Many employers will be required to report information on pay and hours worked for all of their employees under changes proposed by the U.S. Equal Employment Opportunity Commission (EEOC) to existing reporting requirements. In proposed regulations published on February 1, 2016, the EEOC announced that beginning in 2017 it will require employers with 100 or more employees to annually submit pay data to allow the agency to identify pay discrimination issues and promote equal pay.

The EEOC would modify the existing Employer Information Report (EEO-1) to include W-2 earnings and hours worked for all employees. This data will be broken out by EEO-1 category (race/ethnicity, gender) and by “pay band” so that the EEOC may use the data to determine whether equal pay issues exist that would warrant additional enforcement action. The revisions were announced in conjunction with the seventh anniversary of the Lilly Ledbetter Fair Pay Act and were published for comment on February 1, 2016. The public comment period will run through April 1, 2016. 

In addition to the potential burden on employers to gather this data, these proposed regulations pose a concern because the EEOC would receive wage information for the purpose of bringing enforcement actions against employers, but the information that the EEOC receives will not provide the EEOC with any context to explain potential pay disparities. To prepare for the potential increase in litigation, employers should take this opportunity to review their pay practices, in conjunction with counsel, to determine if there are pay disparities to be addressed.    

Ballard Spahr’s Labor and Employment Group routinely assists employers with Office of Federal Contract Compliance Programs (OFCCP) audits and compensation manager interviews.

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