On April 25, 2019, the U.S. District Court for the District of Columbia ordered the U.S. Equal Employment Opportunity Commission (EEOC) to collect detailed data on employee compensation and hours worked from covered employers sorted by job category, pay band, race, ethnicity, and gender (the so-called “Component-2” of the EEO-1 form) by September 30, 2019. The court ordered the agency to collect this data for calendar year 2018.
The court also ordered the agency to collect a second year of pay data, but gave the EEOC the option of either: (a) collecting retrospective 2017 data by September 30, 2019, or (b) collecting 2019 compensation data in the normal 2020 EEO-1 reporting period (which would make it due by March 31, 2020). The EEOC must inform the court by May 3, 2019 if it chooses to elect that option. Finally, the court held that approval of the revised form was extended through April 2021, and ordered the EEOC to begin immediately implementing steps to collect the data, notify employers of these requirements, and report to the court on its status in doing so on a continuing basis.
Earlier, the EEOC had indicated that it was unable to comply with the court’s prior ruling requiring this data to be collected by May 31, 2019, but that via the use of private contractors, the agency would be able to collect data for calendar year 2018 by September 30, 2019. The EEOC further informed the judge that an attempt to collect two years of data (2018 and 2017 retrospectively) would likely result in decreased response rates and an unacceptable risk to the quality of data received. Given Thursday’s ruling, the court appears to have been persuaded by some, if not all, of the EEOC’s arguments. In the wake of this decision, we expect the EEOC to provide additional guidance for employers shortly.
There is, of course, the possibility that the government may appeal and/or seek a stay of the court’s decision. Absent such action, however, it appears that covered employers may be required to report this compensation data, at least for the periods of time covered by the court’s order.
In general, private employers with 100 employees or more that are subject to Title VII of the U.S. Civil Rights Act of 1964 are required to file Form EEO-1 (including both traditional “Component-1” data, which reports workforce demographics by job category, race, ethnicity, and gender, and now the new Component-2 data). Federal contractors that are otherwise required to file Form EEO-1 will only be required to file Component-2 data if they have 100 or more employees (covered federal contractors with 50-99 employees are required to file Component-1 only). Component-2 includes annual W-2 (box 1) compensation sorted by pay band, and annual hours worked.
Notably unchanged for all employers, the EEO-1 portal is open for the collection of Component-1 data, and employers should be preparing to submit that data in normal course to the EEOC by May 31, 2019.
We will provide further information on the mechanics of filing Component-2 as soon as any becomes available. Littler's Workplace Policy Institute (WPI) continues to analyze options with respect to the court’s ruling, including the possibility of an appeal to challenge the court’s orders.