After a period of uncertainty surrounding employer obligations, the Equal Employment Opportunity Commission (EEOC) has announced that it will collect EEO-1 pay data information for the calendar years of 2018 and 2017. Covered employers will be required to submit this information by September 30, 2019.
In addition to EEO-1 pay data, referred to as Component 2 of the survey, the agency will still be collecting Component 1 data earlier in the year. This means that covered employers will have two different deadlines for EEO-1 survey compliance.
EEO-1 Job Category Data: Component 1 Requirements
The EEO-1 survey in its current form collects employment data from private employers for a representative pay period of the previous year, categorized by race/ethnicity, gender, and job category. This data is referred to as Component 1, and is used by EEOC and the Office of Federal Contract Compliance Programs (OFCCP) to identify patterns of potentially discriminatory practices and set civil rights enforcement priorities.
EEO-1 Component 1 survey compliance is required from the following employers:
- Private companies with 100 or more employees.
- Private companies which are owned or corporately affiliated with another company, of which the entire enterprise employs 100 or more employees.
- Federal contractors with 50 or more employees and are operating under a prime contractor or first-tier contract amounting to $50,000 or more.
Covered employers are required to submit Component 1 data for the calendar year 2018 by May 31, 2019. The online portal for submission of Component 1 data is currently open.
EEO-1 Rules: Component 2 Controversy
In 2016, EEOC finalized new regulations which would require most covered employers to submit summary wage and hour data for each of 10 job categories and 12 categories of gender, race, and ethnicity. Thomas E. Perez, then in the position of U.S. Secretary of Labor, stated that collecting pay data was a “critical step” in making equal pay a reality: “Better data will not only help enforcement agencies do their work, but it helps employers to evaluate their own pay practices to prevent pay discrimination in their workplaces.”
Covered employers would have been required to submit Component 2 pay data for the first time in March of 2018. However, in August of 2017 the Office of Management and Budget issued a stay on the new requirements, stating that file specifications for pay data collection which were released following the publication of the Final Rule required further review since they were not provided in the original proposed rule.
Soon after OMB paused the implementation of the rule, the non-profit National Women’s Law Center (NWLC) sued EEOC and OMB. On March 4, 2019, the U.S. District Court for the District of Columbia vacated OMB’s stay of the EEOC pay data rule, stating that the agency’s decision was “arbitrary and capricious.” The court found that OMB’s justification for the stay did not meet the regulatory requirements of its own agency, which allow OMB to review information that it had previously approved only when “relevant circumstances have changed or the burden estimates provided by the agency at the time of initial submission were materially in error”(5 C.F.R. § 1320.10(f)).
The court ordered the rule to go into effect as originally approved, meaning that EEOC must collect Component 2 data for 2017, as originally required, as well as for 2018.
EEO-1 Pay Data: Component 2 Requirements
Since the rule was overturned, EEOC has been working to determine how and when to collect the necessary data. On May 3, 2019, EEOC published a notice in the Federal Register stating that covered employers are required to submit Component 2 data for the calendar years of 2017 and 2018 by September 30, 2019.
EEO-1 Component 2 survey compliance is required from the following employers:
- Private companies with 100 or more employees.
- Private companies which are owned or corporately affiliated with another company, of which the entire enterprise employs 100 or more employees.
- Federal contractors with 100 or more employees and are operating under a prime contractor or first-tier contract amounting to $50,000 or more.
The agency expects to begin collection EEO-1 Component 2 data starting in mid-July of 2019. Employers can check the 2018 EEO-1 Survey page for ongoing updates and more information about EEO-1 survey compliance.
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