While most of us are focused on Tax Day as the next major federal filing deadline, large employers and federal contractors should not lose sight of March 31 – the deadline for filing EEO-1 reports. For those who are unfamiliar, the EEO-1 report is a compliance survey mandated by the Equal Employment Opportunity Commission (EEOC) under its regulations implementing Title VII of the Civil Rights Act. Through this report, the EEOC collects data on the race, ethnicity, and sex of private-sector employees, which is subdivided by job category. The EEOC will use this data to analyze job patterns of women and minorities in private industry in order to guide enforcement efforts. To this end, the information included in an employer’s EEO-1 report may be used in litigation against that employer.
Who must file the EEO-1?
The EEO-1 report must be filed by all private employers which are subject to Title VII and which employ 100 or more employees. When counting employees, the EEO-1 requires employers to count both the employees that they directly employ and the employees employed by any other entity with which the employer is affiliated through interrelated operations or by common control, management, or ownership. Federal contractors, too, are required to file EEO-1 reports if they hold a prime contract or a first-tier subcontract for $50,000 or more and employ at least 50 employees. This is often a requirement of the federal contracts or bids themselves, in addition to the EEOC’s regulations.
Collecting and reporting employee data
To collect the data required by the EEO-1 report, employers must select a “workforce snapshot period.” This can be any pay period between October 1 and December 31 for the reporting year. The employer must then report the demographic and job data on all W-2 employees during the selected pay period.
To help employers collect demographic data, the EEOC offers voluntary employee self-identification forms. Employers can request, but not require, employees to complete one of these forms. If an employee chooses to complete the form, the employer should keep the form separate from the employee’s personnel file. If an employee refuses to self-identify, the employer must still include the refusing employee on its EEO-1 report and should identify the refusing employee’s race, ethnicity, and sex based on the employer’s observation.
After collecting the responsive data, employers must file their EEO-1s using the EEOC’s online portal at: egov.eeoc.gov/EEO-1/login.jsp. Exceptions to the online filing requirement are rare and will only be made for employers which do not have internet access (likely excluding anyone reading this).
After completing the EEO-1 report, private employers must retain a copy of the report for one year. Federal contractors must retain EEO-1 reports for 3 years.
Penalties for noncompliance
The EEOC may seek a court order requiring noncompliant employers to file an EEO-1 report. While potentially expensive to litigate, there are no civil penalties or fees for a failure to file an EEO-1 report for most employers. Federal contractors should be careful though.
The Office of Federal Contract Compliance Programs (OFCCP) may cancel, terminate, or suspend all or a portion of any federal contract held by a noncompliant employer. Noncompliant federal contractors may also be subject to permanent debarment or debarment for a specified period of time.
The penalties against employers which file willfully false EEO-1 reports are much more significant and are punishable by fines or imprisonment.
Although the EEO-1 may be a cumbersome report for many employers to complete, it is not as comprehensive as initially anticipated. Last year, the 2017 EEO-1 reporting requirements were revised to include a second component (imaginatively called “Component 2”). Component 2 required employers to aggregate and report each employee’s income and hours worked for the year ending December 31, 2017. The Office of Management and Budget, however, has officially stayed the enforcement of these requirements while it reviews the Component 2 requirement for compliance with the federal Paperwork Reduction Act. Because of this stay, employers are not required to report pay and hour data on their upcoming EEO-1 reports.
Employers with questions regarding their EEO-1 reporting obligations should contact Nemeth Law, P.C.