Hold On to Your Hats – Expanded EEO-1 Pay Data May Need to Be Reported for 2018

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March 4, 2019

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A Washington, D.C. federal district court judge in National Women’s Law Center v. OMB recently stated that the previously revised EEO-1 report, including employee pay data, is the form employers should be using to submit their required Employer Information Report. In 2016, the EEOC proposed changes to its employer data collection requirements to add 12 pay bands for the 10 job categories that are tracked in EEO-1 reporting. After proposed revisions, the rule was approved by the Office of Management and Budget (OMB) and the revised EEO-1 form was issued. However, following the 2016 presidential election, the OMB directed the EEOC to issue a stay of the form’s release, which it did, and the EEOC subsequently removed the revised EEO-1 form from its website.

The federal district court stated, in part, that the OMB failed to demonstrate good cause for the stay of the form’s release, making its action “arbitrary and capricious.” Moreover, because the stay was temporary, filers should have known that the stay could have been withdrawn at any time and they could be required to report the pay data.

What should employers do now? Employers with 100 or more employees, and federal contractors with at least 50 employees, should prepare to submit compensation information, by race, sex, and ethnicity in their EEO-1 report, which is due by the extended deadline of May 31, 2019. It is possible that the EEOC may delay reporting of pay data to give employers time to comply with the district court’s ruling. Additionally, the OMB is expected to appeal the ruling to the D.C. Circuit Court of Appeal, which may include a further delay of implementation of the expanded reporting requirements. Regardless, employers are strongly recommended to have a pay audit conducted for compliance with federal and state equal pay laws before reporting is mandated to avoid potential exposure.

Action Items

  1. Read the court’s ruling here.
  2. Collect pay data for EEO-1 reporting for 2018 and 2019.
  3. Have a pay audit conducted for compliance with federal and state equal pay laws.
  4. Look for updates as an appeal of the ruling is expected.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2019 ManagEase

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