Business and Legal Insights

On August 29, 2017, the Equal Employment Opportunity Commission (EEOC) announced that the Office of Management and Budget (OMB) was “initiating a review and immediate stay of the effectiveness of the new aspects of the EEO-1” form. This news comes as a relief to employers and business owners who now no longer have to worry about practical challenges presented by the revised EEO-1 form’s pay reporting requirements.

In essence, the new form would have required employers with 100 or more employees to report summary pay data, specifically what it pays its employees categorized by gender, ethnicity and race as part of the annual Employer Information Report or EEO-1. The OMB cited, among other things, the burdens that the new form would place on employers and the questionable efficacy of the new data provided as justification for the stay. The previous version of the EEO-1 form—which allows the EEOC to collect data on race, ethnicity, and gender—remains in effect throughout the review process.

For now, OMB’s stay provides a reprieve for employers on the new pay reporting requirements, but it is important to note that the move does not kill the requirements in their entirety or prevent the EEOC from requiring such information in the future. As the EEOC’s acting chair Victoria A. Lipnic commented, “[t]he EEOC remains committed to strong enforcement of our federal equal pay laws . . . Today’s decision will not alter EEOC’s enforcement efforts.” Accordingly, employers should continue to take issues of pay equity seriously as they compose a variety of risks. Employers can protect themselves from these risks by engaging in self-assessments to ensure that their payroll practices are in compliance with federal, state, and local requirements. The EEOC’s formal announcement regarding the stay can be found here.