Agency Information Collection Activities: Revision of the Employer Information Report (EEO-1) and Comment Request, 5113-5121 [2016-01544]


[Federal Register Volume 81, Number 20 (Monday, February 1, 2016)]
[Pages 5113-5121]
From the Federal Register Online via the Government Publishing Office []
[FR Doc No: 2016-01544]




Agency Information Collection Activities: Revision of the 
Employer Information Report (EEO-1) and Comment Request

AGENCY: Equal Employment Opportunity Commission.

ACTION: Proposed revision of the employer information report (EEO-1) 
and comment request.


SUMMARY: In accordance with the Paperwork Reduction Act (PRA), the 
Equal Employment Opportunity Commission (EEOC or Commission) announces 
that it intends to submit to the Office of Management and Budget (OMB) 
a request for a three-year PRA approval of a revised Employer 
Information Report (EEO-1) data collection. This revised data 
collection has two components. Component 1 collects the same data that 
is gathered by the currently approved EEO-1: Specifically, data about 
employees' ethnicity, race, and sex, by job category. Component 2 
collects data on employees' W-2 earnings and hours worked, which EEO-1 
filers already maintain in the ordinary course of business. For the 
2016 reporting cycle, all EEO-1 filers would submit the data under 
Component 1. Starting in 2017, filers with 100 or more employees (both 
private industry and Federal contractor) would submit data in response 
to both Components 1 and 2. Contractors with 50 to 99 employees would 
only submit data for Component 1. In this notice, the EEOC solicits 
public comment on the utility and burden of collecting pay and hours-
worked data through the EEO-1 data collection process.

DATES: Written comments on this notice must be submitted on or before 
April 1, 2016.
    Pursuant to 42 U.S.C. 2000e-8(c), a public hearing concerning the 
proposed changes to the EEO-1 will be held at a place and time to be 
announced. To request an opportunity to present your views orally at 
the hearing, please submit a written request to the EEOC's Executive 
Secretariat (street address below) no later than February 22, 2016 to 
be assured of consideration. Please include your contact information.

ADDRESSES: Comments on this notice may be submitted to the EEOC in 
three ways; please use only one.
    Comments and attachments may be submitted online at, which is the Federal eRulemaking Portal. Follow 
the instructions on the Web site for submitting comments. Comments 
received here will be posted publicly on the same portal without 
change, including any personal information you provide. However, the 
EEOC reserves the right to refrain from posting comments, including 
those that contain obscene, indecent, or profane language; that contain 
threats or defamatory statements; that contain hate speech directed at 
race, color, sex, sexual orientation, national origin, ethnicity, age, 
religion, or disability; or that promote or endorse services or 
    Hard copy comments and all requests to participate in the hearing 
may be submitted to Bernadette Wilson, Acting Executive Officer, 
Executive Secretariat, Equal Employment Opportunity Commission, 131 M 
Street NE., Washington, DC 20507.
    The Executive Secretariat also will accept documents totaling six 
or fewer pages by facsimile (``fax'') machine. This limitation is 
necessary to assure access to the equipment. The telephone number of 
the fax receiver is (202) 663-4114. (This is not a toll-free number.) 
Receipt of fax transmittals will not be acknowledged, except that the 
sender may request confirmation of receipt by calling the Executive 
Secretariat staff at (202) 663-4070 (voice) or (202) 663-4074 (TTY). 
(These are not toll-free telephone numbers.)
    Subject to the conditions noted above, the EEOC will post online at all comments submitted in hard copy or by 
fax with the Executive Secretariat. The EEOC Headquarters' library also 
will make available hard copies of all comments, by advance appointment 
only, between the hours of 9 a.m. and 5 p.m. Eastern Time. To schedule 
an appointment to inspect the comments at the EEOC's library, contact 
the library staff at (202) 663-4630 (voice) or (202) 663-4641 (TTY). 
(These are not toll-free numbers.)
    For reference when commenting on this notice, the current EEO-1 
(and proposed Component 1) can be found at An illustration of the data to 
be collected by both Components 1 and 2 can be found at

FOR FURTHER INFORMATION CONTACT: Ronald Edwards, Director, Program 
Research and Surveys Division, Equal Employment Opportunity Commission, 
131 M Street NE., Room 4SW30F, Washington, DC 20507; (202) 663-4949 
(voice) or (202) 663-7063 (TTY). Requests for this notice in an 
alternative format should be made to the Office of Communications and 
Legislative Affairs at (202) 663-4191 (voice) or (202) 663-4494 (TTY).


The EEO-1 Survey and Its Legal Authority

    Section 709(c) of Title VII of the Civil Rights Act of 1964 (Title 
VII) requires employers to make and keep records relevant to the 
determination of whether unlawful employment practices have been or are 
being committed, to preserve such records, and to produce reports as 
the Commission prescribes by regulation or order.\1\ Pursuant to this 
statutory authority, the EEOC in 1966 issued a regulation requiring 
certain employers to file executed copies of the EEO-1 survey in 
conformity with the directions and instructions on the form, which 
called for reporting employee data by job category, ethnicity, race, 
and sex.\2\ Pursuant to Executive Order 11246,\3\ the Office of Federal 
Contract Compliance Programs (OFCCP), U.S. Department of Labor (DOL), 
in 1978 issued its regulation describing the EEO-1 as a report 
``promulgated jointly with the Equal Employment Opportunity 
Commission'' and requiring certain contractors to submit ``complete and 
accurate reports'' annually.\4\ Through the EEO-1 Joint Reporting 
Committee housed at the

[[Page 5114]]

EEOC, the EEO-1 is administered as a single data collection to meet the 
statistical needs of both agencies.\5\ Currently, the EEO-1 directs 
certain covered employers with more than 50 employees (contractors) or 
100 employees (private industry) \6\ to report annually the number of 
individuals they employ by job category and by race, ethnicity, and 
sex.\7\ The data include seven race and ethnicity categories \8\ and 
ten job categories,\9\ by sex. A sample copy of the currently approved 
EEO-1 can be found at

    \1\ 42 U.S.C. 2000e-8(c).
    \2\ The EEOC's EEO-1 regulation is at 29 part 1602 Subpart B. 
The EEOC is responsible for obtaining OMB's PRA approval for the 
EEO-1 report.
    \3\ Exec. Order No. 11,246, 30 FR 12,319 (Sept. 24, 1965).
    \4\ 41 CFR 60-1.7(a).
    \5\ The EEOC shares EEO-1 data with state and local Fair 
Employment Practices Agencies under the authority of section 709(d) 
of Title VII. Subject to their agreement to comply with the 
confidentiality provisions of 42 U.S.C. 2000e-8(e), the EEOC shares 
EEO-1 reports with the Department of Justice (DOJ), the Federal 
Deposit Insurance Corporation (FDIC), and the National Credit Union 
Administration (NCUA). The FDIC and the NCUA use EEO-1 data pursuant 
to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 
2010 to help analyze diversity in management, employment, and 
business activities. DOJ uses the EEO-1 data when it defends OFCCP 
in litigation, in the event a federal contractor sues OFCCP to 
prevent debarment.
    \6\ Unless otherwise noted, the term ``contractor'' refers to 
federal contractors and first-tier subcontractors that satisfy the 
employee and contract size coverage criteria that subject them to 
the EEO-1 reporting obligations. The term ``private industry'' 
refers to all other entities required to file the EEO-1 that are not 
included in the ``contractor'' designation. The term ``employer'' or 
``filer'' refers collectively to all entities that file EEO-1 data.
    \7\ The EEO-1 uses federal race and ethnic categories, which 
were adopted by the Commission in 2005 and implemented in 2007, 
pursuant to the PRA.
    \8\ Hispanic or Latino--A person of Cuban, Mexican, Puerto 
Rican, South or Central American, or other Spanish culture or origin 
regardless of race.
    White (Not Hispanic or Latino)--A person having origins in any 
of the original peoples of Europe, the Middle East, or North Africa.
    Black or African American (Not Hispanic or Latino)--A person 
having origins in any of the black racial groups of Africa.
    Native Hawaiian or Other Pacific Islander (Not Hispanic or 
Latino)--A person having origins in any of the peoples of Hawaii, 
Guam, Samoa, or other Pacific Islands.
    Asian (Not Hispanic or Latino)--A person having origins in any 
of the original peoples of the Far East, Southeast Asia, or the 
Indian Subcontinent, including, for example, Cambodia, China, India, 
Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand, 
and Vietnam.
    American Indian or Alaska Native (Not Hispanic or Latino)--A 
person having origins in any of the original peoples of North and 
South America (including Central America), and who maintain tribal 
affiliation or community attachment.
    Two or More Races (Not Hispanic or Latino)--All persons who 
identify with more than one of the above five races.
    \9\ The ten job groups are: Executive/Senior Level Officials and 
Managers; First/Mid Level Officials and Managers; Professionals; 
Technicians; Sales Workers; Administrative Support Workers; Craft 
Workers; Operatives; Laborers and Helpers; Service Workers.

Adding Pay Data to the EEO-1

    In 1964, Congress enacted Title VII of the Civil Rights Act, as 
amended, 42 U.S.C. 2000e, et seq., (Title VII), which makes unlawful a 
wide range of discriminatory employment practices, including pay 
discrimination, because of race, color, religion, national origin, or 
sex. The EEOC is responsible for enforcing Title VII and other federal 
laws prohibiting employment discrimination, including the Equal Pay Act 
of 1963.\10\ The Equal Pay Act prohibits sex-based wage discrimination 
between men and women if they work in the same establishment and 
perform jobs that require substantially equal skill, effort, and 
responsibility under similar working conditions.\11\ OFCCP enforces 
Executive Order 11246, as amended, which prohibits discrimination, 
including compensation discrimination, based on race, color, religion, 
sex, sexual orientation, gender identity, or religion.\12\

    \10\ 29 U.S.C. 206(d).
    \11\ Id. Enforcement of the Equal Pay Act was transferred from 
the DOL to the EEOC in 1978. 5 USCA APP. 1 REORG. PLAN 1 1978.
    \12\ See Department of Labor, Office of Federal Contractor 
Compliance Programs, Exec. Order 11246 as amended,

    In 2010, the EEOC joined other federal agencies, including the DOL, 
as members of the President's National Equal Pay Task Force to identify 
ways to improve enforcement of federal laws prohibiting pay 
discrimination. The Task Force recommended, among other things, that 
the EEOC engage the National Academy of Sciences (NAS) to conduct a 
study assessing how to most effectively collect pay data to support its 
wage discrimination law enforcement efforts. The EEOC accordingly 
commissioned a study, and the NAS convened a Panel on Measuring and 
Collecting Pay Information from U.S. Employers by Gender, Race, and 
National Origin. This Panel's August 15, 2012, report (NAS Report) \13\ 
recognized the potential value for enforcement of collecting pay data 
from employers by sex, race, and national origin through a survey such 
as the EEO-1, and emphasized the importance of a definitive plan for 
how the data would be used in coordination with other equal employment 
opportunity (EEO) enforcement agencies. The NAS Report also recommended 
that the EEOC conduct a pilot to inform the parameters for any pay data 

    \13\ National Research Council. 2012. Collecting Compensation 
Data From Employers. Washington, DC: National Academies Press, 8. 
Available at
    \14\  Id. at 87-88.

    Following the NAS Report recommendation, the EEOC commissioned an 
independent Pilot Study to identify the most efficient means to collect 
pay data. The Pilot Study, completed in September 2015, assisted the 
EEOC in formulating this proposal and will guide the development of 
analytic techniques to make full use of the data to be collected.\15\ 
The Pilot Study considered a variety of statistical approaches that 
could be used to detect pay differences between groups and then tested 
these approaches by applying them to synthetic pay data \16\ in order 
to identify their strengths and weaknesses.\17\ Ultimately, the Pilot 
Study made technical recommendations about several central components 
of a data collection, including: The unit of pay to be collected; the 
best summary measures of central tendency and dispersion for rates of 
pay; appropriate statistical test(s) for analyzing pay data; and the 
most efficient and least costly methods for transmitting pay data from 
employers. The Pilot Study also estimated employer burden-hour costs 
and the processing costs associated with the recommended method of 

    \15\ ``EEOC Pay Pilot Study,'' September, 2015, Sage Computing. 
Available at:
    \16\ Two ``synthetic'' data bases were used. The first synthetic 
data base used data from the auto parts manufacturing industry and 
the Occupation Employment Statistics (OES) as well as EEO-1 data to 
construct a hypothetical firm in the auto parts manufacturing 
industry. To do so, the number of employees by EEO-1 job groups in 
an average sized firm was estimated. EEO-1 job groups were then 
mapped to the Standard Occupational Classification (SOC) categories 
in the OES data. Using OES statistics on the distribution of annual 
wages within SOC categories, the likely wages for EEO-1 job groups 
in an average firm were generated. These samples represent typical 
or representative wages, not actual wages, for auto parts employees. 
See Pilot Study, page 79. The second data base used data extracts 
from Current Population Survey (CPS) data (downloaded from March CPS Annual Social and Economic Supplement). The 
data were downloaded from the International Public Use Microdata 
Series Web site for the 2010 to 2014 period. (King, M., S. Ruggles, 
J.T. Alexander, S. Flood, K. Genadek, M.B. Schroeder, B. Trampe, and 
R. Vick. 2010. Integrated Public Use Microdata Series, Current 
Population Survey: Version 3.0. [Machine-readable database]. 
Minneapolis: University of Minnesota.) See Pilot Study, page 56.
    \17\ Synthetic pay data was used because conducting a test 
survey of nine or more companies would require PRA approval. 44 
U.S.C. 3502(3)(A)(i).

    Separately, the EEOC sought input about updating all the EEO 
surveys, including adding pay data, when its staff held a two-day 
meeting in March 2012 with employer representatives, statisticians, 
human resources information systems (HRIS) experts, and information 
technology specialists

[[Page 5115]]

(work group). The work group reviewed the current data collection 
procedures, provided feedback on future modernization of the EEO 
surveys, and engaged in brainstorming that led to ideas submitted 
individually by group participants on a number of topics, including 
collecting pay data as well as multiple-race category data on the EEO-
1. Employer stakeholders expressed concern about the importance of 
maintaining the confidentiality of any individual filer's pay data even 
if pay data were only published in aggregated form.\18\ The work group 
report \19\ reflects feedback from participants that the burden of 
reporting pay data would be minimal for EEO-1 filers.

    \18\ For example, reporting the average pay for Hispanic or 
Latino women who are Executive/Senior Level Officials and Managers, 
if there are few Hispanic or Latino women in that job group, may 
effectively reveal the pay of individual employees. To allay these 
concerns, the EEOC intends to re-examine the rules for testing 
statistical confidentiality for publishing aggregate data to make 
certain that tables with small cell-counts are not made public.
    \19\ ``EEOC Survey System Modernization Work Group Meeting, 
Draft Report,'' March 19, 2012, Sage Computing. Available at:

    On April 8, 2014, the Presidential Memorandum, ``Advancing Pay 
Equality Through Compensation Data Collection'' was issued. It directed 
the Secretary of Labor to develop a compensation data collection 
proposal.\20\ OFCCP issued a Notice of Proposed Rulemaking (NPRM) on 
August 8, 2014, proposing to amend one of its implementing regulations 
for Executive Order 11246 to add a requirement that certain federal 
contractors submit compensation data reports to OFCCP.\21\ Under the 
NPRM, OFCCP also proposed a sample of an Equal Pay Report for 
collecting this data.\22\

    \20\ Presidential Documents, Memorandum of April 8, 2014, 
``Advancing Pay Equality Through Compensation Data Collection,'' 
Memorandum for the Secretary of Labor, April 11, 2014 (79 FR 20751).
    \21\ Government Contractors, Requirement to Report Summary Data 
on Employee Compensation, 79 FR 46563 (August 8, 2014). This NPRM 
provided detailed explanations for the design of the Equal Pay 
Survey, which utilized W-2 information as a measure of wages and 
reported cumulative wages. It did not use pay bands like Component 2 
of the currently proposed EEO-1. In 2011, OFCCP had issued an 
Advance Notice of Proposed Rulemaking (ANPRM). Nondiscrimination in 
Compensation: Compensation Data Collection Tool, 79 FR 49398 (August 
10, 2011), in response to which stakeholders provided extensive 
input and information.
    \22\ Office of Information and Regulatory Affairs and Office of 
Management and Budget, Equal Pay Report,

    Public comments submitted to OFCCP about the proposed Equal Pay 
Report and rule argued for, among other things, the need to improve 
interagency coordination and decrease employer burden for reporting 
compensation data by using the EEO-1, rather than a new OFCCP data 
collection, as well as the need to protect privacy and data 
confidentiality. The instant proposal responds to these concerns.\23\ 
Similarly, the NAS Report recommended that the federal EEO enforcement 
agencies develop a coordinated plan for using compensation data. In the 
course of developing this EEO-1 proposal, the EEOC and OFCCP together 
consulted with the Department of Justice, focusing on how EEO-1 pay 
data would be used to assess complaints of discrimination, focus 
investigations, and identify employers with existing pay disparities 
that might warrant further examination. The EEOC and OFCCP plan to 
develop statistical tools that would be available to staff on their 
computers, to utilize the EEO-1 pay data for these purposes. They also 
anticipate developing software tools and guidance for stakeholders to 
support analysis of aggregated EEO-1 data. Finally, the EEOC and OFCCP 
anticipate that the process of reporting pay data may encourage 
employers to self-monitor and comply voluntarily if they uncover pay 

    \23\ OFCCP plans to utilize EEO-1 pay data for federal 
contractors with 100 or more employees instead of implementing a 
separate compensation data survey as outlined in its August 8, 2014, 

    The following discussion explains the justification for each 
component of the proposed EEO-1 pay data collection. As stated above, 
this proposal does not compel employers to collect new data but rather 
requires the reporting of pay data that employers maintain in the 
normal course of business. This notice proposes a collection that will 
maximize the utility of the pay data while balancing respondent 
concerns about confidentiality and the burden of the collection.

Proposal To Add Pay Data to the EEO-1

Who Will Report Pay Data and When This Reporting Requirement Will Start
    For the 2016 EEO-1 reporting cycle, to ease the transition, all 
employers will submit information that is identical to the information 
collected by the currently approved EEO-1 (Component 1). Starting in 
2017, employers that are subject to the EEO-1 reporting requirement and 
that have 100 or more employees will submit the EEO-1 with pay and 
related information (Components 1 and 2). By contrast, contractors that 
are subject to the EEO-1 reporting requirement and that have between 50 
and 99 employees will continue to submit the same information that is 
collected by the current EEO-1 report (Component 1). They will not be 
required to submit pay and hours-worked data. A sample copy of the 
currently approved EEO-1 report provides an illustration of the data to 
be collected by Component 1. It can be found at An illustration of the data to 
be collected by both Components 1 and 2 can be found at
When Annual EEO-1 Reports Will Be Due and How Employers Will Submit 
    Currently, employers must collect EEO-1 data from any pay period 
occurring in the months of July through September of the current survey 
year. The EEO-1 must be filed by September 30th of the same year. These 
deadlines would continue after the addition of pay data, to minimize 
employers' burden by folding the new collection into long-established 
deadlines. As explained below regarding the utility and burden of using 
W-2 data to describe pay, requiring filers to report W-2 data as of a 
pay period occurring in the months of July through September should not 
be burdensome given the capabilities of HRIS software.
    Beginning in 2017, all filers will be required to submit the 
proposed EEO-1 report electronically. Automated electronic data 
collection promotes the utility of the EEO-1 survey by reducing the 
number of inadvertent human errors in the data. Electronic data 
collection also is less burdensome for employers than assigning staff 
to complete the survey. As of 2014, all but three of the 67,146 EEO-1 
filers already used electronic data submission.\24\ Any EEO-1 filer 
seeking an exemption from this electronic requirement may use the 
existing EEO-1 process for seeking special reporting procedures.\25\

[[Page 5116]]

Component 2 of the revised EEO-1 includes a request for data on the 
amount of employer staff time used to collect and report pay data on 
the EEO-1. This will better enable the EEOC to quantify the burden of 
this aspect of the survey.

    \24\ The remaining three filers submitted hard copy reports.
    \25\ The EEO-1 instructions provide that ``[a]n employer who 
claims that preparation or the filing of Standard Form 100 would 
create undue hardship may apply to the Commission for a special 
reporting procedure. In such cases, the employer must submit in 
writing a detailed alternative proposal for compiling and reporting 
information to: The EEO-1 Coordinator, EEOC-Survey Division, 131 M 
Street NE., Washington, DC 20507. Only those special procedures 
approved in writing by the Commission are authorized. Such 
authorizations remain in effect until notification of cancellation 
is given. All requests for information should be sent to the address 
above.'' See Any requests would be considered by the EEO-1 
Coordinator, who is also responsible for issuing any written 

What Pay Data Will Be Collected
Measure: Total W-2 Earnings
    In selecting total W-2 earnings as the measure of pay, the focus 
was on maximizing utility of the EEO-1 pay data while minimizing the 
burden on employers to collect and report it. With respect to 
maximizing utility, the goal was to identify a measure of compensation 
that encompasses as much employer-paid income earned by individuals as 
possible. With respect to minimizing burden, the focus was on finding a 
measure that is well-defined and compatible with the data elements in 
employers' existing human resources and pay systems. Consideration also 
was given to the sample Equal Pay Report proposed in OFCCP's 2014 
Notice of Proposed Rulemaking, which used W-2 earnings.\26\

    \26\ In the NPRM, OFCCP stated that it chose the W-2 definition 
of compensation because it accounts for a broad range of pay 
elements and because collection of W-2 data would result in minimal 
burden on contractors. 79 FR 46562 at 46576 (August 8, 2014). Public 
comments on the NPRM were split on using the W-2, but EEOC and OFCCP 
conclude that it remains the best option for the reasons stated in 
this section.

    Five different measures of earnings now used by federal data 
collection systems were considered. The first three were from the U.S. 
Bureau of Labor Statistics (BLS): The Occupation Employment Statistics 
(OES); \27\ the National Compensation Survey (NCS); \28\ and the 
Current Employment Statistics (CES) survey program.\29\ The remaining 
options were from the Social Security Administration (SSA) \30\ and the 
Internal Revenue Service (IRS).\31\

    \27\ The Occupation Employment Statistics (OES) survey defines 
earnings to include base rate pay, cost-of-living allowances, 
guaranteed pay, hazardous-duty pay, incentive pay such as 
commissions and production bonuses, tips, and on-call pay. The OES 
measure excludes back pay, jury duty pay, overtime pay, severance 
pay, shift differentials, nonproduction bonuses, employer costs for 
supplementary benefits, and tuition reimbursements. See U.S. Bureau 
of Labor Statistics, Occupation Employment Statistics. See page 4 of for the 12 wage 
    \28\ The National Compensation Survey (NCS) is a BLS 
establishment survey of employee salaries, wages, and benefits. In 
this survey, ``[e]arnings are defined as regular payments from 
employers to their employees as compensation for straight-time (not 
overtime) hourly wages or for any salaried work performed.'' The NCS 
does not include premium pay for overtime, holidays, and weekends; 
shift differentials such as night work; nonproduction bonuses; tips; 
and uniform and tool allowances. See U.S. Bureau of Labor 
Statistics, Overview on BLS Statistics on Pay and Benefits,, at 
pp 8-9. However, this definition does include incentive pay such as 
commissions, piece-rate payments, production bonuses, cost-of- 
living adjustments, hazard pay, payments for income deferred due to 
participation in a salary reduction plan, and deadhead pay (which is 
paid to a driver who is driving an empty vehicle, typically when the 
driver is traveling to pick up a delivery or after completion of a 
    \29\ The Current Employment Statistics (CES) survey program is a 
BLS and state cooperative program that produces data on earnings but 
not wages. Average hourly earnings exclude items such as employee 
benefits, irregular bonuses and commissions, retroactive payments, 
and the employers' share of payroll taxes and therefore, do not 
represent employers' total compensation costs (as calculated by the 
National Compensation Survey). See National Research Council. 
Collecting Compensation Data from Employers. National Academic Press 
2013., at p. 8.
    \30\ The Social Security Administration defines income as any 
payment received during a calendar month that can be used to meet 
needs for food or shelter. It may be in cash or in kind (i.e., 
payment in the form of the use of a good or service, such as free 
rent). It includes earned income and unearned income. Examples of 
unearned income include social security, interest and dividends, 
retirement income, unemployment benefits, alimony, child support, 
and pay received for work while an inmate in a penal institution. 
    \31\ The Internal Revenue Service's W-2 definition of gross 
income includes wages, salaries, fees, commissions, tips, taxable 
fringe benefits, and elective deferrals. Amounts withheld for taxes, 
including but not limited to income tax, Social Security, and 
Medicare taxes, are considered ``received'' and must be included in 
gross income of the given year they are withheld. See; see also

    Of these five options, the focus was on the relative strengths and 
weaknesses of the OES and the W-2 definitions because they are best 
known to employers. The NAS Study recommended the use of OES' wage 
definition because it is based on widespread surveys,\32\ but the EEOC 
ultimately decided not to use the OES definition because it excludes 
widely-used elements of compensation such as overtime pay, severance 
pay, shift differentials, nonproduction bonuses, year-end bonuses, 
holiday bonuses, and tuition reimbursement.\33\ These elements of pay, 
however, are increasingly important. According to a 2014 survey of 
1,064 U.S. companies, ``91 percent of organizations offer a variable 
pay program and expect to spend 12.7 percent of payroll on variable pay 
for salaried exempt employees in 2015.'' \34\ Another recent survey of 
companies' bonus practices found that 74 percent of respondents used a 
sign-on bonus program and 61 percent used a retention bonus program in 

    \32\ National Research Council, 2012, Collecting Compensation 
Data From Employers. Washington, DC: National Academies Press, 8. 
Available at, at 
    \33\ United States Department of Labor, Bureau of Labor 
Statistics, Occupational Employment Statistics-Frequently Asked 
    \34\ See Press Release, Aon Hewitt, 2014 U.S. Salary Increase 
Survey, (Aug. 27, 2014),
    \35\ WorldatWork. ``Bonus Programs and Practices.'' Available at, at p.10.

    By contrast, the W-2 definition provides a more comprehensive 
report of earnings at the employee level than the OES definition. W-2 
gross income includes wages, salaries, fees, commissions, tips, taxable 
fringe benefits, and elective deferrals. Amounts withheld for taxes, 
including but not limited to income tax, Social Security, and Medicare 
taxes, are considered ``received'' and are included as gross income of 
the given year they are withheld.\36\ The W-2 encompasses all earned 
income, including supplemental pay components such as overtime pay, 
shift differentials, and nonproduction bonuses (e.g., year-end bonuses, 
hiring and referral bonuses, and profit-sharing cash bonuses).\37\ 
Nonproduction bonuses account for over 11 percent of cash compensation 
for management, business, and financial operations occupations, while 
shift differentials are a significant component of compensation for 
healthcare workers.\38\ A panel of HRIS experts convened for the Pilot 
Study agreed that the trend is toward paying higher-level executives in 
bonuses, which are

[[Page 5117]]

counted as W-2 income but are not included in the OES definition.\39\

    \36\ Internal Revenue Service. 2014. ``Wages, Salaries, and 
Other Earnings.'' In: Internal Revenue Service. Your Federal Income 
Tax (Individuals). Available at and Internal Revenue Service. 2015. ``What Is Earned 
Income?'' Available at
    \37\ U.S. Dept. of Labor, Bureau of Labor Statistics. ``Fact 
Sheet for the June 2000 Employment Cost Index Release.'' Available 
    \38\ John L. Bishow, U.S. Dept. of Labor, Bureau of Labor 
Statistics. ``A Look at Supplemental Pay: Overtime Pay, Bonsues, and 
Shift Differentials.'' Available at at pp 5-7. ``Analysis is limited to jobs that 
receive positive payments--that is, those jobs that actually receive 
supplemental pay, as opposed to the average for all jobs--the 
percentage for each type of supplemental pay is higher.''
    \39\ The panel included individuals with expertise in HRIS and 
SAP, and in compensation, payroll, and benefits.

    Using the W-2 definition is less likely to be burdensome for most 
respondents than using the OES wage definition. Federal law requires 
all employers to generate W-2s for each of their employees. Although W-
2 data may not be routinely compiled until the end of the calendar 
year, and EEO-1 reports are due on September 30th, several approaches 
are possible. First, because payroll records are cumulative, generating 
reports at any given point in time should not be complicated for 
employers with automated payroll systems. The W-2 data can be imported 
into a HRIS, and a data field can be established to accumulate W-2 data 
for the EEO-1. Alternatively, employers could obtain this pay 
information by utilizing quarterly payroll reports for the previous 
four quarters. Employers that do their payroll in-house will be able to 
report this data utilizing most major payroll software systems or by 
using off-the-shelf payroll software that is preprogrammed to compile 
data for generating W-2s. For employers that outsource their payroll, 
there would be a one-time burden of writing custom programs to import 
the data from their payroll companies into their HRIS systems.
Organizing and Reporting W-2 Data
    In determining how employers would be required to organize and 
report their employees' W-2 data, the focus was on collectability, 
burden, confidentiality, and data utility.\40\ The NAS Report and the 
Pilot Study reviewed various alternative approaches for reporting 
compensation, which ranged from highly detailed to general. Of these 
alternatives, the most comprehensive collection proposals required 
collecting data at the individual employee level and would have 
included human capital qualifications data as well as pay data. 
Although these options would reduce ambiguity and help assess the 
existence of potential discrimination, they also raise significant 
confidentiality and burden concerns.\41\

    \40\ Collecting Compensation Data from Employers, National 
Academies of Science
    \41\ See supra note 19, at 2.

    Options for collecting aggregate pay data include using pay rates 
(calculated by employer), range of pay with a maximum and minimum 
provided by employer, total pay, and average or median pay. There are 
disadvantages to each of these approaches. Total pay could be 
impractical and would be dependent on the number of employees. Average 
pay by occupation would provide limited information about variation. 
Collecting the range of pay or average pay could produce biased 
estimates as pay is often distributed in a manner where a few 
individuals are paid much more than others. This might create 
misleading data when ranges or means are used as a measure. Simply 
gathering rates of pay, without standard deviation measures, would not 
assist in parity/disparity analysis, and asking employers to calculate 
standard deviations would not only be burdensome but also would risk a 
higher rate of inaccuracy.
    Using pay bands appears to be more likely to generate reliable data 
while being less burdensome for employers than other reporting 
alternatives. Therefore, Component 2 of the revised EEO-1 will collect 
aggregate W-2 data in 12 pay bands for the 10 EEO-1 job categories. 
Employers will simply count and report the number of employees in each 
pay band. For example, a filer will report on the EEO-1 that it employs 
3 African American women as professionals in the highest pay band. As 
to data utility, pay bands will allow the EEOC to compute within-job-
category variation, across-job-category variation, and overall 
variation, which would support the EEOC's ability to discern potential 
discrimination while preserving confidentiality.\42\ At the same time, 
pay bands would not require the computation of mean earnings or a 
measure of variance as alternative approaches might, thus avoiding a 
source of employer burden. Finally, as distinguished from mean 
earnings, pay bands can effectively use statistical tests that do not 
rely on an assumption that pay is normally distributed.

    \42\ See also Micklewright, John and Schnepf, Sylke V., How 
Reliable are Income Data Collected with a Single Question? (November 
2007). See also IZA Discussion Paper No. 3177,

    By choosing to use pay bands, the EEOC also is adopting a 
methodology that will limit employer burden. HRIS software developers 
already are familiar with using pay bands on the EEO-4 survey, which 
collects pay data from state and local government employers.\43\ By 
choosing to use pay bands for the EEO-1, the EEOC and OFCCP will allow 
HRIS software developers to build on their existing experience with the 
EEO-4. Consistent with the recommendations of the Pilot Study, however, 
the EEO-1 pay bands (Table 2) will track the 12 ``wage intervals'' used 
by the Bureau of Labor Statistics in the OES survey.\44\

    \43\ See U.S. Equal Employment Opportunity Commission, EEO-4 
    \44\ See Survey Methods and Reliability Statement for the May 
2014 Occupational Employment Statistics Survey.

                        Table 1--EEO-4 Pay Bands
              Pay bands                         Pay bands label
1....................................  $100-$15,999.
2....................................  $16,000-$19,999.
3....................................  $20,000-$24,999.
4....................................  $25,000-$32,999.
5....................................  $33,000-$42,999.
6....................................  $43,000-$54,999.
7....................................  $55,000-$69,999.
8....................................  $70,000 and over.

                   Table 2--Proposed EEO--1 Pay Bands
              Pay bands                         Pay bands label
1....................................  $19,239 and under.
2....................................  $19,240-$24,439.
3....................................  $24,440-$30,679.
4....................................  $30,680-$38,999.
5....................................  $39,000-$49,919.
6....................................  $49,920-$62,919.
7....................................  $62,920-$80,079.
8....................................  $80,080-$101,919.
9....................................  $101,920-$128,959.
10...................................  $128,960-$163,799.
11...................................  $163,800-$207,999.
12...................................  $208,000 and over.

Hours Worked
    Consistent with the recommendations of the Pilot Study, Component 2 
of the revised EEO-1 will collect the total number of hours worked by 
the employees included in each EEO-1 pay band cell. This data will 
allow analysis of pay differences while considering aggregate 
variations in hours. The total hours worked also will permit an 
analysis that accounts for periods when the employees were not 
employed, thus reflecting part-time work.\45\

    \45\ Collection of the hours-worked data will account for the 
fact that some individuals are employed for less than the entire 
reporting year, and therefore, may work fewer hours. For example, if 
a large number of women are hired part way into a reporting year, 
their W-2 compensation will be lower than the compensation of men 
who worked for the entire reporting year.

    The EEOC seeks employer input with respect to how to report hours 
worked for salaried employees. One approach would be for employers to 
use an estimate of 40 hours per week for full-time salaried workers. 
The EEOC is not proposing to require an employer to begin collecting 
additional data on actual hours worked for salaried workers, to the 
extent that the employer does not currently maintain such

[[Page 5118]]

information. Employers are encouraged to comment on this issue.\46\

    \46\ Some commentators on OFCCP's proposed data collection 
suggested that hours-worked data should not be collected based, in 
part, on their concerns that the collection would be burdensome and 
that some employers do not collect this data for exempt employees. 
For this reason, the EEOC encourages employers to provide specific, 
detailed input on this aspect of its proposed data collection.

    Generally, however, the initial conclusion is that requiring 
employers to provide the total number of hours worked would impose a 
minimal burden. Employers will report only data that they already 
maintain. The panel of HRIS experts convened for the Pilot Study 
reported that ``total hours worked'' data is maintained by almost all 
payroll systems. The information is available for the previous quarter, 
the previous four quarters, and the calendar year. For employers that 
outsource payroll, this variable could be added to the one-time 
reporting query that is written to download income data.
Analysis of W-2 Pay Data
    Statistical tests will be used as an initial check of the W-2 data 
to be collected on the EEO-1, specifically, statistical significance 
tests that do not rely on an assumption of a normal distribution. The 
Pilot Study recommended several statistical techniques to test within-
job categories and then suggested further examining companies and 
establishments with low probabilities that the differences between 
examined groups, such as men and women, occurred by chance.\47\ The 
Pilot Study also noted that the issue of calibrating error rates (power 
vs. significance level) needed to be addressed to detect discrimination 
without suffering too many false positives. This process would include 
recognition of how sample sizes may influence results and also of 
judicial precedents regarding definitions of statistical 

    \47\ For example, the Pilot Study recommends using the Mann-
Whitney test for grouped data and comparison of two groups (for 
example, gender (men versus women) or race (African Americans versus 
Whites)), and the Kruskal-Wallis test for comparison of more than 
two groups (e.g., race). These tests are the most appropriate for an 
initial review of establishments as a whole. Analyses can be 
conducted by computing the statistical tests within job categories 
and then proceeding to more closely investigate companies and 
establishments with low p-values. Interval regressions can be used 
to examine the impact of hours worked, race and gender on 
distributions within pay bands. It may also be appropriate to 
compare a particular firm's regression coefficients for the hours 
worked, race and gender variables to those derived from an analysis 
of the relevant labor market as a whole.
    \48\ The EEOC's statistical analysis techniques are consistent 
with judicially recognized statistical standards for identifying 
meaningful discrepancies. Hazelwood Sch. Dist. v. United States, 433 
U.S. 299, 311 n.17 (1977) (``a fluctuation of more than two or three 
standard deviations would undercut the hypothesis that decisions 
were being made randomly with respect to [a protected trait]);'' see 
also, Wright v. Stern, 450 F.Supp.2d 335, 363 (S.D.N.Y. 2006) (court 
denied employer's motion for summary judgment, concluding that the 
plaintiffs presented sufficient statistical and other evidence for a 
jury to conclude that the employer engaged in widespread 
discrimination against African-American and Hispanic employees, in 
terms of promotions and compensation. The court noted that, 
``[t]hough not dispositive, statistics demonstrating a disparity of 
two standard deviations outside of the norm are generally considered 
statistically significant.'')

    The EEOC and OFCCP plan to develop a software tool that will allow 
their investigators to conduct an initial analysis by looking at W-2 
pay distribution within a single firm or establishment, and by 
comparing the firm's or establishment's data to aggregate industry or 
metropolitan-area data.\49\ This application would highlight statistics 
of interest.

    \49\ Operationally, this application, or dashboard, could relate 
the nominal results of statistical tests (that is, test statistics 
or their p-values) to those encountered in the location and the 
labor market based on the relevant industry and geography. On such a 
dashboard, the EEOC investigator would see technical information 
such as the values of the main statistics used to describe the 
establishment, and its relation to the same statistic encountered in 
other comparable establishments.

    The EEOC and OFCCP jointly collect the data on the EEO-1 report 
through their Joint Reporting Committee, which has represented the two 
agencies for the purpose of administering the EEO-1 since the reporting 
requirement began. All data is initially submitted to the Joint 
Reporting Committee housed at the EEOC and then provided to OFCCP. EEOC 
is required to hold its EEO-1 data confidential under Section 709(e) of 
Title VII, which forbids ``any [EEOC] officer or employee'' from making 
``public in any manner whatever any information obtained by the 
Commission . . . prior to the institution of any [Title VII] proceeding 
. . . involving such information.'' 42 U.S.C. 2000e-8(e). Any EEOC 
officer or employee who violates this prohibition is guilty of a 
misdemeanor. Id.
    The EEOC publishes aggregate EEO-1 data in a manner that does not 
reveal any particular employer's data, consistent with Section 709(e). 
For example, the EEOC has published aggregate EEO-1 data at the 
national, regional, and industry levels.\50\ The EEOC also publishes 
reports analyzing aggregate EEO-1 data based on industry (e.g., 
finance, media, and law firms) or particular groups of people (e.g., 
women of color).\51\

    \50\ See U.S. Equal Employment Opportunity Commission, ``Job 
Patterns for Minorities and Women in Private Industry (EEO-1),
    \51\ See U.S. Equal Employment Opportunity Commission, Special 

    After collecting and reconciling EEO-1 data, the Joint Reporting 
Committee at the EEOC provides a database to OFCCP. OFCCP holds 
confidential the data for contractor filers to the maximum extent 
permitted by law, in accordance with Exemption 4 of the Freedom of 
Information Act and the Trade Secrets Act.\52\ With respect to EEO-1 
data for companies that are not under OFCCP's jurisdiction, the 
confidentiality provisions of Section 709(e) apply.\53\ Accordingly, 
OFCCP refers all requests for such data to the EEOC for a response.

    \52\ See 5 U.S.C. 552 (b)(4). FOIA does not apply to ``trade 
secrets and commercial or financial information obtained from a 
person and privileged or confidential''; 18 U.S.C. 1905. Under the 
Trade Secrets Act, criminal penalties may apply to an officer or 
employee of the United States who ``publishes, divulges, discloses, 
or makes known in any manner or to any extent not authorized by law 
. . . confidential statistical data. . . .'' See also 79 FR 46562 at 
46583 (August 8, 2014).
    \53\ See relevant Paperwork Reduction Act provision, 44 U.S.C. 
3510. ``(a) The Director may direct an agency to make available to 
another agency, or an agency may make available to another agency, 
information obtained by a collection of information if the 
disclosure is not inconsistent with applicable law. (b)(1) If 
information obtained by an agency is released by that agency to 
another agency, all the provisions of law (including penalties) that 
relate to the unlawful disclosure of information apply to the 
officers and employees of the agency to which information is 
released to the same extent and in the same manner as the provisions 
apply to the officers and employees of the agency which originally 
obtained the information. (2) The officers and employees of the 
agency to which the information is released, in addition, shall be 
subject to the same provisions of law, including penalties, relating 
to the unlawful disclosure of information as if the information had 
been collected directly by that agency.''

Paperwork Reduction Act Statement

    The EEOC intends to submit to OMB a request for a three-year PRA 
approval of a revised EEO-1. The revised EEO-1 data collection has two 
components. The first component (Component 1) will collect information 
identical to that collected by the currently approved EEO-1. The second 
component (Component 2) will collect data on employees' W-2 pay and 
hours worked. Component 1 can be found at An illustration of the data to 
be collected by both Components 1 and 2 can be found at
    For the 2016 reporting cycle, EEO-1 filers would only submit the 
Component 1 data. Beginning with the 2017 reporting cycle, the EEOC 
proposes to

[[Page 5119]]

require EEO-1 filers with 100 or more employees to submit Component 2 
data in addition to Component 1 data. However, contractor filers with 
50 to 99 employees will only submit Component 1 data.

2016 Overview of Information Collection--Component 1

    Collection Title: Employer Information Report (EEO-1).
    OMB Control Number: 3046-0007.
    Frequency of Report: Annual.
    Description of Affected Public: Private industry filers with 100 or 
more employees and federal government contractor filers with 50 or more 
    Number of Respondents: 67,146.
    Reporting Hours: 228,296.4.
    Respondent Burden Hour Cost: $5,531,621.77.
    Federal Cost: $1,330,821.
    Number of Forms: 1.
    Form Number: EEOC Form 100.

2017 and 2018 Overview of Information Collection--Components 1 and 2

    Collection Title: Employer Information Report (EEO-1).
    OMB Control Number: 3046-0007.
    Frequency of Report: Annual.
    Number of Forms: 1.
    Form Number: EEOC Form 100.
    Federal Cost: $318,000 for one-time costs and $1,621,300 \54\ for 
recurring staffing costs.

    \54\ The addition of W-2 pay data to the EEO-1 is expected to 
increase EEOC's internal staffing costs by approximately $290,478. 
The annual federal cost figure of $1,621,300 includes both the 
increase in contract costs resulting from the addition of the pay 
data collection and the estimated internal staffing costs. It 
reflects an increase of more than $290,478 compared to the estimated 
federal costs provided in previously published Federal Register 
notices seeking PRA approval of this information collection because 
past estimates reflected the cost of the contract with the vendor 
whose services the EEOC procures to assist with administration and 
processing of the EEO-1 but did not include EEOC's internal staffing 
costs associated with processing the EEO-1.

Component 1 (Demographic and Job Category Data)
    Description of Affected Public: In 2017 and 2018, contractor filers 
with 50 to 99 employees will submit only the demographic and job 
category data collected by Component 1.
    Number of Respondents: 6,260.
    Reporting Hours: 21,284.
    Respondent Burden Hour Cost: $515,711.32.
Components 1 and 2 (Demographic and Job Category Data Plus Pay and 
Hours-Worked Data)
    Description of Affected Public: In 2017 and 2018, EEO-1 filers with 
100 or more employees will submit pay and hours-worked data under 
Component 2 in addition to the demographic and job category data under 
Component 1.
    Number of Respondents: 60,886.
    Reporting Hours: 401,847.6.
    Respondent Burden Hour Cost: $9,736,767.35.

PRA Burden Statement

2016: Component 1
    Burden Statement: In 2016, all EEO-1 filers will submit only 
Component 1, which includes the data collected by the currently 
approved EEO-1. The estimated number of respondents required to submit 
the annual EEO-1 survey is 67,146.\55\ This data collection is 
estimated to impose 228,296.4 burden hours in 2016 or 3.4 hours per 
filer.\56\ See Table 3. The estimated burden is based on electronic, 
rather than paper filing, which significantly reduces the survey 

    \55\ In 2014, 67,146 firms filed EEO-1 reports.
    \56\ In 2014, all but three reporting firms submitted 
electronic, rather than paper survey responses. These burden 
estimates assume that virtually all respondents will continue to 
file electronically.

                                   Table 3--Annual Burden--2016 (Component 1)
 [All EEO-1 filers: Private industry employers with 100 or more employees and Federal Government contractors and
                              first-tier subcontractors with 50 or more employees]
                                  Annual burden                    Total annual                    Total burden
                                      hours          Filers        burden hours      Wage rate       hour cost
Reading instructions...........             0.5          67,146         33,573            $24.23     $813,473.79
Collecting, verifying,                      2.9          67,146        194,723.4           24.23    4,718,147.98
 validating and reporting data.
    Total......................             3.4          67,146        228,296.4  ..............    5,531,621.77

2017 and 2018: Components 1 and 2
    Burden Statement--Component 1 Only: Starting in 2017, the estimated 
number of annual respondents who are contractor filers with 50 to 99 
employees is 6,260.\57\

    \57\ Of the 67,146 firms that filed EEO-1 reports in 2014, 6,260 
were federal contractor filers with fewer than 100 employees.

    The burden on these contractor filers is estimated as follows:
     Annual Burden Calculation: The estimated total annual 
burden hours required to complete Component 1 of the EEO-1 data 
collection in 2017 and 2018 is 21,284, with an associated total annual 
burden hour cost of $515,711.32.\58\ See Table 4.

    \58\ This estimate is calculated as follows: 3.4 hours per 
respondent x 6,260 respondents = 21,284 hours x $24.23 per hour = 
$515,711.32. See Bureau of Labor Statistics in the publication 
``Employer Costs for Employee Compensation'' (December 2013), which 
lists total compensation for administrative support as $24.23 per 
(last accessed September 23, 2014).

    Burden Statement--Components 1 and 2: Starting in 2017, the 
estimated number of annual respondents that will submit Components 1 
and 2 is 60,886 private industry and contractor filers. Filers required 
to complete both Components 1 and 2 are estimated to incur 401,847.6 
burden hours annually or 6.6 hours per filer. The estimated burden is 
based on electronic, rather than paper, filing, which significantly 
reduces the survey burden.
    The burden imposed on all private industry employer filers and 
contractor filers with 100 or more employees as a result of the 
proposed collection of W-2 pay data is estimated as follows:
     Annual Burden Calculation: The estimated total annual 
burden hours needed for filers to report demographic and W-2 pay data 
via Components 1 and 2 of the revised EEO-1 Report is 401,847.6, with 
an associated total annual burden hour cost of $9,736,767.35. This 
burden estimate includes reading instructions and collecting, merging, 
validating, and reporting the data electronically.\59\ See Table 4.

    \59\ This estimate is calculated as follows: 6.6 hours per 
respondent x 60,886 respondents = 401,847.6 hours x $24.23 per hour 
= $9,736,767.35. See Bureau of Labor Statistics in the publication 
``Employer Costs for Employee Compensation'' (December 2013), which 
lists total compensation for administrative support as $24.23 per 
(last accessed September 23, 2014).


[[Page 5120]]

     One-Time Implementation Burden: The estimated one-time 
implementation burden hour cost for submitting the information required 
by Component 2 of the revised EEO-1 Report is $23,000,295.\60\ This 
calculation is based on the one-time cost for developing queries 
related to Component 2 in an existing human resources information 
system, which is estimated to take 8 hours per filer at a wage rate of 
$47.22 per hour.

    \60\ This is estimate is calculated as follows: 8 h