EEOC Closes EEO-1 “Component 2” Pay Data Collection; Upcoming Filing Requirements Not Yet Clear

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On February 10, 2020, the U.S. District Court for the District of Columbia approved the Equal Employment Opportunity Commission (EEOC)’s request to deem its retrospective collection of compensation data (the so-called “Component 2” information) for calendar years 2017 and 2018 completed, ending (at least for now) the federal government’s first-ever collection of pay data.  Employers’ obligations with respect to filing calendar year 2019 demographic data remain unclear.

Reporting Demographic Data:  2020 Schedule Uncertain

Like planting in the spring and harvesting in the fall, the annual filing of EEO-1 reports was—for nearly 50 years—a familiar part of an employer’s year.  Generally, each year employers with 100 or more employees, and federal contractors with 50 or more employees, are required to file the EEO-1 report, providing the EEOC with data on the number of individuals employed, their distribution by legal entity and location, and their demographic characteristics. The timing of these annual reports began to change, however, after the Obama administration in 2017 shifted the reporting cycle from a fall deadline to a deadline in the spring of the year following the end of the reporting period. 

The EEOC’s authority to collect EEO-1 information expired in September 2019 pursuant to the Paperwork Reduction Act (PRA), the federal law that controls all government information collection process forms used for general data collection.  The PRA provides that the Office of Management and Budget (OMB) must approve all information collections at least every three years. 

In a notice filed in September 2019, the EEOC informed OMB that it was only seeking approval of the Component 1 (demographic information) portion of the survey, and would not seek to collect compensation data in the next reporting cycle.  After filing that notice, the EEOC had to wait at least 60 days before it could submit forms for approval to OMB.  During that period, the public was permitted to file comments on the EEOC’s intentions.  Although the comment period closed on November 12, 2019, the EEOC has still not submitted its forms to OMB for approval.  Once the forms are submitted, there will be an additional 30-day period during which the public can again comment.

The 2019 EEO-1 survey cannot begin until the applicable forms have been approved.  It appears unlikely at this point that 2019 EEO-1 reporting forms will be approved much before May at the earliest.  At that time, the agency will set forth its required schedule for filing, which may set a reporting deadline of summer or perhaps even early fall. 

Under the most recent version of the instructions and report, employers were required to base their workforce reporting on a payroll period of their own choice from the fourth quarter of the calendar year.  At this point there is no reason to anticipate any change in that requirement. 

The Future of Pay Data Collections

Recall that the National Women's Law Center sued to compel the EEOC to proceed with the collection of compensation information that had been instituted under the Obama administration and later suspended by the current administration.  The district court ordered the EEOC to retroactively collect compensation data from EEO-1 filers for calendar years 2017 and 2018.  As noted above, with the approval of the district court, the EEOC’s collection of that data is at long last finished. 

While the EEOC has not sought approval to collect compensation data for 2019, the agency has indicated on its regulatory agenda that it will continue to look at the issue, and may propose a different means of collecting and analyzing employer payment practices in the future.  The EEOC has appealed to the U.S. Court of Appeals for the District of Columbia Circuit as to whether the lower court’s reinstatement of Component 2 was lawful in the first place.  And of course, as administrations change, prior proposals like Component 2 may be exhumed and revisited. 

Littler will continue to apprise of relevant developments.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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