New EEO-1 Form Which Would Have Required Companies to Report Pay Data Reconsidered
march 3, 2017
In September of 2016, the EEOC released an updated EEO-1 reporting form, which would require employers with 100 or more employees to provide employee pay data starting in 2017. The final regulations would require employers to include employee pay data including aggregate W-2 income by gender, race, ethnicity, and job group in their annual EEO-1 reports.
According to the EEOC, the goal of the data collection is to eliminate pay discrimination. The EEOC maintains that such discrimination remains undetected due to the lack of accurate information about employee pay. Furthermore, the pay data would be used as a tool to identify discriminatory pay practices to ensure that fair pay practices are put in place.
Advocates for employers claim that the collection of pay data would not help to identify unlawful pay discrimination. Rather, "[o]ver time, pay is increasingly influenced by an employee's chosen career path—previous jobs, experience, education, performance and geographic locations, along with level of responsibility," said Janese Murray, vice president of diversity and inclusion at Exelon Corp.
On January 25, 2017, President Trump designated a new EEOC chair, Commissioner Victoria Lipnic, who voted against the newly proposed pay data collection rule. President Trump will also have the opportunity to nominate two EEOC Commissioners prior to the March 31, 2018 deadline for the collection for pay data.
To ensure fair pay, it is recommended that business conduct self-audits to determine whether any pay disparities amongst employees exist.