Click “Subscribe Now” to get attorney insights on the latest developments in a range of services and industries.
For several years, the U.S. Equal Employment Opportunity Commission (EEOC) and others have raised concerns about unequal pay for women and minorities. These concerns led to the Lilly Ledbetter Fair Pay Act and are still being raised in current political campaigns.
The EEOC is now proposing to address the issue by revising the Employer Information Report (EEO 1) form to collect pay data from employers – including federal contractors – with more than 100 employees. The revision is designed to give the EEOC information about pay discrepancies across industries and occupations, and to strengthen federal efforts to combat discrimination.
This proposal is a significant change. EEO 1 data provides the federal government with workforce profiles from private sector employers by race, ethnicity, sex and job category. The new proposal would add aggregate data on pay ranges and hours worked beginning with the September 2017 report. Employers would be required to use W 2 wage data and report it by one of 12 pay bands for each EEO 1 job category. The proposed EEO 1 would report the number of employees whose total W 2 pay for the 12 months prior to the employer’s EEO 1 pay period fell into each band, and then categorize the information by race, ethnicity and gender. Individual wage information would not be reported. EEOC Chair Jenny Yang stated that the new information will allow the EEOC to “more effectively focus investigations, assess complaints of discrimination and identify existing pay disparities that may warrant further examination.” The EEOC would have the ability to initiate directed investigations focusing on equal pay without a discrimination charge. The proposed changes are available for inspection on the federal register website. Members of the public have until April 1, 2016 to submit comments.
A significant concern for employers is that the EEOC could initiate investigations without having complete information. The pay data would not distinguish among positions within the general job categories, nor would it include information that is typically used to determine compensation such as seniority, experience within a job classification, performance, education, or career experience. As a result, an employer could face significant expense responding to an EEOC investigation for which it has a valid explanation for any differences in pay.
Employers should now begin to analyze their pay data within job classifications to determine if there are discrepancies that need to be evaluated. The employer can then determine if there is a valid explanation for any discrepancies or make pay adjustments, if appropriate. Employers may want to discuss these issues with counsel in order to assess risk and to develop a strategy.
This client alert is published by Dickinson Wright PLLC to inform our clients and friends of important developments in the field of labor and employment law. The content is informational only and does not constitute legal or professional advice. We encourage you to consult a Dickinson Wright attorney if you have specific questions or concerns relating to any of the topics covered in here.
FOR MORE INFORMATION CONTACT:
Timothy H. Howlett is a member and labor & employment practice leader in Dickinson Wright’s Detroit office. He can be reached at 313.223.3662 or firstname.lastname@example.org.
Jeffrey M. Beemer is a member in Dickinson Wright’s Nashville office. He can be reached at 615.620.1719 or email@example.com.
For a printable version of this Labor and Employment client alert, click here.
- Webinars Can You Accommodate My Tattooed Ferret? Approaching Disability and Religious Accommodations in the Millennial Age Webinar on March 27, 2018
- Industry Alerts Department of Labor announces the final overtime rule. Is your business ready?
- Seminars Suzanne Sukkar and Christy McDonald to Speak at the ICLE Labor & Employment Law Institute
- May 11, 2022 Media Mentions Sara Jodka Quoted by 10 WBNS on Ohio's New Overtime Law
- May 09, 2022 Media Mentions Sara Jodka Quoted in Law360 on Tips for Helping Workers Navigate Mental Health Challenges
- February 2022 Blogs Practical Considerations in Employment Terminations
- January 14, 2022 Industry Alerts U.S. Supreme Court Splits the Baby as It Stays the Private Employer Vaccine or Test Mandate but Keeps the Healthcare Vaccine Mandate in Place
- December 20, 2021 Industry Alerts Private Employer Vaccine Mandate Moves Forward as Sixth Circuit Dissolves Fifth Circuit’s OSHA ETS Stay
- November 30, 2021 In the News Four Dickinson Wright Attorneys Recognized in 2021 Mid-South Super Lawyers