President Obama and the U.S. Equal Employment Opportunity Commission are attempting to obtain pay information from employers as part of the Obama Administration’s ramped up effort to combat the perceived compensation gap in employment, the EEOC announced on January 29, 2016. For those employers with 100 or more employees, which are required to file an EEO-1 report annually with the EEOC, the proposal would require employers to include wage information so it can be determined where there is a wage gap based on gender, race or ethnicity.
The proposal was published in the Federal Register on February 1st, and there will be a sixty day public comment period, which will end on April 1st. Anticipated implementation date is September 30, 2017.
Not only will this new proposal create an additional burden on employers, it could lead to providing the EEOC with information to bring an action against an employer without even having an employee complaint. Moreover, just reporting W-2 wages can be misleading and taken out of the context, since many factors go into establishing a salary, including seniority and education level, which will not be indicated on the EEO-1 report.
Employer groups have expressed concern that providing confidential wage information to the EEOC could become available to their competitors through a request pursuant to the Freedom of Information Act, notwithstanding the EEOC’s assurance that it will keep employers’ pay data confidential.
This announcement once again reflects the Obama Administration and the EEOC’s increasingly proactive role in attempting to go out and find evidence of supposed discrimination, as opposed to simply adjudicating claims that are brought before it.