What Is Going On With The Revised EEO-1 Form? Acting EEOC Chair Provides Insight Into Its Status

As loyal readers of our blog are aware, in February 2016, the EEOC released a rule to amend the Form EEO-1.  The new rule requires private employers (including federal contractors) with 100 or more employees to submit pay data with their EEO-1 reports.  Employers with fewer than 100 employees will still not need to file an EEO-1.  Federal contractors with 50-99 employees are still required to file an EEO-1, but are not required to submit the new pay data.  The rule is slated to go into effect on March 31, 2018.

Since the election of President Trump, employers have been watching anxiously to see if the new form and the burdens it places on them will be modified or ideally repealed.  Although employers are not required to submit the new form until March 2018, the addition of compensation information has dramatically increased the complexity of preparing EEO-1 submissions.  As a consequence, if the new EEO-1 form is to remain in effect, employers should start preparing for this new requirement immediately (if they have not already begun).

Efforts have been underway to rescind the new EEO-1 form – including efforts in Congress.  The Chamber of Commerce requested that the Office of Management and Budget (“OMB”) rescind the new form because it violates the Paperwork Reduction Act (“PRA”), arguing that the EEOC’s revised EEO-1 does not “(1) minimize the burden on those required to comply with government requests; (2) maximize the utility of the information being sought; and/or (3) ensure that the information provided is subject to appropriate confidentiality and privacy protections” as required by the PRA.

On August 3, 2017, Acting Chair of the Equal Employment Opportunity Commission (“EEOC”), Victoria Lipnic, speaking at the Industry National Liaison Group’s Annual Conference in San Antonio, Texas, discussed the fate of the revised Form EEO-1.  Speech provided new information about the EEO-1 and her efforts to have the revised form rescinded.

Chair Lipnic noted that the Office of Information and Regulatory Affairs (“OIRA”), which is housed within the OMB, would be the entity deciding Chamber of Commerce’s challenge.  Chair Lipnic informed the gathering that the Administrator of OIRA, Neomi Rao, had only recently been confirmed to the post, but that she (Chair Lipnic) had already reached out to discuss the issues raised by the new EEO-1 form.

Chair Lipnic shared that she has sent Administrator Rao a memorandum, asking OIRA to decide by the end of this month (August 2017) whether to implement or discard the wage data collection portion of the revised EEO-1.  Recognizing the burden posed by the new compensation data requirements, Chair Lipnic expressed that it was important to provide employers with information about the fate of the revised EEO-1 sooner rather than later, so employers can prepare to comply.  In Chair Lipnic’s words, “time is of the essence.”

This post was written by Connie N Bertram Guy Brenner and Alex C Weinstein of Proskauer Rose LLP.
Read more legal analysis at the National Law Review.

Business and Employee Groups Oppose Merger of OFCCP with EEOC

President Trump’s 2018 budget, released on May 23, proposes to merge the Office of Federal Contract Compliance Programs (OFCCP) with the Equal Employment Opportunity Commission (EEOC) by the end of FY 2018.  The proposed merger purports to result in “one agency to combat employment discrimination.”  The Trump administration asserts that the merger would “reduce operational redundancies, promote efficiencies, improve services to citizens, and strengthen civil rights enforcement.”

Both business groups and employee civil rights organizations have opposed the measure, albeit for different reasons.  The OFCCP is a division of the U.S. Department of Labor, while the EEOC is an independent federal agency.  Although both deal with issues of employment discrimination, their mandates, functions and focus are different.  The OFCCP’s function is to ensure that federal government contractors take affirmative action to avoid discrimination on the basis of race, color, religion, sex, national origin, disability and protected veteran status.  The OFCCP, which was created in 1978, enforces Executive Order 11246, as amended, the Rehabilitation Act of 1973, as amended, and the Veterans’ Readjustment Assistance Act of 1975.  The EEOC administers and enforces several federal employment discrimination laws prohibiting discrimination on the basis of race, national origin, religion, sex, age, disability, gender identity, genetic information, and retaliation for complaining or supporting a claim of discrimination.  Its function is to investigation individual charges of discrimination brought by private and public sector employees against their employers.  The EEOC was established in 1965, following the enactment of Title VII of the Civil Rights Act of 1964.

Business groups oppose the OFCCP’s merger into the EEOC due to concerns that it would create a more powerful EEOC with greater enforcement powers.  For example, the OFCCP conducts audits, which compile substantial data on government contractors’ workforces, while the EEOC possesses the power to subpoena employer records.  Combining these tools could provide the “new” EEOC with substantially greater enforcement power.  Civil rights and employee organizations oppose the merger, believing that overall it would result in less funding for the combined functions currently performed by each agency.

The budget proposal is consistent with the Trump administration’s goal to reduce costs and redundancies through a reorganization of governmental functions and elimination of executive branch agencies.  In light of opposition from both employers and employees, however, the measure lacks a powerful proponent; as a result, it is unlikely that the administration will succeed in effecting a combination, at least as it is currently proposed.

This post was written by Salvatore G. Gangemi of Murtha Cullina.

EEOC Orientation-Bias Guidance Stirs Controversy among Commentators

EEOC Supreme CourtThe public comment period for the U.S. Equal Employment Opportunity Commission’s (EEOC) proposed workplace harassment guidance closed last week. The EEOC’s broad definition of sexual orientation bias drew attention from practitioners and advocacy groups alike. Amidst the uncertain legal landscape surrounding harassment based on sex, the EEOC’s proposed guidance takes a progressive stance on the scope of what constitutes sex-based harassment. Under the proposed guidance, the EEOC’s definition of harassment based on sex, protected by Title VII, includes an “individual’s transgender status or the individual’s intent to transition,” “gender identity,” and “sexual orientation.” The guidance went further, stating that “using a name or pronoun inconsistent with the individual’s gender identity in a persistent or offensive manner” is sex-based harassment.

The proposed guidance follows a June 2016 report issued by the EEOC’s Task Force on Workplace Harassment, describing strategies to prevent harassment at work. According to the report, almost one-third of claims filed with the EEOC are harassment-based, with sexual harassment constituting over 40% of the claims in the private sector. Issued this past January, the EEOC’s proposed guidance’s purpose is to guide practitioners, employers, and employees alike on the agency’s position toward different types of harassment protected by Title VII. The new guidance updates nearly three-decades-old EEOC direction on workplace harassment and expands the scope of harassment in several areas, including sexual orientation and gender identity. The public comment period, which ended this past week, drew 154 comments. The wide array of those comments highlights the controversial nature of what is and is not be protected under Title VII when it comes to sex-based harassment.

Most critics of the proposed guidance called the EEOC’s definition of sex-based harassment premature and unsupported by case law. Three federal appellate courts are currently deciding cases based on whether sexual orientation is protected under Title VII, but no appellate court to date has found that it is indeed protected. Opponents of the guidance argued that, without certainty at the Congressional or Supreme Court level, the EEOC is improperly “legislating from below” and is in danger of diminishing its credibility.

On the other hand, supporters of the guidance commended the EEOC for its broad definition of sex-based harassment, and some even urged the EEOC to further broaden the definition to include those who do not identify with the gender binary or who are unable or choose not to transition fully. There was also some concern among proponents that the current phrase “intent to transition” would encourage the court to draft intent-based tests that would exclude certain individuals from protection under Title VII.

Commentators took particular notice of the improper pronoun usage example, which states that using a pronoun inconsistent with an individual’s gender can constitute Title VII-prohibited harassment. Some criticized this as an improper classification of hate speech that went beyond the scope of Title VII protection. Others lobbied for an adjustment period for employees and employers to adopt the new standard or, alternatively, add an intent element to the act. Proponents applauded the example’s inclusion as a type of harassment often experienced by employees.

As the government agencies and courts grapple with what is protected under Title VII, it would be prudent for all employers (including those who are not in states or localities that have explicitly broadened these protections) to include both sexual orientation and gender identity in their policies and trainings. The EEOC’s guidance may signal what is to come in the ever-changing area of sex-based harassment as courts and agencies trend toward a more inclusive definition of sex-based harassment. In addition to the possible legal ramifications, getting ahead of the curve and creating a harassment-free workplace promotes a healthier and happier work environment for all and, in the end, makes good business sense.

Wal-Mart to Pay $75,000 to Settle EEOC Disability Lawsuit

EEOC Wal-mart disability discriminationCHICAGO – Wal-Mart Stores Inc. will pay a former employee $75,000 to settle a disability discrimination lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC), the federal agency announced yesterday.

EEOC’s lawsuit charged Wal-Mart with violating federal discrimination law when the giant retailer failed to accommodate Nancy Stack, a cancer survivor with physical limitations, and subjected her to harassment based on her disability. Stack worked at a Walmart store in Hodgkins, Ill.

As a workplace accommodation, Stack needed a chair and a modified schedule. EEOC alleged that while the store provided Stack with a modified schedule for a period of time, it revoked the accommodation for no stated reason. Further, according to EEOC, the store did not ensure that a chair was in Stack’s work area, telling her that she had to haul a chair from the furniture department to her work area, a task that was difficult, given her disability. Making matters even worse, EEOC alleged that a co-worker harassed Stack by calling her “cripple” and “chemo brain.”

Wal-Mart’s alleged conduct violates the Americans with Disabilities Act (ADA), which prohibits discrimination on the basis of disability, which can include denying reasonable accommodations to employees with disabilities and subjecting them to a hostile work environment. EEOC filed suit in U.S. District Court for the Northern District of Illinois, Eastern Division (Equal Employment Opportunity Commission v. Wal-Mart Stores, Inc.; Civil Action No. 15-cv-5796.)

Wal-Mart will pay $75,000 in monetary relief to Stack as part of a consent decree settling the suit, signed by U.S. District Judge Sharon Coleman on Dec. 6th. The two-year decree also provides additional, non-monetary relief intended to improve the Hodgkins store’s workplace. Under the decree, the store will train employees on disability discrimination and requests for reasonable accommodations under the ADA. The Walmart store will also monitor requests for accommodation and complaints of disability discrimination and report those to EEOC.

“Wal-Mart refused to provide simple, effective and inexpensive accommodations in the form of a chair and modified schedule and failed to protect Stack from mocking because she had cancer,” said John Hendrickson, regional attorney of EEOC’s Chicago District Office. “Both the failure to provide accommodations and to stop the harassment violated federal law, and we are pleased with today’s settlement. Ms. Stack will receive monetary recompense from Wal-Mart, and the company will be required to educate its workforce on employees’ rights and on its own obligations under the law.”

You can review this press release in its entirety on the EEOC website here.

EEOC’s Chicago District Office is responsible for processing charges of employment discrimination, administrative enforcement, and the conduct of agency litigation in Illinois, Wisconsin, Minnesota, Iowa and North and South Dakota, with Area Offices in Milwaukee and Minneapolis.

ARTICLE BY U.S. Equal Employment Opportunity Commission
© Copyright U.S. Equal Employment Opportunity Commission

EEOC Issues Guidance on National Origin Discrimination that Applies to Foreign National Employees

EEOC, National Origin DiscriminationThis week the Equal Employment Opportunity Commission (“EEOC”) released guidance regarding national origin discrimination under Title VII of the Civil Rights Act of 1964 (Title VII).  The guidance replaces Section 13 of the EEOC’s compliance manual, with a view toward further defining “national origin” and helping employers and employees understand their legal rights and responsibilities. The guidance specifically states that Title VII applies to any worker employed in the United States by a covered employer (employer with more than four employees), regardless of immigration status, as well as any foreign national outside the United States when they apply for U.S.-based employment.

The new guidance defines “national origin” as an individual’s, or his or her ancestors’, place of origin, which can be a country (including the United States), a former country, or a geographic region.  In addition, “national origin” refers to an individual’s national origin group or ethnic group, which it defines as “a group of people sharing a common language, culture, ancestry, race, and/or other social characteristics.”  Discrimination based on national origin group includes discrimination because of a person’s ethnicity (e.g., Hispanic) or physical, linguistic, or cultural traits (e.g., accent or style of dress).  Discrimination based on place of origin or national origin group includes discrimination involving a mere perception of where a person is from (e.g., Middle Eastern or Arab), association with someone of a particular national origin, or citizenship status.  Title VII discrimination can take the form of unfavorable employment decisions based on national origin or harassment so pervasive or severe that it creates a hostile work environment.

In addition to clarifying the meaning of “national origin,” the guidance provides examples based on how actual courts have applied Title VII to specific facts.  For example, the guidance gives as an example of “intersectional” discrimination a Mexican-American woman who, without explanation, was denied a promotion at a company where she successfully worked for 10 years, despite two non-Mexican women and a Mexican man being selected for the same position.  The guidance also provides examples where national origin discrimination overlaps with other protected bases, such as discriminating against people with origins in the Middle East due to a perception that they follow certain religious practices.  Further, the guidance gives examples of real cases where employment decisions and harassment constituted Title VII national origin violations, as well as cases where Title VII violations were not found.  Finally, the guidance applies Title VII national origin principles to trafficking cases, where employers use force, fraud, or coercion to compel labor or exploit workers, and such conduct is directed at an individual or a group of individuals based on national origin.

Employers of foreign national workers should note that individuals with Title VII claims may also have claims under other Federal statutes, including the anti-discrimination provision of the Immigration and Nationality Act (INA).  Form I-9 and the E-Verify program are two areas where discrimination claims could arise under both the INA and Title VII.

©2016 Greenberg Traurig, LLP. All rights reserved.

Final Rules Released for Federal Contractor Paid Sick Leave and New EEO-1 Report

EEOC EEO-1 reportThursday was a busy day, with the announcement of two long-awaited final rules from the EEOC and the US Department of Labor (“DOL”). The EEOC released the final version of the revised EEO-1 form, and the DOL released the final paid sick leave rule for federal contractors. (And, as we reported yesterday, the US House of Representatives also passed a bill earlier this week that would delay implementation of the Department of Labor’s new overtime rule.)

EEO-1 Pay Data Rule

Following a revised proposal in July, the EEOC has announced the final revised version of the EEO-1 form, which will require employers to report employee pay data beginning with the 2017 report. The 2017 report will be the first to include the new information. The deadline to file the 2017 report is March 31, 2018, giving employers six additional months to prepare their report. The report for 2016 (which is not affected by this new rule) is still due today, September 30, 2016.

Paid Sick Leave

Not to be left out, the DOL also announced the final regulation on paid sick leave for federal contractors. The rule was first announced in President Obama’s September 2015 executive order and proposed rules were announced in February 2016. The final rule will go into effect for new solicitations issued on or after January 1, 2017, and will require employers to provide one hour of paid sick leave for every 30 hours of work, up to a total of 56 hours of paid sick leave per year. The rule will apply to employees of covered federal contractors who work “on” or “in connection with” a covered government contract.

© Copyright 2016 Squire Patton Boggs (US) LLP

New EEOC Hours Reporting Requirements

EEOC Hours Reporting RequirementsAs you may have heard, the Equal Employment Opportunity Commission (“EEOC”) released revised EEO-1 reporting guidelines on July 13, 2016 (for an overview of the new guidance in its entirety, see EEOC Issues Revised EEO-1 Proposal). These new guidelines apply to employers with 100 or more employees and require them to report, among other things, hours worked by exempt and non-exempt employees, subdivided by gender, race, ethnicity, job classification, and pay band.  For an example of the proposed new reporting form, click here. Although employers and other members of the public will have until August 15, 2016 to comment on the revised proposal, it is unlikely that any further substantive revisions will be made. Currently, it appears that employers will be required to submit the new EEO-1 form on March 31, 2018, giving them approximately a year and a half to prepare their recordkeeping systems to capture the newly required data.  Therefore, employers are advised to review, and update if necessary, internal recordkeeping systems to be prepared to report hours worked, and pay data, for calendar year 2017 when filing the EEO-1 on March 31, 2018.

What Are “Hours Worked” And Why Does The EEOC Want Them?

In response to employer requests for guidance concerning the definition of “hours worked,” the EEOC has specified that, for employees covered by the Fair Labor Standards Act (“FLSA”), their hours should be recorded as follows:

Non-exempt Employees: The EEOC should report “hours worked” as defined by the FLSA.  “Hours worked” includes time when the employee is actually working (either at the employer’s premises or remotely).  Therefore, “hours worked” would not include meal time, vacation, PTO or other leave, even if the non-exempt employee is paid for that time off, and even though the compensation for those hours will be reflected in the W2 data provided on the EE0-1 form.

Exempt Employees. Employers have two options: (1) provide the actual hours of work of exempt employees if the employer already maintains accurate records of this information, or (2) report a proxy of 40 hours per week for full time exempt employees and 20 hours per week for part-time exempt employees, multiplied by the number of weeks the individuals were employed during the reporting year.

The EEOC provides a few reasons for requiring disclosure of hours worked. First, if the EEOC discovers a pay disparity, it intends to use this information to it assess whether a disparity is caused by the part-time or full-time status of the respective employees, rather than by gender, race, or ethnicity.  Second, the EEOC intends to use the hours worked data to assess whether employees in protected classes are subject to discrimination in terms of hours instead of pay, with an employer habitually assigning more hours and overtime to some employees while denying it to others.

Next Steps For Employers

Employers are well-served to apply the same analysis that the EEOC intends to use while doing internal audits to determine if there are statistical concerns, and the reasons behind the patterns.  The employer can then consider if actions are warranted now to remediate any issues before 2017, or, be able to explain the legitimate business reasons for any disparities if called upon to defend pay practices.

Employers should also audit time-keeping protocols and policies to be sure that non-exempt employees are accurately recording “hours worked”.  Employers should also confirm that their HRIS systems can run reports of hours worked, that do not include paid timeEEOC Hours Reporting Requirements off.  Additionally, if employers intend to report actual hours worked for exempt employees, rather than the 40 hour proxy for full time employees, then the same recommendations apply.

©2016 Drinker Biddle & Reath LLP. All Rights Reserved