UPDATE: On May 3, 2019, the U.S.
Equal Employment Opportunity Commission (EEOC) confirmed that employers will be
required to submit Component 2 pay data for years 2017 and 2018 to the
EEOC by September 30, 2019.
By September 30, 2019, companies with over 100 employees
must turn into the Equal Employment Opportunity Commission (EEOC) their
employees’ payroll data (earnings and hours worked) as part of their
annual workforce data report, also known as an EEO-1. The EEOC hopes to
identify pay gaps which may be caused by discrimination based on sex (gender),
race and ethnicity by having the payroll data. Companies with over 100
employees must submit payroll data, organized into categories of race, sex and
ethnicity sorted by job categories. The information is further sorted
into 12 pay bands for each job category which is supposed to show the
applicable pay rates based on the company’s diversity.
Employer groups estimate that the reporting burden of this
payroll data to the EEOC would cost companies around $1.3 Billion
annually. The EEOC will determine by May 3 whether to request payroll
data from employers for 2017 and 2018, or from 2018 and 2019. If
the EEOC selects payroll data for 2017 and 2018, the two years of pay data must
be reported on the EEO-1 by September 30, 2019. If the EEOC selects 2018
and 2019 as reporting years, the 2018 payroll data will be due by September 30,
while 2019 data will be reported in the Spring of 2020. There are currently
no monetary fines, penalties or debarment for failing to submit the EEO-1
report, but the EEOC does have the ability to file a lawsuit against any
employer to force compliance.
Reporting this payroll data will be an extensive undertaking
that employers with over 100 employees should start preparing for now.
Feel free to contact Nick Nykulak or Lynn Schonberg with any questions you may