EEOC Will Collect Pay Data From W-2s

Sep 29 2016 - Reporting Requirements - HRWatchdog

collect pay data w2 eeoc

Future EEOC-1 reports will require pay data.

Today, the Equal Employment Opportunity Commission (EEOC) announced approval of a revised EEO-1 report that will require large employers to report pay data to the agency, including aggregate information from employee W-2s.

The first deadline for the new 2017 EEO-1 report will be March 31, 2018, which gives employers 18 months to prepare. The EEO-1 report will be due every March 31 after that — a change from the current deadline date.

This revision does not impact the 2016 EEO-1 report, which is due on September 30, 2016, and is unchanged. 

As previously reported, the EEOC is collecting pay data to assist the agency in identifying pay disparities that warrant investigation into potential pay discrimination. “Collecting pay data is a significant step forward in addressing discriminatory pay practices. This information will assist employers in evaluating their pay practices to prevent pay discrimination and strengthen enforcement of our federal antidiscrimination laws” said EEOC Chair Jenny R. Yang.

Under the new reporting requirements:

  • Private employers including federal contractors and subcontractors with 100 or more employees will report summary pay data. Under no circumstances should employers report individual pay or salaries or any personally identifiable information.
  • Federal contractors and subcontractors with 50–99 employees will not report summary pay data, but they will continue to report employees by job category as well as by sex, ethnicity and race as they do now.
  • Employers with 99 or fewer employees and federal contractors and subcontractors with 49 or fewer employees will not be required to complete the EEO-1 report as is current practice.

Employers will provide information by job category and sex, ethnicity and race using twelve different “pay bands” or salary ranges identified on the EEO-1. To choose the correct pay band, the employer will refer to the employee W-2 earnings.

Example from the EEOC: A financial services firm may report that it has 10 Professionals in pay band 6, which is $49,920 – $62,919, who are men and black; and that it also has 35 Professionals in pay band 6 who are men and white.

According to the EEOC, it does not disclose EEO-1 data for a specific employer; it only publishes large-scale aggregated EEO-1 data. The EEOC states that it has “strict procedures in place to protect the confidentiality of EEO-1 data, including summary pay data.”

Resources for employers:

Gail Cecchettini Whaley, CalChamber Employment Law Counsel/Content

As the EEOC’s new rule demonstrates, the issue of fair pay continues to be a focus at both the state and federal levels.

CalChamber members can find more information about California law on the HR Library’s California’s Fair Pay Act page. Not a member? See how CalChamber can help you.

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