March 25, 2020Client Alert

EEO-1 Status Update – Still No Filing Deadline but EEOC Making Progress

Like much of the country, most Equal Employment Opportunity Commission (EEOC) employees are working remotely. However, this change in operation status has not prevented the agency from moving forward with the steps necessary to begin collecting EEO-1 Component 1 demographic data for 2019, 2020, and 2021. On Monday, March 23, 2020, the EEOC published a Notice of Information Collection in the Federal Register. This Notice is required to obtain Office of Management and Budget (OMB) approval of the EEO-1 form for the next three annual filings. The public has until April 22, 2020 to comment on the EEOC’s request to continue collecting EEO-1 Component 1 data but no longer collect Component 2 data. Even if the OMB quickly approves the EEOC’s request, the EEO-1 report would not be due until sometime after May 1, 2020, and if the EEOC follows its practices to date, it will give companies two or three months after the database opens to file their forms. The EEOC has promised to announce the new filing deadline on their website and send a notice to employers once it is established.

Perhaps the most significant aspect of the EEOC’s request is that, like the Paperwork Reduction Act Notice the agency published in September 2019, the agency does not seek to renew authority to use the EEO-1 Component 2 form to collect compensation data. In reaching this decision, the EEOC relied on its own review of the pay data collection methodology and the concerns expressed by commenters in concluding that the burden on companies in completing Component 2 outweighed any utility the collection had in helping the EEOC combat compensation discrimination. The flaws highlighted by commenters included the fact that using W-2 Box 1 wages, which include pay for hours not worked, and average hours worked, would result in “inaccurate and misleading comparisons.”

The end of Component 2 does not necessarily mean the end of compensation data collection forever. The EEOC remains committed to combatting compensation discrimination. However, if it elects to “pursue pay data collection in the future,” the agency will do so through “using notice and comment rulemaking with a public hearing.”

The public notice also had a reminder for employers about what the EEOC does with the EEO-1 Component 1 data. These uses include conducting analyses of the demographics of industries and regions; as well as providing company-specific demographic data, as EEOC investigators start to analyze discrimination charges. In addition, the Office of Federal Contract Compliance Programs (OFCCP) currently uses EEO-1 data as a method to identify all affiliated companies and locations of federal contractors for potential audit. In the past, the OFCCP also considered changes to a company’s demographics and employee counts from year to year when developing the list of contractors subject to audit.

Finally, the EEOC discussed the meaning of the Title VII prohibition on making EEO-1 data public before a Title VII proceeding is instituted. Because the EEO-1 Component 1 data is collected under both Title VII and Executive Order 11246, the OFCCP has access to the data for any company that identifies on the form as a prime contractor or first-tier subcontractor. The EEOC also shares the information, upon request, with local fair employment practice agencies that are investigating charges against a company. Notably, the EEOC also is “exploring secure mechanisms to facilitate access” to EEO-1 information by “approved researchers” for statistical purposes.

Information on how the EEOC, OFCCP, and state FEP agencies will conduct their operations during the COVID-19 pandemic can be found here.

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