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An Unwelcome Surprise From the EEOC for Employers With 100 or More Employees

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Private employers with 100 or more employees have long been required to submit annual employer information reports (“EEO-1 reports”) to the Equal Employment Opportunity Commission (the “EEOC”) showing the number of their employees by job category, race, sex, and ethnicity. The EEOC refers to this as component 1 data. In 2016, during the twilight of the Obama administration, the EEOC proposed changes to the EEO-1 report that would require employers to include pay data and the number of hours worked by their employees. That proposal was to go into effect in late 2017. However, before the effective date, that requirement was stayed by the new administration’s Office of Management and Budget (the “OMB”), which found it overly burdensome. Employers breathed a sigh of relief, assuming that the proposal was dead—not so.

Various organizations, including the National Women’s Law Center, sued the OMB and the EEOC, claiming that the stay was unlawful. In March 2019, a federal judge in Washington D.C. agreed with the plaintiffs and revived the revised EEO-1 report, finding that the OMB’s stay of the pay-data component was not justified. The judge’s decision caught everyone, including the EEOC, by surprise and raised a number of questions, especially when the required pay-data reports would need to be filed. The EEOC proposed a due date of September 30, 2019, for the 2018 pay-data report, and the judge agreed. Additionally, the judge allowed the EEOC to choose between requiring submission of 2017 data (with a due date of September 30, 2019) or 2019 data, (which would have had a 2020 due date.) Last week, the EEOC announced its decision to require 2017 data. The bottom line is that pay data for both 2017 and 2018 are due to the EEOC by September 30, 2019.

It is possible that the EEOC will appeal from the trial judge’s order and seek to block it pending the outcome of any such appeal. The EEOC’s website, however, directs employers to comply with the requirement. Prudent employers will want to begin preparing for meeting the deadline of September 30, 2019, and then possibly be pleasantly surprised if they are granted a reprieve.

So what is required?

The EEOC’s website states the following:

“Notice of Immediate Reinstatement of Revised EEO-1: Pay Data Collection for Calendar Years 2017 and 2018

EEO-1 filers should begin preparing to submit Component 2 data for calendar year 2017, in addition to data for calendar year 2018, by September 30, 2019, in light of the court’s recent decision in National Women’s Law Center, et al., v. Office of Management and Budget, et al., Civil Action No. 17-cv-2458 (D.D.C.) The EEOC expects to begin collecting EEO-1 Component 2 data for calendar years 2017 and 2018 in mid-July, 2019, and will notify filers of the precise date the survey will open as soon as it is available.

Filers should continue to use the currently open EEO-1 portal to submit Component 1 data from 2018 by May 31, 2019.”

Component 2 data includes W-2 wage information and total hours worked by gender, race, and ethnicity of employees. Employers are also required to disclose the number of employees falling within each of 12 pay bands for each job category. At this time, the date on which the EEOC will begin accepting Component 2 data through the EEO-1 online portal has not yet been established.

Employers must bear in mind that the September 30, 2019, deadline applies only to Component 2 pay data. Component 1 data—the traditional data that has been required for many years—must be submitted by May 31, 2019, to be timely. And if you are used to requesting and getting a 30 day extension for submitting Component 1 data, there is an additional surprise—the maximum extension time this year has been limited to 14 days, i.e., June 14, 2019.