The Equal Employment Opportunities Commission (EEOC) recently established new requirements that employers, including federal contractors, report pay data to the EEOC. Employers with at least 100 employees will be required to submit summary information pertaining to gender, race, and ethnicity as a way to improve investigations of possible pay discriminations.
The five member committee voted narrowly 3-2 to approve the new pay data reporting. As you can imagine there is opposition to the matter. Advocates look forward to transparency as a way to discern patterns of discrimination by employers. But those against the new requirements say that it is onerous to employers. Now two Republican senators, Laram Alexander of Tennessee and Patrick Roberts of Kansas, are calling for the rule’s repeal.
The Office of Management and Budget (OMB) approved the new requirement while retaining the authority to rescind or stay the rule through the federal Paperwork Reduction Act. The Act gives this authority to the OMB if the OMB decides that the circumstances have changed or that the burden was materially in error. So how big is the burden then? The Senator’s letter to the OMB said the EEOC reported that about 61,000 U.S. employers would be required to submit a total of 180 pieces of information each year “—in no way ‘minimiz[ing] paperwork and reporting burdens on the American public.’”
The Chamber of Commerce has also issued a letter opposing the requirement saying the EEOC’s numbers greatly underestimate the amount of time and money employers will need to spend in order to comply. The Chamber states that the results of its survey indicate that the EEOC underestimated the number by about four times the number of hours and amount of money actually needed to comply with the requirement.
The EEOC’s rule is scheduled to take effect in March of 2018. Depending on the availability of the data by the employers and other potentially burdening statistics, the OMB could take a second look at it in the meantime. The EEOC postponed implementation until 2018 to allow employers adequate time to prepare for this reporting requirement. Stay tuned to the Workplace Report for updates on your employer obligations under this new requirement.