September 17, 2019

September 17, 2019

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September 16, 2019

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Mergers and Acquisitions and Other Guidance Published for Component 2 Pay Data Reporting

In an effort to provide additional guidance to employers navigating the new Component 2 pay data filing requirements, the Equal Employment Opportunity Commission (EEOC) and NORC have just updated its frequently asked questions (FAQs) with respect to how employers experiencing mergers, acquisitions, and spinoffs during 2017 and 2018 should be filing their 2017 and 2018 Component 2 reports.  Additionally, the EEOC has included new information on filing obligations for Professional Employer Obligations (PEOs).   in addition to the website materials, we understand messages to the NORC HelpDesk are being returned promptly.

The new FAQs provide the following guidance:

Mergers & Acquisitions

Regarding mergers and acquisitions, the general expectation is – whether the event occurred before or after the employer’s selected 2017 workforce snapshot – the acquiring/new employer submit 2017 Component 2 data for the acquired subsidiary or the newly formed company.  In some instances, the company experiencing a merger or acquisition will not have access to the former company’s data.  If that is the case, the company should note this in the comments box under the certification section of the Component 2 online filing system.

Spinoffs

Where a company spins off from another in 2018, the spinoff company is not responsible for filing 2017 Component 2 data for its employees, as it was still affiliated with the former parent company at that time.  Instead, the former parent company would be responsible for filing 2017 Component 2 data for those employees, and the newly formed Company would be responsible for its 2018 Component 2 data.  Alternatively, parent companies selling a portion of their business in 2018 are not required to file 2017 and 2018 Component 2 data for those employees – that becomes the purchasing company’s obligation.  Again, should data access issues arise, companies are advised to note this in the online filing system.

PEOs

The EEOC has advised that a PEO is not responsible for filing Component 2 data of entities that are former clients at the time of filing.  Further, when a PEO and a client company’s contracting agreement does not include 100% of the covered client company’s employees, the covered client company – not the PEO – is responsible for filing Component 2 data.

Jackson Lewis P.C. © 2019

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About this Author

Laura Mitchell, Jackson Lewis, Management Representation lawyer, Contractual Drafting Attorney
Principal

Laura A. Mitchell is a Principal in the Denver, Colorado, office of Jackson Lewis P.C. She represents management exclusively in all areas of employment law, focusing on affirmative action and government contractor compliance.

Ms. Mitchell is a Principal in the firm’s Affirmative Action and OFCCP Defense practice group, representing government and non-government contractors in Office of Federal Contract Compliance Programs (OFCCP) matters, preparing for and defending OFCCP audits, and counseling employers on issues stemming...

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Associate

Suzanne Donnelly Corwin is an Associate in the Denver, Colorado, office of Jackson Lewis P.C. Ms. Corwin’s practice focuses on equal employment opportunity and affirmative action. She assists clients with developing affirmative action plans and counsels them on compliance with Office of Federal Contract Compliance Programs (OFCCP) regulations. She also defends clients during OFCCP investigations and audits.

While attending law school, Ms. Corwin was an Executive Comment and Note Editor on the New England Law Review and was named a New England Scholar for excellence in academic achievement. She also served as an honors judicial intern at Suffolk Superior Court in Boston, Massachusetts. Upon graduation, Ms. Corwin clerked for the Justices of the New York State Supreme Court, Appellate Division, Third Department in Albany, NY. 

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