How Do You Spell Relief? E-E-O-1
On May 7, 2020, the Equal Employment Opportunity Commission (EEOC) announced that, due to the impact of COVID-19 on workplaces, it would delay collection of EEO-1 reports nearly a year – until 2021. The agency plans to start collecting 2019 and 2020 EEO-1 data in March of 2021.
To refresh the memories of our readers, all private sector employers with 100 or more employees; or employers who have 50 or more employees and are prime contractors or first-tier subcontractors of the federal government in amounts of $50,000 or more; or that serve as a depository of government funds in a financial institution selling U.S. savings bonds (yes, they still sell those) must annually file an EEO-1 report.
The EEO-1 report is a compliance survey mandated by federal statute. The survey requires company employment data to be categorized by race/ethnicity, gender and job category. A sample copy of the EEO-1 form and instructions is available here. For government contractors who file EEO-1 reports, the data is also shared with the Office of Federal Contract Compliance Programs of the U.S. Department of Labor and is used in compliance monitoring of contractors’ affirmative action obligations.
The EEOC has even more good news for employers. The May 7 announcement also stated that when EEO-1 data collection resumes next year, it will no longer include Component 2 compensation and hours worked data. In 2016, then-President Obama announced a plan to use the EEO-1 to assist in ending the gender wage gap. Since then, the EEOC sought to add a Component 2 section to the EEO-1, which would require employers to report employees’ W-2 earnings, as well as hours worked.
The data was to be reported in an aggregated fashion into 12 pay bands for the 10 EEO-1 job categories. For a variety of reasons, the addition of Component 2 was both controversial and generally disfavored by employers. Much litigation ensued over the ability of the EEOC to collect such data. Since President Trump took office in 2019, there has been pullback from the government about the need to collect pay data.
Employers who are required to file EEO-1 need to stay tuned to subsequent changes between now and 2021. Much could change in the interim, especially if the Democrats win the presidency in November.