The U.S. Equal Employment Opportunity Commission (EEOC) issued proposed regulations that will require all employers with 100 or more employees to report salary information to the government beginning in 2017. The intent is to allow the EEOC to investigate discriminatory pay practices.
Form EEO-1 is an annual report that must be filed by all private employers with 100 or more employees and by federal contractors/subcontractors with 50 or more employees and contracts of at least $50,000.
The new EEOC regulations change the existing Form EEO-1 to require reporting of W-2 earnings and hours worked for all employees, broken down by race, ethnicity, gender and pay band.
Employers subject to EEO-1 reporting are already required to provide information on ethnicity, race and sex by job category. Starting in 2017, they will also have to provide the number of employees by ethnicity, race and sex that fall into certain established pay bands. Pay will be based on W-2 compensation for a 12-month look-back period between July 1 and September 30.
These new regulations have wide-spread implications for employers. In addition to additional data-gathering responsibilities, employers will now have to share salary information without being given the opportunity to explain any pay disparities. Employers should pay attention to this rule and may want to review salary data in advance of being required to report to the government.
