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New EEOC Pay Reporting Requirements Begin Next Year

On September 29, the EEOC finalized a revised pay data form  that employers and federal contractors with 100 or more employees will be required to submit on an annual basis beginning March 31, 2018, based on data collected for 2017.  Private employers with more than 100 employees and federal contractors with more than 50 employees have long been required to report employee race, ethnicity and sex to the EEOC based on 10 different job categories.  Now employers who meet the 100 employee threshold are required to submit additional information regarding compensation and hours worked for employees in each of the same categories.

When Do Changes Take Effect?

Changes take effect for the 2017 reporting period.  The first reporting deadline is March 31, 2018.  Reports are due on March 31, every year after.

Reporting Requirements

The 10 job categories (professionals, service workers, etc…) are divided into 12 pay bands ($19,239 and under, $19,240-$24,439 etc…).  Compensation data is then taken from an employee’s W-2 Box 1 income and an employer must report that it employs “x” number of employees of a particular race, ethnicity and sex in “y” job category who are in “z” pay band.

Employers must also report the aggregate number of hours worked by all employees in each of the job categories and pay bands.  For exempt employees, employers can either report 40 hours per week for full-time employees and 20 hours per week for part-time employees, or the actual hours worked.  No individual pay or salary data is collected.

How to Report

Employers will continue to submit reports to the Joint Reporting Committee of the EEOC and the Office of Federal Contract Compliance Programs via the EEO-1 Online Filing System on the EEOC’s website.  Electronic submission of data files is also available.

Proponents of the pay reporting requirements argue that the new form will allow for detection of discriminatory pay patterns among employers and in some cases, provide businesses with an opportunity to self- regulate and correct practices internally before they become an external problem.  But those opposed say the measure is just one more burden for employers that serves no useful purpose.  Concerns about the cost of gathering information and the lack of framework for reviewing and using the data remain largely unaddressed.

More information regarding the new requirements can be found on the EEOC’s Questions and Answers About the Revised EEO-1 and Summary Data Plan page.

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