The Equal Employment Opportunity Commission (EEOC) has made its decision on which two years of data it will collect for a newly required component of the annual EEO-1 report. And although the agency has set a September 30 deadline for submitting that data, it also is appealing the court ruling that requires employers to submit it.
The EEOC announced on May 2 that it will collect pay and hours-worked information—known as Component 2 data—for 2017 and 2018 as part of the annual EEO-1 report and the data is due by September 30. Then the agency announced its appeal on May 3 but noted that the appeal does not put the filing deadline on hold. The EEOC’s notice advises employers that are required to submit EEO-1 reports to go ahead and begin preparations for submitting Component 2 data. The agency also notes that it won’t be prepared to accept submissions until mid July.
In previous years, employers just had to submit Component 1 data—race/ethnicity, gender, and job category information. But the Obama administration added the new Component 2 requirement for employers with at least 100 employees to help the EEOC and the Office of Federal Contract Compliance Programs identify pay disparities across industries and occupations. The purpose of collecting EEO-1 reports is to help the EEOC gauge compliance with federal equal employment opportunity laws.
Before Component 2 went into effect, the Trump administration issued a stay, claiming the new requirements were too burdensome. In March, a federal district judge hearing a lawsuit filed by the National Women’s Law Center ordered the stay lifted and set a May 31 deadline for submission of Component 1 data.
In April, the judge ruled that the Component 2 data would be due September 30 and allowed the EEOC to decide which two years of data to collect—2018 and 2019 data, or 2018 and 2017 data.
On May 2, the EEOC announced it would collect 2017 data along with the 2018 data, and the deadline will be September 30. The agency also said it won’t be ready to accept Component 2 submissions until mid-July.
Tough Task Ahead for Employers
The new requirement is expected to present a challenge to most employers. Nita Beecher, an attorney with Fortney & Scott, LLC in Washington, D.C., says, “Based on some surveys we have seen, about 75% of employers don’t believe they will be able to comply by September 30, 2019,” she says, and many questions need to be answered before employers can submit accurate pay and hours-worked data.
The EEOC has said it will have to use a contractor to collect the Component 2 data, and Beecher says her firm will reach out to the agency to see if questions from employers can be submitted to the contractor so the data collection can go as smoothly as possible.
The judge’s ruling left it up to the EEOC to decide whether to collect 2018 and 2017 or 2018 and 2019 data to satisfy the requirement to collect two years of Component 2 data. If the agency had decided to collect 2018 and 2019 data, the 2018 data would have been due September 30, but the 2019 data wouldn’t have been due until March 31, 2020.
Beecher says the September 30, 2019, deadline for both years makes employers’ work more difficult. “This is new data collection, which has never been done before, so having to submit 2017 data makes the process even more challenging,” she says.
Advice for Employers
Beecher, coeditor of Federal Employment Law Insider, advises employers to use December 31, 2018, for their snapshot date “so that the data for 2018 will be as close to W-2 data as possible.”
“As to 2017 data, employers should immediately figure out how they are going to pull together the 2017 W-2 and hours-worked data and what issues this will raise for them,” Beecher says. “Many issues are currently unclear, so employers should focus on determining what issues they need to resolve to provide 2017 and 2018 data by September 30, 2019.”
Tammy Binford writes and edits news alerts and newsletter articles on labor and employment law topics for BLR web and print publications.