The new EEO requirement reporting, recently announced, can be challenging. Kathleen Huggins, Mercer PeoplePro Talent Management specialist, identifies the changes, challenges and offers steps needed for early preparation.
Who Needs to Comply?
Any employer who has at least 100 employees is required to file the annual EEO-1 report. Employers who are government contractors must file the report if they have at least 50 employees and $50,000 in Federal contracts.
For data covering years through 2016, the filing deadline for the report was September 30, based on data from one pay period falling between July 1 and September 30. The report requires that the data be categorized based on race/ethnicity, gender and EEO job category.
What’s Changing in 2017?
The data collection currently required will continue to be reported, but two significant data points are being added to the reporting requirement.
- For each of the 10 EEO categories reported, pay data must be reported using the 12 pay bands designated by the Bureau of Labor Statistics; and
- Hours worked for each employee must also be reported by EEO category and pay band.
Employers will pull W-2 wages in order to determine the pay band into which each individual falls; however, there is no requirement to report individual salaries. To determine hours worked, for non-exempt employees for whom hours are tracked for pay purposes, those records will be used to report hours on the EEO-1 report. For exempt employees, employers may either use 40 hours per week for fulltime employees and 20 hours for part-time employees; or, alternatively, they may track and report actual hours worked.
The pay gap between protected classes and non-protected classes persists despite regulation designed to prevent discriminatory practices. The purpose of this change is to make it easier to investigate instances of potential pay discrimination.
Filing Deadline
The 2017 report must be filed no later than March 31, 2018. Important note: Everyone who worked in 2017 must be included in the report, even if they are no longer working on December 31, 2017.
Begin Preparation Early
Don’t delay preparing for this new EEO requirement. There are a number of decisions to be made and steps the employer must take. If the employer chooses to report actual hours worked for exempt employees, a measurement system must be available to capture those hours. HRIS data must be reviewed to ensure that all data is accurate and reports need to be set up to pull the new data.
Take the opportunity to review pay levels to determine which pay band into which each individual falls and assess whether there is any non-justifiable pay difference between protected classes and non-protected classes.
Mercer PeoplePro can Help
If you feel you could use some help navigating this new EEO requirement, Mercer PeoplePro can help. Schedule an appointment today and enjoy a free consultation, plus 2 free hours towards your first project. To set up your free consultation, visit MercerPeoplePro — we’re standing by and ready to assist.
Written by Mercer PeoplePro Talent Management specialist, Kathleen Huggins
