On September 29, 2016, the EEOC announced that beginning in March 2018, they will begin collecting summary pay data from certain employers in addition to the data already collected for the EEO-1 Report. Private employers, including federal contractors and subcontractors, with 100 or more employees will be required to submit summary pay data on their EEO-1. The reporting requirements remain the same for those employers with 99 or less employees, including federal contractors and subcontractors.
The new requirements consist of two elements summary pay data and aggregate hours worked. First, employers must report the total number of full- and part-time employees they had during that year in each of 12 pay bands listed for each EEO-1 job category. The pay bands range from a low of $19,239 and under to a high of $208,000 and over. To identify the proper pay band in which to count an employee, the employer will rely on the pay reported for income tax purposes that year in Box 1 of the employees W-2 form. Second, employers must tally and report the number of hours worked that year by all the employees accounted for in each pay band. The hours worked will be counted by reviewing the records already required by the Fair Labor Standards Act. For non-exempt employees, the employer will consult the records identifying the actual hours worked. For exempt employees, the employer may either report 20 hours for each part-time and 40 hours for each full-time employee or report the actual hours worked by both full- and part-time employees.
In addition to the two new elements, the workforce snapshot period has been changed to October 1 through December 30, 2017. The first deadline for the new 2017 EEO-1 report will be March 31, 2018, giving employers a full 18 months to prepare the reports.
According to the EEOC, the hope with these new reporting requirements is that the information gathered will improve investigations of possible pay discrimination, a contributing factor in wage gaps. While the Equal Pay Act of 1963 and the Civil Rights Act of 1964 prohibit pay discrimination on the basis of sex, race, ethnicity and other protected classes, equal pay remains an issue in many industries. The EEOC believes that this new practice will allow employers to evaluate their pay practices to prevent pay discrimination in their workplace.
Although the EEOC maintains that it will not disclose the EEO-1 data for any specific employer, the large scale aggregated EEO-1 data will be published. Employers are also reminded not to report any individual pay or any personally identifiable information.
If you have a question, the St. Louis employment attorneys at McMahon Berger have been representing employers across the country in labor and employment matters for over sixty years, and are available to discuss these issues and others. As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation as every situation must be evaluated on its own facts. The choice of a lawyer is an important decision and should not be based solely on advertisements.