AGC Tells OMB that Proposed EEO-1 Report is Overly Burdensome for Construction Employers

On August 15, AGC submitted a second set of comments to the Office of Management and Budget (OMB) opposing the Equal Employment Opportunity Commission’s (EEOC) proposed rule to revise the Employer Information Report (EEO-1).  The proposal intends to collect compensation and hours-worked data in addition to already collected race and gender data.  AGC submitted comments on the rule, as initially proposed, in April.  A final rule is expected in the Fall.

The proposal to revise the report references wage discrimination as the basis for the need to collect compensation data from employers.  In both comment letters, AGC explains to the EEOC and OMB that the collection of wage data is not necessary.  Specifically, both the EEOC’s and the Office of Federal Contract Compliance Program’s (OFCCP) data show that there is no need for the eradication of wage discrimination in construction because there is scant evidence that such discrimination exists.  Additionally, AGC addresses other reasons why the collection of wage data are unnecessary including explanations that:

  • Better suited tools already exist to assist with compensation benchmarking;
  • National wage data are useless for benchmarking purposes in construction; and
  • Government analysis will not account for a wide variety of factors used to determine compensation.

While AGC’s comments stress that this data collection is not needed, in an effort to mitigate the burdensome impact the proposed changes would have on its members, AGC urged the EEOC to consider the following should the revisions be unnecessarily implemented:

  1. Understand that aggregate data are not useful or transparent, yet transparent data place employers’ proprietary information at risk
  2. Allow the use of W-2 data to make reporting easier for employers
  3. Change the EEO-1 reporting date to allow for post-annual reporting
  4. Clearly define “contractor” on the revised EEO-1 form
  5. Take all measures to ensure confidentiality prior to the release of a revised EEO-1 report

In its final proposed rule submitted to OMB, the EEOC did accept AGC’s recommendation to use W-2 data and change the reporting date from September 30, to a post-annual reporting date of March 31.  However, the agency proposes to use Box 1 data on the W-2 form instead of Box 5 data, which more accurately reflects an employee’s total earnings. As a result, AGC recommended the use of Box 5 data for the collection of compensation data, should the data be unnecessarily required. 

The EEOC also proposed to change the workforce “snapshot” period during which employers much identify the workforce that must be included on the EEO-1 report from the third quarter to the fourth quarter in order to coincide with the new reporting date.  If a snapshot period must be used, since construction work typically peaks during Summer and Fall, AGC recommended a snapshot period during those months for construction employers.

Regarding the collection of hours-worked data, the original proposal did not provide an example of what the collection of information would look like on the revised form.  Therefore, AGC asked the EEOC to withdraw consideration of this requirement until it can provide an example that can be evaluated by employers for public comment.  While the EEOC did not withdraw consideration for reporting hours-worked data, the agency did explain how the data should be collected and reported by employers.  A survey of AGC members reflected that 88% of respondents were concerned that reporting hours-worked data by the EEOC’s recommended “pay-bands” would be burdensome, with nearly 40% stating it would be extremely burdensome – particularly for tracking the hours-worked by non-exempt employees due to the unique transitory and often seasonal nature of the construction industry.

If implemented, the revised report would be required by all employers with 100 or more employees.  Prime and first-tier subcontractors who perform work directly for the federal government and have 50 or more employees would be required to submit the currently used EEO-1 report that does not include compensation and hours-worked data.  Employers with fewer than 100 employees, second-tier and lower federal subcontractors with fewer than 100 employees, all federally-assisted contractors with fewer than 100 employees, and prime and first-tier subcontractors with fewer than 50 employees will not be required to complete either version of the EEO-1 report.

AGC will continue to monitor the developments of the proposal and will keep members informed.  

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