US: Proposed new obligation for large US employers to report pay information

A rule recently proposed by the US Equal Employment Opportunity Commission seeks to expand the scope of information that US employers with over 100 employees ("Qualified Employers") must currently report to the federal government. Specifically, in addition to reporting the race, gender, and ethnicity of their employees, the proposed rule would also require Qualified Employers to report pay data. The EEOC and other federal agencies will use the data to assess complaints of discrimination and to proactively identify employers with pay disparities for potential investigation.

The proposed rule, which would come into effect in 2017, would supplement the current EEOC rule requiring Qualified Employers to submit an annual report regarding their employees' ethnicity, race, and gender. Under the proposed rule, Qualified Employers would also be required to report the number of employees in each ethnic, racial, and gender category who fall into certain salary bands, as well as the number of hours worked by employees in each of those categories. The EEOC expects that Qualified Employers will be able to extrapolate the new categories of data from W-2 tax forms.

In addition to using the pay data to uncover potentially discriminatory employment practices, the EEOC may also publish the data on an aggregated basis as part of its regular reporting of employment statistics.

Employers who are not subject to Title VII of the Civil Rights Act of 1964 will not be subject to the proposed rule.

The EEOC has specifically requested public comment on the utility and burden of collecting pay and hours-worked data as contemplated by the proposed rule. Employers may provide comments until 1 April 2016. If the proposed rule is enacted, the first filing date that would be affected would fall in September 2017.

The EEOC's proposed rule can be found here. Comments on the proposed rule can be submitted here until 1 April 2016.