Trump Administration Postpones Revised Form EEO-1 Pay Reporting Requirements
According to the Equal Employment Opportunity Commission (“EEOC”), the White House Office of Management and Budget (“OMB”) has delayed the effective date of the revised Form EEO-1 and initiated a review to determine the appropriateness of the revisions under the Paperwork Reduction Act (“PRA”).
An OMB memorandum sent to the EEOC on August 29, 2017, stated that “the OMB is 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.”
The revised Form EEO-1 expanded pay data reporting requirements for employers with 100 or more employees and federal contractors with 50 or more employees. In addition to reporting the number of employees by race, ethnicity, and sex, employers would also have to report the W-2 wage/salary information for each employee in the same manner.
In anticipation of the additional reporting requirements, the EEOC moved the 2017 Form EEO-1 filing deadline from September 30, 2017 to March 31, 2018, with reports to be due on March 31 for all subsequent years.
The EEOC has decided to keep the March 31, 2018 deadline in place even though the OMB has stayed the effective date of the revised Form EEO-1. Employers may continue to use the latest version of Form EEO-1 to comply with the reporting obligations for FY 2017, they are just instructed to leave the salary information portion blank.
The compensation reporting requirement was an Obama Administration initiative. Advocates for pay equality, such as Fatima Goss Graves, President and CEO of the National Women’s Law Center in Washington, D.C., believed the revised Form would “encourage companies to identify and correct pay disparities and allow the EEOC to more effectively and efficiently root out and address pay discrimination.”
The now acting chair of the EEOC, Victoria Lipnic, employers, and business groups generally opposed the revised Form. They believed the additional reporting requirements were an unnecessary burden on employers and expressed concern that there would be no way to indicate aspects such as levels of experience of responsibility, which may dictate or influence an employee’s compensation on the revised Form. Overall, critics of the revised Form, although generally agreeing with the goal of achieving pay equality, thought that W-2 compensation data would provide a faulty and/or incomplete picture.
We will provide updates as this matter further unfolds. If you have any questions about employer reporting requirements or other compliance matters, please contact one of our employment attorneys for assistance. Stites & Harbison assists clients of all sizes, including publicly traded corporations, privately held companies, and small businesses alike.