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Friday, September 1st, 2017
WAGES TAKE CENTER STAGE IN RECENT DEVELOPMENTS: EEO-1 Reporting and Overtime

This week brings some welcome news for employers.  

Earlier this week, the Office of Management and Budget stayed the 2016 EEOC rule requiring EEO-1 filers to include wage and hour data in their EEO-1 reports.  Under Title VII of the Civil Rights Act and Executive Order 11246, federal contractors with 50 or more employees (and a government contract exceeding $50,000) and private employers who are subject to Title VII and have at least 100 employees are required to file an annual EEO-1 report that counts every employee by race/ethnicity, sex, and one of ten job categories.  Last year, under the Obama Administration, the EEOC finalized a rule that required EEO-1 filers with 100 or more employees to also provide W-2 wage data and hours worked for every employee.  For the 2017 reporting year, the final rule extended the normal EEO-1 deadline of September 30, 2017 to March 31, 2018, to give filers ample time to collect the additional data.  This week, the OMB stayed the 2016 rule requiring employers to provide wage and hour data in their EEO-1 reports, citing concerns about employee privacy and confidentiality and the burden of the additional data collection on employers.  Covered employers still have to file EEO-1 reports containing the traditional demographic information (race/ethnicity and sex by job category) by the new March 31, 2018 deadline.  But for at least this reporting year, employers are off the hook for providing wage and hour data.  In response, the EEOC announced that the enforcement of equal pay laws remains a top priority for the agency and that it intends to develop an alternative proposal for pay data collection.  So, stayed tuned for more guidance from the Administration and EEOC and remain vigilant in evaluating your pay practices for unlawful disparities.

Also, yesterday, U.S. District Judge Amos Mazzant struck down the controversial amendment to the white collar overtime rule that would have doubled the salary threshold for the white collar exemption.  The Judge had previously granted a preliminary injunction to prevent the rule from going into effect, and that decision is still on appeal at the Fifth Circuit Court of Appeals.  His ruling yesterday was a final ruling invalidating the new salary threshold.  It remains to be seen what effect the ruling will have on the appeal, but it could likely make the appeal moot.  In the appeal, the Department of Labor recently stated that it would no longer advocate for the 2016 Obama Administration rule but that it intended to maintain its argument that the agency has the authority to issue salary thresholds for the white collar exemption.  In yesterday’s ruling, Judge Mazzant was careful to note that he was not ruling on the general lawfulness of the salary level test or the DOL’s authority to issue one.  Meanwhile, the DOL has issued a request for information to seek public comment on ways to revise the Obama Administration’s rule.  Given those developments, it seems unlikely that the Trump Administration’s DOL will appeal yesterday’s ruling or pursue the pending appeal.  But, we should all stay tuned to see how it plays out in the courts and at the agency rulemaking level.

If you have any questions or would like additional information, please reach out to your contacts in the Firm’s Labor & Employment Practice.

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