which normally ends on March 31 of each year, just recently opened and was scheduled to close on May 31, 2019. (The delay in the reporting period was the result of the five-week government shutdown.) But the EEOC has now announced that it will extend the reporting period to September 30, 2019 in order to comply with the court’s order to collect the new pay data.
The EEOC admits that it is not capable of collecting the required data at this time. It notes that it collects EEO-1 data from approximately 80,000 employers, and its current data processes are programmed to collect 140 data fields for the demographic information. The new pay data requirement will add 3,360 data fields, and, according to the EEOC’s Chief Data Officer, the required modification to the EEOC’s data processes would take nine months. Accordingly, the EEOC has decided to utilize a data and analytics contractor to perform the data collection for the 2019 EEO-1 submission.
The EEOC further warns that the expedited data collection process may yield poor quality data, particularly since this is the first time that data is being collected. Although, technically speaking, the EEOC should have also collected 2017 pay data for the 2018 EEO-1 submission, it is choosing not to complicate an already challenging task and will not be including this data in the upcoming data collection process.
What Now? At this time, the online EEO-1 submission form does not contain the required pay data components. The submission deadline has been extended to September 30, 2019, and the EEOC will be issuing additional instructions to employers regarding the pay data components. Thus, employers need not submit their EEO-1 forms at this time, but should await further developments from the EEOC. We will keep you posted on the EEOC’s pronouncements.