As we reported during our spring edition of Employment Law Update, the Equal Employment Opportunity Commission’s (the “EEOC”) new requirement that EEO-1 reports contain pay data, set to begin in 2017, was poised to be administratively time-consuming. The agency initially proposed that employers report employees’ compensation data and submit the EEO-1 report by September 30 for the current year. To do so, employers would have been required to use the pay data from the 12-month period beginning in a pay period between July and September of the prior year, as selected by the employer. Such a requirement would have precluded employers from merely using the annual Form W-2 data, and instead forced them to conduct a new analysis.
Fortunately, in response to opposition by the business community, the EEOC has backed off of this burdensome requirement by making important changes. The EEOC will now require employers to report data on a calendar-year basis, so that employers will not be required to run a separate analysis to determine off-year W-2 data. Employers may use the same pay information that appears on the annual Form W-2. As part of this change, for the 2017 reporting period, EEO-1 reports will be due on March 31 of the following year to give employers time to reconcile their calendar-year data — meaning the first time employers will report pay data is on March 31, 2018. While reporting pay data as part of the EEO-1 will still require additional administrative resources, this change goes a long way toward easing the burden on employers.