Guidance: The EEOC recently announced a proposal that would require federal contractors and to all employers with more than 100 workers to provide pay data on EEO-1 forms. The proposal would require covered employers to identify employees’ total W-2 earnings for a 12-month period looking back from a pay period between July 1 and September 30, and then report, by race, gender and job category, the number of employees whose earnings for the prior 12 months fell within each of 12 pay bands. The proposal, according to the EEOC, is designed to assist the agency in identifying possible pay discrimination and assist employers in promoting equal pay in their workplaces . The public comment period on the proposed changes will remain open until April 1, 2016. If approved, the proposed changes would take effect for the September 2017 reporting period.
Impact: This proposal signals to employers that the EEOC and the Office of Federal Contract Compliance Programs (OFCCP) intend to increase their focus on wage-related concerns, including regulatory compliance for federal contractors and pay discrimination by all covered employers. As such, before the EEOC’s proposed rule takes effect, employers should consider conducting privileged audits of their pay practices to ensure compliance with the relevant laws and regulatory requirements. Further, employers should assess their compensation tracking systems to ensure that they are set up to provide the pay data required by the new EEO-1 form.