Advocacy Alerts

EEOC Adding Pay Data to Annual Reporting Requirements... Expect Your Cost to Increase 

03-14-2018 15:14

Overview:

The Equal Employment Opportunity Commission (EEOC) announced plans to require employers with more than 100 employee submit compensation data to the EEOC beginning in 2017. They have proposed a new EEO-1 Form which will collect pay data by race/ethnicity and gender. The revised report will retain the existing 10 job categories (e.g. Executive and Senior-Level Officials and Managers. First/Mid-Level Officials and Managers, Professionals, Technicians, Sales Workers, Administrative Support Workers, Craft Workers, Operatives, Laborers and Helpers and Service Workers). Pay data will be reported using a new twelve pay band currently used by the Bureau of Labor Statistics in the Occupation Employment Statistics Survey.

The EEOC says its reason for seeking the pay data for employees is to “more effectively focus agency investigations, assess complaints of discrimination and identify existing pay disparities that may warrant further examination.” In other words, the EEOC intends to use this information to target employers for investigation into equal pay violations.

Issue at Hand:

The NGCOA recognizes the burden this reporting requirement will have on complying with the new requirements. The EEOC has estimated the increased cost of the reporting requirement to be $400 per employee, while other industry experts have the increased cost to be more than $600 per employee. The total employee counts include full-time, part-time and seasonal hires, which will result in more of our courses meeting the 100-employee threshold.

If the EEOC discovers a pay disparity, it intends to use the information to assess whether a disparity is caused by the part-time or full-time status if the respective employees, rather than by gender, race or ethnicity. In addition, the EEOC intends to use the hours worked to assess whether employees in protected classes are subject to discrimination in terms of hours instead of pay, with as employer habitually assigning more hours and overtime to some employees while denying it to others.

Recommended Action:

While at this time the change is a recommendation by the EEOC to Office of Management and Budget (OMB), the NGCOA recommends our members prepare for the September 2017 reporting requirement. Operators should audit their time-keeping protocols and policies to be sure that non-exempt employees are accurately recording “hours worked”. It also recommends they conduct a proactive pay equity analysis now to address any areas of concern before data is reported to EEOC.

The NGCOA will continue to follow this proposed reporting requirement and update members of any changes requiring revised actions.

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