Implementation of the New EEO-1 Report is Still Uncertain

In a few weeks, the 2nd quarter of calendar year 2017 will roll in. With the fate of the new EEO-1 Report still uncertain, most contractors are, understandably, getting anxious. Will the EEOC implement the changes or will it table the implementation until further review? Should contractors prepare for the September 30, 2017 filing or will they have more time to prepare for the first deadline of March 31, 2018?

Two weeks after being named as the acting chair of the EEOC, Victoria Lipnic, in her first public comment in February, addressed the requirements for filing the EEO-1 reports under the new regulations. She expressed that there is a need to re-evaluate the costs and benefits of the revised EEO-1 reporting – something that falls directly under the mandate of the Trump administration for all agencies to “rethink the regulations they have on the books.” Although Ms. Lipnic was vocal about her dissenting vote on the modifications, she was also quick to point out that the commission operates by vote, and, therefore, the agency’s current position cannot be altered by only one commissioner.

In addition to filing gender and race data, the new EEO-1 Form requires all employers (private and federal) with 100 or more employees to report summary pay data by gender/race. Employers will be required to indicate the total number of full/part time employees and total hours worked within 12 pay categories for each of the 10 EEO job classifications. Data collected through the EEO-1 report is accessed by the OFCCP for the purposes of establishing their audit list, however, summary pay data for federal contractors and subcontractors will be routed directly to the OFCCP. The EEOC and the OFCCP, in their respective capacities and responsibilities, see the inclusion of pay in the EEO-1 report as an integral tool for more effective and efficient investigations of pay discrimination. The federal contracting community-at-large applauds the efforts but questions the usefulness of 12×10 aggregated pay data for investigation of pay discrimination.

‘Retool and prepare now or wait and see?’, that is the question. Many federal contractors are holding out hope that the Trump administration will eliminate pay data requirements and revert back to the previous EEO-1 reporting requirements.  Many contractors aren’t waiting and, in anticipation of the change, have developed a game plan and/or methodology for structuring their data for submittal. For those who are still holding out hope, it is recommended that you be proactive and at least consider creating a test file to assess your gaps in data.

Steps to creating a test file:

  1. Export from your payroll software or connect with your payroll service provider, payroll or compensation department to retain a list of employees (with employee ID’s), their associated W-2 (Box 1) pay and hours worked for the 2016 calendar year.
  2. Export from your HRIS the requisite demographic data for all employees (as required).
  3. Create a single data file by merging payroll with HRIS employee data files.
  4. Sort pay in ascending order, create a new column and then create and label each employee in accordance with their corresponding EEO-1 report compensation band.
  5. Verify that your data aligns with the EEO-1 report format through Pivot Tables.

Additional factors to consider when compiling total number of hours worked:

  1. How is the organization capturing the actual hours worked for exempt employees
  2. How the reported total hours will affect compensation analysis (i.e., hours worked of part time employees and exempt employees).

Still feeling lost?  Check out the EEOC website, recent EEOC webinar, or contact a Biddle EEO/AA Specialist at staff@biddle.com.

Independent of the changes to the EEO-1 form and requirement of submitting summary pay data, best practices, laws and regulations dictate that contractors should review their compensation system and analyze their data to ensure equal pay and eliminate disparities.


Article co-authored by John Piatt, Director of EEO/AA Client Support & CERT, Biddle Consulting Group, Inc.

Fostering Pay Transparency In Your Organization

In case you missed it, as a Federal Contractor, you and your company are obligated to foster pay transparency by letting  your employees know their rights under the Pay Transparency Nondiscrimination Provision.   At a minimum you are required to include the provision in employee manuals and handbooks as well as post with other employee rights information.  The following is copied directly from the Department of Labor’s website and provides guidance to your obligations.

Office of Federal Contract Compliance Programs (OFCCP) 

Pay Transparency Nondiscrimination Provision

Every employer covered by Executive Order 11246, as amended, is required to post the Pay Transparency Nondiscrimination Provision and include it in employee manuals and handbooks. The provision provides applicants and employees notice that the employer will not discriminate against them for inquiring about, discussing or disclosing their pay or, in certain circumstances, the pay of their co-workers.

Because OFCCP believes that uniform use of the nondiscrimination provision is necessary to ensure consistency and clarity in the information provided to applicants and employees, contractors must, at a minimum, use the language provided in the nondiscrimination provision provided below to satisfy both dissemination requirements. Of course, nothing limits a contractor from providing additional information to their employees about their rights and obligations.

Posting Requirement

The posting requirement may be accomplished by posting the provision electronically or by posting a copy of the provision in conspicuous places available for employees and applicants. In order to facilitate the implementation of this requirement, OFCCP has created two versions of the nondiscrimination provision.

The first version is formatted to be posted electronically or printed and posted on the employer’s premises. It includes the OFCCP logo and contact information.

The second version includes the required, prescribed language only without formatting. At a minimum, contractors must use this prescribed language.

Employee Manuals and Handbooks

In addition to the posting requirement, employers covered by Executive Order 11246 must incorporate the nondiscrimination provision into their existing manuals or handbooks. Again, employers must, at a minimum, use the unformatted version.

Please note that this page provides general information. It is not intended to substitute for the actual law and regulations regarding the program described herein.

Note from Biddle:  Ensuring pay equity is a social and legal concern.  If you have potential concerns about pay equity in your organization or would like to know more about conducting a pay equity study, please feel free to give our experts a call or join us at the BCGi Summit where we will be diving into the intricacies of compensation (pay equity) analysis.

EEOC Announces Second Opportunity for Public Comment on Proposal to Collect Pay Data

As you may know, the Equal Employment Opportunity  Commission recently proposed to change the EEO-1 reports to include pay data. On July 14, 2016, after hearing over 300 public comments, the EEOC revised the proposal to incorporate feedback on how and when the pay data will be collected. Specifically, the EEOC adopted the suggestion of changing the due date from September 30, 2017 to March 31, 2018 to allow employers to utilize existing W-2 reports, as well as provide more time for employers and HRIS vendors to update their recordkeeping. The EEOC also addressed a few comments in their question and answer section, mainly regarding the decision to proceed with W-2 earnings as the form of pay data collected.

The revised proposal is currently in the public comment period. Employers may submit comments until August 15, 2016.

Do you feel the pay data being collected accurately reflects the way your organization is structured?
Does the change in when you file your EEO-1 report benefit you?
Let the EEOC know!
To submit your comment, please follow this link: https://federalregister.gov/a/2016-16692

To review the questions and answers, please follow this link: https://www.eeoc.gov/employers/eeo1survey/2016_eeo-1_proposed_changes_qa_revised.cfm

‘Tis the Season: Filing EEO-1 and VETS-4212 Reports

The season for filing EEO-1 and VETS-4212 reports is upon us. The filing year for EEO-1 reporting opened July 1, and the electronic filing system is expected to open this month. The filing year for VETS-4212 reporting begins August 1, and the electronic filing system is expected to open in early August.

In addition, it is important to remember that the Veterans’ Employment and Training Service (VETS) recently announced that the threshold requiring federal contractors to file VETS-4212 reports has been increased from $100,000 to $150,000, and the change will be in effect for the 2016 filing year. As such, if your organization does not meet the contract threshold, then you are not required to file VETS-4212 reports.

Additional reminders:

  • EEO-1: Employment data must be pulled from any pay period between July 1 to September 30, 2016.
  • VETS-4212: Employment data must be pulled from any pay period between July 1 to August 31, 2016. New Hire data must be pulled for the 12-month period preceding the ending date of the selected payroll period.

Biddle Consulting Group is here to help. If you are interested in learning more, or need assistance filing EEO-1 and VETS-4212 reports, please send an email to staff@biddle.com or call (800) 999-0438.

In addition, on July 14, 2016, Biddle offered a free webinar to review the EEO-1 reporting requirements. The fully-recorded webinar will be available for download soon. BCGi Platinum members may download the webinar with their annual subscription ($299).