EEOC Suspends Pay Reporting Obligations

As predicted under the new administration, the Office of Management and Budget and Office of Information and Regulatory Affairs informed the Equal Opportunity Commission (EEOC) that it is suspending the revised EEO-1 form. This revised EEO-1 form was established by the EEOC under the Obama Administration in an effort to compile employer pay data to investigate claims of pay discrimination.

Under the September 2016 revised EEO-1 form, employers with over 100 employees were required to report pay information and total hours worked for all employees by race, ethnicity, and sex within 12 proposed pay bands. Employers are currently using the prior version of the EEO-1 form for 2017. This report is still due by March 31, 2018, but does not require employee pay disclosures.
In the Memorandum to the EEOC it states that the decision to eliminate the pay disclosure requirement was based on “good cause,” believing that the collection of this additional information would be contrary to the Paperwork Reduction Act. Furthermore, the Office of Management and Budget (OMB) believed that the additional pay data reporting requirements “lack practical utility, are unnecessarily burdensome, and do not adequately address privacy and confidential issues.”

In order to justify the new pay data requirement, the OMB has requested the EEOC to submit a renewed proposal for the pay data information that will be collected for the EEO-1 form. It is not entirely clear what information the EEOC will have to provide to justify the original pay disclosure approach. However, the Acting Chair, Victoria Lipnic, needs to be convinced that requiring employers to provide pay disclosures is not overly burdensome and contradictory to the Paperwork Reduction Act.

On September 6th the EEO-1 Joint Reporting Committee clarified the details for the 2017 EEO-1 Report. The deadline to file the EEO-1 report for 2017 is March 31, 2018; the 2017 EEO-1 Reports must be based on a payroll period in October, November or December; and employers may use the same EEO-1 form used in 2016.

Employers and human resource departments should breathe a sigh of relief regarding the fact that they do not have this burden of not only collecting, but also accurately reporting pay data.