A federal judge has agreed to extend the deadline for employers to disclose employee pay data under Component 2 of the Employer Information Report (EEO-1).
The extension shifts the deadline for EEO-1 Component 2 data for the years 2017 and 2018 to September 30, 2019. EEO-1 Component 1 data are still due on May 31, 2019.
The order from the U.S. District Court for the District of Columbia follows its ruling in March holding that the Trump administration, acting through the Office of Management of Budget (OMB), lacked reasonable grounds to stay the EEOC’s pay data collection obligations. This is the second extension of EEO-1 data since the court reinstated the rule requiring the collection of Component 2 data in March 2019.
Background on Pay Data Reporting
Originally announced by the EEOC in September 2016 at the twilight of the Obama administration, pay data was added to the existing employee information that certain private employers and federal contractors must annually report to the federal government in their EEO-1 compliance surveys.
The underlying policy behind the rule aimed to improve investigations of possible pay discrimination and close the gender and race wage gaps. The rule, effective March 2018, required the reporting of W-2 wages and total hours worked in the prior year for all employees in twelve proposed pay bands.
In August 2017, the Trump administration acted through the OMB to initiate a review and stay of the EEOC’s new collection of pay data, claiming that the EEOC failed to comply with federal rulemaking requirements and imposed unlawful and burdensome collection obligations inconsistent with the Paperwork Reduction Act.
Two months later, a women’s advocacy group and a Latin American trade union joined forces and filed suit against the OMB decision, arguing that the suspension of pay data collection would harm their policy goals of achieving pay equity across race and gender wage gaps.
On March 4, 2019, in National Women's Law Center v. Office of Management & Budget, the District Court vacated the Trump administration’s stay of the pay data rule. The court held that the Trump administration acted in an arbitrary and capricious manner in staying the rule and that the government’s decision lacked any reasoned explanation. As such, the government’s decision to stay the requirement to collect pay data could not stand.
After the court’s decision, the EEOC announced it would be extending the EEO-1 deadline until May 31, 2019 because of the partial government shutdown. The order extends deadlines further only for Component 2 Data, until September 30, 2019.
Employers Subject to EEO‐1 Reporting
The EEO‐1 is an annual survey that applies to the following employers:
- All private employers subject to Title VII of the Civil Rights Act of 1964 with 100 or more employees, but not including state and local governments, primary and secondary school systems, higher education institutions, Indian tribes and tax‐exempt private membership clubs other than labor organizations;
- All private employers subject to Title VII who have fewer than 100 employees if the company at issue is owned or affiliated with another company, or there is centralized control or management (such as central control of personnel policies and labor relations) so that the group legally falls into a single enterprise, and the entire enterprise employs 100 or more employees; and
- All federal contractors who have 50 or more employees and (a) are prime contractors or first‐tier subcontractors, and have a contract, subcontract or purchase order amounting to $50,000 or more; or (b) serve as a depository of federal government funds in any amount; or (c) is a financial institution which is an issuing and paying agent for U.S. Savings Bonds and Notes.
Any federal contractors subject to the exemptions under 41 C.F.R. § 60‐1.5 (e.g., contracts involving work performed outside the United States, certain contracts with state and local governments, contracts with religious corporations, associations and educational institutions) are not required to submit EEO‐1 data. Further, those employers and/or contractors located in Puerto Rico, the Virgin Islands or other American Protectorates are exempt from EEO‐1 reporting requirements altogether.
Required EEO‐1 Data
Founded on Title VII’s record-keeping requirements, the EEO‐1 report is a compliance survey that requires applicable employers to electronically submit via an online portal employment data about race/ethnicity, gender, job categories and office locations. The EEOC has made available an Instruction Booklet as well as a sample EEO‐1 reporting form as guidance for applicable employers. The EEOC is prohibited from disclosing the data to the public. However, federal government prime or first‐tier subcontractors should note that their data is subject to disclosure. All such requests must be directed to the Office of Federal Contract Compliance Programs in the U.S. Department of Labor.