Applicable to Employers with 100 or More Employees and Federal Contractors and Subcontractors

The U.S. Equal Employment Opportunity Commission (EEOC) issued on Friday, January 29, 2016, proposed revisions to the Employer Information Report (EEO-1) to require covered employers to report aggregate workforce compensation data. The EEOC indicates that the compensation data will assist the EEOC and other agencies in “identifying possible pay discrimination and will assist employers in promoting equal pay in their workplaces.”

Employers with 100 or more employees, and federal contractors and subcontractors that have 50 or more employees and contracts of $50,000 or more, have been required for a number of years to file the EEO-1 report each fall. The EEO-1 report to date has required covered employers each year to report a snapshot of their workforce broken down by EEO-1 job categories and numbers of women and minorities in each category. The EEO-1 thus requires covered employers to report numbers of employees, broken down by sex and ethnicity, in each of the following job categories: Executives & Senior Level Officials and Managers (Senior Management), First and Mid-Level Officers and Managers, Professionals, Technicians, Sales Workers, Administrative Support Workers, Craft Workers, Operatives, Laborers and Helpers, and Service Workers.

The proposed regulations would require employers with 100 or more employees, and federal contractors and subcontractors with 100 or more employees and contracts of $50,000 or more, to include aggregate data on pay ranges and hours worked for employees in each of the EEO-1 job categories. The first filing date for the compensation reporting would be September 30, 2017. The proposed regulations will be published in the Federal Register on February 1, 2016, and the public has until April 1, 2016, to submit comments.

The EEOC announcement specifies that the new compensation reporting will provide the EEOC and the Office of Federal Contract Compliance Programs (OFCCP) of the Department of Labor, which enforces regulations relating to federal contractors and subcontractors, with data to (i) evaluate “pay disparities across industries and occupations and strengthen federal efforts to combat discrimination”; (ii) “assess complaints of discrimination, focus agency investigations, and identify existing pay disparities that may warrant further examination.”

We encourage covered employers to proactively reach out to their employment law or federal contracts counsel to discuss the new EEO-1 reporting requirements, to evaluate the potential implications on company operations, and to design appropriate contract compliance strategies.