Recently, we wrote about the new "Component 2" section of a revised EEO-1 form that was
reinstated on March 4, 2019 as a result of a recent court ruling. Component 2 now requires employers to provide a report to the EEOC on the annual wages earned and hours worked by employees of each gender, race and ethnic background.
In an April 25 ruling, the federal judge overseeing the matter set a September 30, 2019 deadline for submission of the data. Then, on May 3, EEOC provided several updates on its website regarding Component 2 and important dates relevant to EEO-1 filing. Here is the timetable EEOC has set:
- May 31st: Traditional EEO-1 data is due for the fiscal year 2017 and 2018.
- September 31st: Component 2 data is due.
Although some questions remain as to whether the EEOC will remove or alter the existing May 31 Component 1 deadline to avoid two separate filings, the deadline to submit Component 1 data officially remains May 31, 2019.
The court fight over the Component 2 pay data is not over. On May 3, the Department of Justice appealed the rulings that reinstated the Component 2 requirement and set deadlines for the submission of the required information. However, that appeal has no effect on reporting obligations, and employers should still prepare to submit their 2017 and 2018 EEO-1 Component 1 data by the May 31 deadline.
It is important to begin preparing for the Component 2 filing requirements given that the compilation of this information is much more complex, time-consuming, and burdensome than that of Component 1. The Component 2 filing requires 25 times the number of data fields of Component 1. As we previously reported, employers will need to develop a feasible system to integrate their payroll databases with HR databases containing the required demographic data. Since many businesses use different systems to maintain payroll and demographic information, employers should consider hiring a third party or outside vendor to assist with the integration.
We will continue to monitor the situation and provide updates as they become available. In the meantime, if you have any questions regarding pay data requirements, please reach out to your contact at the firm.
Sincerely,
Sahar Shiralian
Richard S. Rosenberg
Ballard Rosenberg Golper & Savitt, LLP
