The United States Equal Employment Opportunity Commission (“EEOC”) has published proposed revisions to the requirements associated with the Employer Information Report (EEO-1). The EEO-1 already requires employers with more than 100 employees to provide certain employment information to the federal government, including the ethnic, racial and gender breakdown of their employees.  The proposed revisions would require employers to include in their EEO-1 reports information regarding aggregate data on pay ranges and hours worked. 

The addition of this data to the required reporting is intended, according to an EEOC press release, to “assist the agency in identifying possible pay discrimination and assist employers in promoting equal pay in their workplaces.” The proposed revisions are currently available here. If ultimately approved, the new requirements would go into effect in September 2017. It is estimated that the requirements would apply to upwards of 63 million employees nationwide.

Though the proposed rule at this point remains just that—a proposal—the changes are consistent with continuing legislative and regulatory efforts to address pay disparities; particularly in regard to gender. The announcement of the proposed changes by the EEOC and the White House came in conjunction with the seventh anniversary of the Lily Ledbetter Fair Pay Act (which President Obama signed into law in 2009), and in the wake of other recent efforts to address pay gap issues; perhaps most notably California’s Equal Pay Act, which went into effect January 1, 2016.  (See our prior post on California’s equal pay compliance rules here)

The new pay data reporting requirements will require employers to ensure they have a system in place with which they can both track and document data regarding the pay ranges and hours worked of their employees; and distill that information in order to comply with the new reporting requirements. The EEOC has published the proposed pay data collection form, which will require employers to provide the numbers of employees of different races, ethnicities and genders that fall, respectively, into each of a series of twelve compensation ranges; as well as the numbers of hours worked by those employees.  The proposed form is available here.

We will continue to update you on further developments as the proposed rules are finalized. In the meantime, employers are encouraged to submit written comments prior to April 1, 2016 and begin to explore what steps they may need to take now to ensure they are able to track and provide the necessary data by the time the new reporting requirements take effect.

Sheppard Mullin’s Labor & Employment group has put together a team of experts ready to assist clients assess and maintain compliance with increasing state and federal regulations surrounding pay equity. For more information, contact Partner Kelly Hensley in our Los Angeles office.