The Equal Employment Opportunity Commission (EEOC) has indicated that it plans to resume collecting pay data from employers that are subject to EEO-1 reporting requirements.
Pay data collection, also known as EEO-1 Component 2 reporting, was an Obama-era initiative that required private employers with 100 or more employees to submit aggregated information on employee compensation and hours worked, broken down by race, ethnicity, sex and job category. The EEOC’s goal in collecting pay data was to gain insight into pay disparities in the workforce in order to better target its enforcement efforts.
Pay data collection was scheduled to begin in March 2018, but in 2017, the Office of Management and Budget (OMB) blocked the collection before it began. After a series of legal developments, a federal judge ultimately ordered the EEOC to collect 2017 and 2018 pay data, which it did. However, in 2019, the EEOC voted to discontinue Component 2 collection in the future.
Speculation that the EEOC would revive pay data reporting has existed since President Biden took office in 2021. The latest Unified Agenda of Regulatory and Deregulatory Actions – a list of federal agencies’ upcoming rulemaking plans – confirms this conjecture. The EEOC announced in the Spring 2024 Unified Agenda, published earlier this month, that it plans to issue a proposed rule regarding pay data collection in January 2025.
However, the future of pay data collection at the federal level remains uncertain. Regulatory actions rarely meet projected timelines, and the outcome of the 2024 presidential election could lead the EEOC to change course yet again.
Pay data collection is already required for some employers under state laws in California and Illinois, and Massachusetts is considering a bill that would make it the third state to enact a similar law.
