As we previously reported , EEOC has filed notice asking for renewed approval to collect EEO-1 Component 1 race, gender and ethnicity workforce data for the next three years (2019, 2020 & 2021), but is not seeking renewed authority to collect Component 2 pay data and hours worked. To be clear, this filing does not impact the current obligation employers have to submit 2017 and 2018 pay data by September 30, 2019.

EEOC’s authorization to collect any EEO-1 data (Component 1 or Component 2) expires on September 30, 2019.  Thus, the Agency has submitted the current information request because it needs approval to continue to collect Component 1 data.  Confusingly, Judge Chutkan ordered in National Women’s Law Center, et al. v. Office of Management and Budget, et al., that EEOC’s authority to collect Component 2 pay data will expire no later than April 5, 2021.  This Order, however, is currently at the center of a legal appeal.  But for the court’s order, or in the event the court’s order is overturned on appeal, EEOC’s authority to collect Component 2 data will likewise expire on September 30, 2019.

As a result of the two expiration dates, and the pending litigation, EEOC is asking the Office of Management and Budget (OMB) to separate approval of Component 1 data collection from Component 2 collection so it can continue to collect Component 1 data while it takes time to assess the utility and burden associated with the Component 2 collection.

According to its notice, EEOC has serious doubts about the previously reported burden on employers to collect and file Component 2 data.  It seems EEOC has discovered the previous burden estimate was

an extremely low estimate of the burden on employers. . . EEOC now concludes the burden estimate associated with the EEO-1 is higher than it has previously estimated.

Because it is concerned the actual burden may outweigh the value of the data, the Agency has elected to pause so it can “balance the utility of the data to its enforcement programs against the burden the data collection as structured imposes on the employers who must submit it.”

Therefore,

[t]he Commission now concludes that it should consider information from the ongoing Component 2 data collection before deciding whether to submit a pay data collection to OMB. At this point in time, the unproven utility to its enforcement program of the pay data as defined in the 2016 Component 2 is far outweighed by the burden imposed on employers that must comply with the reporting obligation. Therefore, the EEOC is not seeking to renew Component 2 of the EEO-1.

This admission does not, however, mean EEOC has necessarily made any decision regarding whether it will collect some form of Component 2 data going forward.  However, it appears EEOC will not seek approval to collect any additional Component 2 pay data in the near future, either pursuant to its existing authority or pursuant to approval following a new request for OMB approval.  Rather, EEOC’s notice suggests it will take a step back, analyze the 2017 and 2018 to determine if and how it might efficiently collect valuable employer pay data without unduly burdening employers, and then move forward from there.  How long it may take EEOC to sort this all out is, at this point, anyone’s guess.

Please check back for updates as the saga of EEO-1 Component 2 reporting continues at EEOC, OMB and the courts.

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Photo of Laura A. Mitchell Laura A. Mitchell

As co-leader of the firm’s ESG group, Laura Mitchell partners with her clients to evaluate, set, achieve and monitor their organizational culture and human capital goals. She focuses her practice on data analytics, including pay equity and other employee analytics, working side-by-side with…

As co-leader of the firm’s ESG group, Laura Mitchell partners with her clients to evaluate, set, achieve and monitor their organizational culture and human capital goals. She focuses her practice on data analytics, including pay equity and other employee analytics, working side-by-side with employers to build programs that benefit employees and create a stable, high-functioning workplace. Understanding that an inclusive, values-based culture provides a crucial competitive advantage in the modern workplace, Laura enjoys counseling companies on the development of proactive and equitable pay and diversity practices.

In Laura’s version of the reimagined workplace, attention to human capital issues, especially DEI and pay equity, would be the rule rather than the exception nationwide and she works with companies across all industries—both new and well-established multi-national organizations of all sizes—to realize this vision for her clients’ ongoing success. She helps clients understand all issues across the spectrum of their journey, helping to establish regular analyses as well as counseling organizations on implementation and compliance obligations, where applicable. Committed to putting her clients’ organizational goals first and foremost, Laura views herself as an extension of her clients’ team, responsible for providing proactive guidance and engaging in transparent, ongoing communication.

Laura also represents companies in OFCCP matters, preparing for and defending OFCCP audits, and counseling employers on issues stemming from OFCCP regulations. She personally oversees the development of hundreds of Affirmative Action Plans for clients each year and is intimately involved in the defense of OFCCP audits. Her approach to compliance is one of facilitation and conciliation while simultaneously advocating in the best interests of her clients.