The Equal Employment Opportunity Commission (EEOC) announced on July 13, 2016 that a revised proposal to collect pay data through the Employer Information Report (EEO-1) has been published. This revised proposal can be viewed on the Federal Register website: https://www.federalregister.gov/articles/2016/07/14/2016-16692/agency-information-collection-activities-notice-of-submission-for-omb-review-final-comment-request.

 

The newest revisions take into consideration public comments that were received by the department after the initial proposal to revise the EEO-1 report was published in early 2016; the EEOC has adopted some specific suggestions from those commenter’s in order to simplify the proposed pay data collection reporting for employers.

 

Background:

 

On January 29, 2016, the Equal Employment Opportunity Commission (EEOC) announced plans to revise the annual EEO-1 report; which will include pay data by gender, race and ethnicity. The proposed changes will require employers with 100 or more employees, including federal contractors and non-contractors to collect and report pay data annually.

 

The EEOC and the Office of Federal Contract Compliance Programs (OFCCP) at the DOL are working jointly to improve enforcement and compliance with federal pay discrimination laws. The EEOC proposal is an expansion and replacement of a prior proposal under Executive Order 11246 to collect similar pay data from federal contractors.

 

Summary of July 2016 Proposed Revisions:

 

The July notice published in the Federal Register contains a few relevant changes and clarifications from the initial proposal, some of which are listed below:

 

1. The 2016 EEO-1 reporting deadline will remain September 30, 2016 and will use the current unchanged EEO-1 reporting form.

 

2. The reporting deadline for all EEO-1 filers will change to March 31st of the year that follows the EEO-1 report year (currently September 30th). This is a change to calendar year reporting and would push the 2017 EEO-1 form due date to March 31, 2018 and the W-2 wage based data from the previous year would be reported. This translates to an 18 month “break” for EEO-1 filers after submitting the 2016 EEO-1 form. This is the most significant change as it will allow employers to use actual W-2 data from the tax year.

 

3. Clarifies employers must provide Box 1 W-2 earnings received between January 1 and December 31 of the relevant calendar year.

 

4. Does not change initial proposal regarding the requirement of reporting hours worked for exempt employees; but the new revision to the proposed rule offers two options for counting exempt employee hours:

 

a. Report a proxy of 40 hours per week for FT exempt employees and 20 hours per week for PT exempt employees; multiplied by number of weeks the employee was employed during the EEO-1 reporting year, Or:

 

b. Report actual hours worked by exempt employees during the EEO-1 reporting year, if the employer currently maintains accurate records of actual hours worked.

 

Employers who would be required to report this new data should become familiar will the revisions now; to view a sample of the proposed EEO-1 form, visit: http://www.eeoc.gov/employers/eeo1survey/2016_new_survey.cfm.

 

The EEOC has a web page to provide links to the fact sheet, Q&A and the revised proposed report, which can be viewed here: https://www.eeoc.gov/employers/eeo1survey/2016_eeo-1_proposed_changes_revised.cfm.

 

The direct link to the revised proposed EEO-1 reporting form is: https://www.eeoc.gov/employers/eeo1survey/upload/proposed_survey_revised_1.pdf. Links in prior alerts should be disregarded.

 

Paylocity will continue to monitor the EEOC rules and will provide an alert when final regulations are provided.

 

Thank you for choosing Paylocity as your Payroll Tax partner. Should you have any questions please contact your Paylocity Account Manager.

 

This information is provided as a courtesy, may change and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney or Advisor.