Hot Topics in Total Rewards

  • 02 Dec 2021 11:44 AM | Bill Brewer (Administrator)

    The big-ticket question: Can (or should) employers require the COVID-19 vaccine of employees in the workplace? | 2021-05-12 | ISHN

    BY AIMEE PICCHI

    NOVEMBER 30, 2021

    Most large U.S. employers say they now require, or plan to mandate, that their workers get vaccinated against COVID-19, according to a new survey of more than 500 companies by corporate advisory firm Willis Towers Watson. 

    The survey comes as the Biden administration's new rule about workplace vaccinations remains in limbo. Under the regulation, companies with 100 or more employees must require workers to get vaccinated or undergo weekly testing for the disease. 

    Implementation of the emergency standard is currently on hold after a federal appeals court earlier this month reaffirmed an earlier temporary halt on the vaccine rule and ordered the Labor Department's Occupational Safety and Health Administration (OSHA) to stop enforcing or implementing the regulation. 

    The Willis Towers Watson survey sheds light on how large companies are approaching COVID-19 vaccinations amid challenges to the Biden rule, which has been the target of lawsuits from at least 11 states over its constitutionality. Nearly 6 in 10 companies indicated that they either already require COVID-19 shots for employees or plan to implement such a requirement, according to the firm's findings. Yet roughly a third of respondents said they will move forward with a vaccine mandate only if an Ohio district court upholds the OHSA rule.

    Only about 7% of businesses said they plan to require vaccines regardless of what happens with the OSHA rule, while another 18% currently require the shot, the survey found. More than 8 in 10 businesses said they plan to offer regular COVID-19 testing to employees. About 3 in 10 businesses said they don't plan to require vaccinations, while 1 in 10 are undecided, the survey found.

    Despite the uncertainty around the OSHA vaccine rule, legal experts have urged companies to move forward with meeting its requirements. That's partly because businesses may face costly fines if the 490-page regulation goes into effect and they are caught unprepared. Willis Towers Watson said it is also recommending that companies plan on implementing the vaccine rule. 

    "Despite the current holding pattern pending the court rulings, we advise employers to proceed with plans to implement the mandate as well as other efforts to protect their workers," said Dr. Jeff Levin-Scherz, population health leader at Willis Towers Watson, in a statement. 

    The study, which was conducted from November 12 - 18, polled 543 U.S. employers with a combined 5.2 million workers. Each of the employers that participated in the study had more than 100 workers — the group that will be required to adhere to the OSHA rule if it moves forward.

    Some employers have expressed concern that workers who are opposed to the vaccinations may quit if the OHSA rule is enforced. New Hampshire manufacturing owner Kathy Garfield, expressed concern that some vaccine-wary workers may depart for smaller businesses that aren't subject to the same regulation. Garfied called the OSHA rule a "crushing blow to employers." 

    But few employers with vaccine mandates — only 3% — said they had seen a spike in resignations, according to the Willis Watson Towers survey. Even so, one-third of businesses planning mandates told Willis Watson Towers they were worried about the possibility that some employees could leave. 

    About 5% of unvaccinated workers said in a recent survey by the Kaiser Family Foundation that they would quit their job due to a COVID-19 shot requirement by their employer. That group represents just 1% of all U.S. adults, the Kaiser survey noted. 

    Some employers say they see an upside to a vaccination requirement. Almost half of employers surveyed said they believe it could help recruit and retain workers. 

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    Source:  CBS News

    https://www.cbsnews.com/news/covid-vaccine-mandate-big-employers-update/

  • 01 Dec 2021 9:28 AM | Bill Brewer (Administrator)

    New report reveals recruitment and retention as the top upward pressure on 2022 wages


    NEW YORK, Nov. 12, 2021 /PRNewswire/ -- The median projected percentage change for total salary budgets from 2021 to 2022 is an increase of 3.0%, according to XpertHR's 2022 Salary Budget Survey of 429 U.S. employers. This is also the median increase projected for the salary budgets for all three employee groups covered by this survey: exempt, nonexempt, and officers/executives.   

    According to Andrew Hellwege, Surveys Editor, XpertHR, the projected median 3.0% increase in total salary budgets is notable, given a national labor shortage exacerbated by the COVID-19 pandemic.

    The median projected percentage change for total salary budgets from 2021 to 2022 is an increase of 3.0%, according to XpertHR's 2022 Salary Budget Survey.

    The median projected percentage change for total salary budgets from 2021 to 2022 is an increase of 3.0%, according to XpertHR's 2022 Salary Budget Survey.

     "This median projected increase is on par with the actual median increase from 2020 to 2021, indicating that while the nature of work has shifted dramatically in the last two years, planned salary budget increases remain unchanged," he explained. "Forward-looking companies that are eager to overcome the labor shortage may want to consider increasing their projected salary budgets by more than 3.0%, or potentially examine how benefits beyond compensation can contribute to a positive employee experience."

    Additionally, the survey reveals the large role recruitment and retention is playing in employers' plans for next year's wages. When asked if a dozen various factors would exert upward, downward, or no pressure at all on their organization's 2022 total salary budget, nearly eight in 10 (79%) organizations cited recruitment/retention as an upward pressure.

    "Nearly four in five employers noted recruitment and retention as a positive influence on their 2022 total salary budget, which appears to be a clear indication that the labor shortage is top of mind with employers as they plan for next year's wages," says Hellwege.

    Meanwhile, salaries in the industry (73%), inflation/cost of living (69%), the economy (59%), and salaries within the organization (53%) round out the top five upward pressures on 2022 wages.

    XpertHR's Salary Budget Survey 2022 was conducted from Sept. 7 to Oct. 1, 2021. The survey included responses from 429 U.S. employers of various industries and workforce sizes, representing just over 2 million workers. The survey report explores several aspects of the salary budget planning process, including pressures on salary budgets, percentage change of salary budgets from 2021 to 2022, and in what month next year's salary budgets will come into effect. Additionally, this report covers performance metrics for annual salary adjustments, plans for bonuses in 2022, and more.

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    Source: XpertHR 

    https://www.prnewswire.com/news-releases/survey-shows-salary-budgets-will-increase-3-0-in-2022--301423125.html

  • 01 Dec 2021 9:24 AM | Bill Brewer (Administrator)

    42% of Employees Say their Employer Is Not Dedicated to Closing Pay Gaps in New

    Just half of employees believe they are paid equitably

    WALTHAM, Mass., Nov. 2, 2021 /PRNewswire/ -- Forty-two percent of employees do not think their employer is dedicated to closing pay gaps, according to the 2021 Viewpoint: Diversity, Equity & Inclusion, a new survey by Salary.com and the HR.com Research Institute. The research provides insights on views of HR executives vs. those of employees to help understand the state of diversity, equity, and inclusion in the workplace.

    The report also found HR pros and employees are not on the same page when it comes to pay equity: only half of surveyed employees (53%) say they are paid equitably or believe their peers are, while a larger proportion of HR professionals (66%) believe their peers are paid equitably. HR professionals and employees are more aligned when it comes to how leadership prioritizes equitable pay: only 17% and 18%, respectively, say it is a top priority among the executives in their organization.

    "Pay equity is a fundamental element of the employer-employee relationship, yet 42% of employees surveyed say their employer is not dedicated to closing pay gaps," said Lenna Turner, Director of Diversity, Equity and Inclusion and a Compensation Consultant at Salary.com. "At Salary.com, we define pay equity as internally equitable, externally competitive, and transparently communicated. While employers are making progress, a lack of transparent communication could be leading to this employee skepticism when it comes to pay equity."

    Addressing Pay Equity
    HR respondents (57%) suggest they are more likely to report pay equity issues, which is far more than employees (37%). This may be because HR has more access to the training and the workforce data necessary to uncover discrepancies in pay. Further, while HR professionals report pay equity issues more often, employees are more likely to suffer consequences when reporting these issues (44% vs. 17%)

    Budget Breakdown
    Fewer than one-quarter of HR professionals say their organization has a formal budget allocated to closing pay gaps. This lack of budget could be the reason why just 33% of HR professionals agree or strongly agree that their organization has the proper tools to detect internal pay gaps.

    HR professionals who say their organization's pay equity tools successfully detect internal pay gaps and inequity are more likely to:

    • say they themselves and their peers are paid equitably
    • have pay equity among different ethnicities/races
    • make equitable pay a top priority among executives
    • have a formal budget allocated to closing pay gaps
    • have employees speak up if they witness or experience workplace discrimination
    • have DE&I initiatives that are adequately staffed, funded and measured
    • say their organization celebrates diversity

    "In the wake of the pandemic, it's even more critical that management and their employees see eye to eye when it comes to diversity, equity, and inclusion. Employees value these issues immensely but are not seeing their companies do enough work in this area," stated Debbie McGrath, Chief Instigator and CEO of HR.com. "Employers have to understand that equity is critical for business growth!"

    Download the full report which includes details on ten key takeaways to help HR departments gain insights into how to improve diversity and inclusion initiatives to ensure equity in all areas of their workforce management and optimal engagement, productivity, retention, and business results.

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    Source: Salary.com

    https://www.prnewswire.com/news-releases/42-of-employees-say-their-employer-is-not-dedicated-to-closing-pay-gaps-in-new-pay-equity-research-by-salarycom-and-the-hr-research-institute-301413596.html

  • 15 Nov 2021 11:38 AM | Bill Brewer (Administrator)

    Souped-up 401(k) leads KPMG's efforts to hire and keep workers | Fox Business

    KPMG replaces 401(k) match with a single, automatic firm-funded contribution

    By Suzanne O'Halloran 

    Accounting giant KPMG is aiming to stay one step ahead of the drum-tight job market by rewarding current employees and hopefully luring new ones with enhanced benefits including a modern-day 401(k) plan.

    In what is believed to be the first, the firm will replace the traditional match with an automatic funded contribution that is equal to as much as 8% of an employee’s salary.

    "You used to have to put a matching contribution into your own 401(k), and you can still contribute to your own 401(k) as you are permitted by law, but you no longer have to put a matching contribution. Instead we’re going to make an automatic contribution on your behalf that you will be able to enjoy in the future," KPMG CEO Paul Knopp told FOX Business. "We’re giving our employees more flexibility, more security for their financial future and a lot more ability to spend time with their families" for key life events.

    Other benefits recently upgraded include cutting employee health care premiums by 10% in 2022, while keeping benefits the same, and three weeks of additional paid caregiver leave, separate from paid time off, to name a few. 

    KPMG, like many other companies, is finding it challenging to hire workers with job openings at near-record levels. 

    On Friday, the U.S. economy reported it added 531,000 workers last month, up from 194,000 in September. While hiring is improving, there are still a near-record 10.4 million job openings. 

    "We are really trying to hire right now. We are hiring in record numbers" Knopp added, citing digital businesses, including cyber, audit and tax. 

    The firm, which has 35,000 U.S. employees, is aiming to hire 2,500 experienced professionals, 1,300 full-time campus hires and 1,200 interns domestically. 

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    Source: FOXBusiness

    https://www.foxbusiness.com/markets/401k-match-kpmg-taxes-benefits-jobs-hire-workers

  • 15 Nov 2021 11:33 AM | Bill Brewer (Administrator)

    picture of two envelopes saying "good news" and "bad news"

    Workers will be happy to know that they can contribute more to their 401(k) accounts next year, but IRA owners may be a little disappointed.

    by: Rocky Mengle  |  November 4, 2021 

    There's good news and bad news from the IRS for Americans saving for retirement with IRAs, 401(k)s, and other retirement accounts in 2022.

    Let's start with the bad news: IRA Contribution limits won't go up next year. For anyone saving for retirement with a traditional or Roth IRA, the 2022 limit on annual contributions to their account remains unchanged at $6,000. It's been stuck at this same amount since 2019. The additional IRA "catch-up" contribution for people 50 and over is not subject to an annual cost-of-living adjustment and stays at $1,000, too.

    And now the good news: Workers who are saving for retirement with 401(k), 403(b), most 457 plans, and the federal government's Thrift Savings Plan can contribute up to $20,500 to those plans in 2022. That's a $1,000 increase over the contribution limits in place for 2020 and 2021. The "catch-up" contribution limit for employees age 50 or older who participate in these plans holds steady in 2022 at $6,500, though.

    The contribution limit for a SIMPLE IRA, which is a retirement plan designed for small businesses with 100 or fewer employees, is also increased for 2022. It jumps from $13,500 to $14,000 next year. But, as with 401(k) plans, the catch-up contribution limit for workers at least 50 years old who participate in a SIMPLE plan stays put at $3,000.

    Income Ranges for 2022

    There's more good news! Increased income ranges for the traditional IRA deduction, Roth IRA contributions, and the Saver's Credit means more Americans will qualify for these tax breaks.

    If you're contributing to a traditional IRA, the deduction allowed for your contribution is gradually phased-out if your income is above a certain amount. For 2022, the phase-out ranges are:
    • $68,000 to $78,000 for a single person covered by a workplace retirement plan (up from $66,000 to $76,000 in 2021);
    • $109,000 to $129,000 for a married couple filing jointly if the spouse making the IRA contribution is covered by a workplace retirement plan (up from $105,000 to $125,000 in 2021);
    • $204,000 and $214,000 for a married couple if the spouse contributing to an IRA is not covered by a workplace retirement plan and the other spouse is covered (up from $198,000 and $208,000 in 2021); and
    • $0 to $10,000 for a married person filing a separate return who is covered by a workplace retirement plan (the same as 2021 because this range is not subject to an annual cost-of-living adjustment).

    For people saving for retirement with a Roth IRA, the actual amount that you can contribute to the account is based on your income. To be eligible to contribute the maximum for 2022, your modified adjusted gross income must be less than $129,000 if single or $204,000 if married and filing jointly (up from $125,000 and $198,000, respectively, for 2021). Contributions begin to be phased out above those amounts, and you won't be able to put any money into a Roth IRA in 2022 once your income reaches $144,000 if single or $214,000 if married and filing jointly ($140,000 and $208,000 for 2021). The phase-out range for a married person filing a separate return who contributes to a Roth IRA is not adjusted annual for inflation and remains $0 to $10,000 for 2022.

    Finally, the 2022 income limit for the Saver's Credit for low- and middle-income workers is $68,000 for joint filers ($66,000 in 2021), $51,000 for head-of-household filers ($49,500 in 2021), and $34,000 for singles filers and married people filing a separate tax return ($33,000 in 2021).

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    Source: Kiplinger 

    https://www.kiplinger.com/retirement/retirement-plans/603711/2022-ira-and-401k-contribution-limits 

  • 28 Oct 2021 12:21 PM | Bill Brewer (Administrator)

    Published Oct. 19, 2021 | Zachary Phillips

    Workers brought a class action suit against one of Pennsylvania's largest road builders after the contractor pleaded no contest to charges from the state attorney general.

    The legal battles continue for Glenn O. Hawbaker.

    For the second time in six months, the Pennsylvania road builder faces litigation, this time in a class action lawsuit.

    In addition, the state DOT is pushing for Hawbaker to be suspended from public work for three years, the AP reported. The case has been delayed after a court ruled to give Hawbaker more time to build a legal response, reported WJAC 6, a local NBC affiliate. Hawbaker received estimated payments worth $1.7 billion from the state as of 2021, making it one of the largest public works contractors in Pennsylvania. 

    In a lawsuit filed last week, three employees of the contractor accused Hawbaker of violating the Employee Retirement Income Security Act. Instead of placing the prevailing wage workers' retirement funds into the 401(k) account of those who earned it, Hawbaker used the funds to pay for all employee, executive and owner retirement savings, attorney Mike Donavan wrote in the lawsuit, according to the Centre Daily Times.

    This resulted in prevailing wage workers being short-changed in their profit-sharing and retirement saving accounts.

    The lawsuit follows on the heels of allegations made in April by Pennsylvania Attorney General Josh Shapiro, who charged Hawbaker with stealing $20 million from employees in the largest wage theft case on record. 

    After a three-year investigation, Hawbaker was charged with four counts of theft relating to violations of the Pennsylvania Prevailing Wage Act and the federal Davis-Bacon Act. Investigators reviewed Hawbaker's accounting records and found that, between 2015 and 2018, the contractor stole nearly $20.7 million of prevailing wage workers' fringe benefit money.

    As a contractor receiving large amounts of funding from the state and federal governments, Hawbaker must pay wage rates determined by government agencies — though a portion of those wages can be provided via fringe benefits.

    Same issue, new case

    Hawbaker stole wages, according to investigators, by using money marked for just prevailing wage workers' retirement funds and health and welfare benefits to contribute to all workers retirement funds — including owners and executives — and subsidize the cost of a self-funded health insurance plan to cover all employees. 

    In August, Hawbaker pleaded no contest — meaning the defendant does not plead guilty, but accepts conviction or sentencing as though it did — and agreed to pay more than $20 million to nearly 1,300 workers in restitution. Additionally, the company faces five years of probation, and must have a corporate monitor of their practices.

    While the attorney general's investigation determined that the contractor's scheme had lasted decades, it could only be charged for the last five years due to the statute of limitations.

    With this more recent case by previous employees, Hawbaker could be liable for practices as far back as September 2012. As with the no contest plea, Hawbaker has denied wrongdoing, claiming that state and federal regulators had reviewed its practices for years.

    "Throughout this process, Hawbaker has fully cooperated because we always believed we were following all laws," Hawbaker said in a statement shared with Construction Dive. "We will vigorously defend any of these allegations."

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    Source: HR Dive

    https://www.hrdive.com/news/glenn-hawbaker-faces-lawsuit-employee-wage-violations-theft-Pennsylvania/608825/

  • 22 Oct 2021 12:02 PM | Bill Brewer (Administrator)


    The Amazon headquarters sits virtually empty on March 10, 2020 in downtown Seattle, Washington. In response to the coronavirus outbreak, Amazon recommended all employees in its Seattle office to work from home, leaving much of downtown nearly void of people.

    PUBLISHED MON, OCT 11 2021 .... Annie Palmer

    Amazon is giving its employees more flexibility to work from home even after its offices begin to reopen next year.

    In a memo to employees Monday, Amazon CEO Andy Jassy said the company will leave it up to individual team directors to decide how often their employees work in the office.

    “We expect that there will be teams that continue working mostly remotely, others that will work some combination of remotely and in the office, and still others that will decide customers are best served having the team work mostly in the office,” Jassy wrote. “We’re intentionally not prescribing how many days or which days — this is for Directors to determine with their senior leaders and teams.”

    Amazon declined to say how many people it employs at the director level.

    The move marks a shift from Amazon’s earlier return-to-work plans, which said it expected most corporate employees to return to the office beginning Jan. 3, 2022. Amazon had set a baseline of three days a week in the office, leaving employees the option to work remotely up to two days a week.

    Jassy said Amazon found it couldn’t prescribe a “one-size-fits-all approach” to work at the company’s scale. Amazon now has 1.3 million employees worldwide, with hundreds of thousands of those in corporate roles.

    As part of the policy change, Amazon will also give corporate employees the option to work up to four weeks per year fully remotely from any location within the country they’re employed.

    While Amazon is giving employees greater leeway on reporting to the office, Jassy said most employees will be expected to remain close enough to their team “that they can easily travel to the office for a meeting within a day’s notice.”

    Other tech giants have also embraced remote work. Microsoft in September indefinitely postponed its return to the office, while Facebook and Google expect a portion of their employees to continue to work from home if their jobs can be done remotely.

    Twitter even told its employees last year they can work from home “forever” if they choose to.

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    Source: CNBC

    https://www.cnbc.com/2021/10/11/amazon-to-let-managers-decide-how-often-employees-come-into-the-office.html

  • 22 Oct 2021 11:54 AM | Bill Brewer (Administrator)

    McDonalds-unit-shot.jpg

    Adjustments in 2022 will result in comparable pay among all company employees

    Bret Thorn | Oct 19, 2021

    McDonald’s has essentially achieved equal pay for women and other historically underrepresented groups across company-owned restaurant and corporate employees in the United States, the company announced Tuesday.

    Chicago-based McDonald’s said it employs more than 180,000 people, that employees of all genders now receive equal pay for comparable work at all company-owned restaurants, and that women are paid 99.16% of men for comparable work among corporate staff in the United States. Globally that figure is 99.85%.

    A McDonald’s representative said the U.S. figure would reach 100% once adjustments are made during next year’s “compensation cycle.”

    That announcement came after working with pay analysis expert Mercer to conduct a study of corporate staff and company-owned restaurants globally.

    Around 7% of McDonald’s approximately 39,000 locations worldwide are company-owned, the representative said.

    The announcement was made in a letter to the global McDonald’s system from global chief people officer Heidi Capozzi.

    “Making McDonald’s an inclusive brand is a core value because it isn’t just the responsibility of one person or one team. It depends on all of us,” Capozzi said. “Over the past 18 months, we’ve worked together to create a future where equality, fairness and opportunity aren’t just goals, but the lived experience of every single person in our communities.”

    Earlier this year, McDonald’s said it was tying senior leader compensation in part to goals it set for developing a more diverse leadership team. Those goals include having 35% of positions of senior director and above filled by people of underrepresented groups, such as women and people of color, by 2025. It set a goal of having at least 45% of those roles filled by women by 2025 and 50% by 2030.

    McDonald’s said it would continue to conduct a global pay analysis annually.

    “We recognize that to realize our aspiration [of equal pay] we must also keep actively attacking the systemic biases that negatively impact women and people with other marginalized identities,” Capozzi said in the letter. “We’ll do this by continuing to hire, promote, and retain diverse, world-class talent; by offering the most competitive learning and development programming among our peers; and by creating formal mentoring and sponsorship programs to accelerate success in our workforce. McDonald’s has also joined the Catalyst Gender and Diversity KPI Alliance, a group of DEI advocates, corporations, academics, and trade organizations that support the adoption and use of a set of key performance indicators to measure gender and diversity in their organizations.”

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    Source: Nation's Restaurant News 

    https://www.nrn.com/quick-service/mcdonald-s-achieves-equal-pay-women-and-other-underrepresented-groups-corporate

  • 15 Sep 2021 8:23 AM | Bill Brewer (Administrator)

    Welcome to OFCCP! | Broadbean US

    On September 1, 2021, the Office of Federal Contract Compliance Programs (OFCCP), the Department of Labor sub-agency charged with enforcing affirmative action and non-discrimination requirements imposed on federal contractors by way of Executive Order 11246, announced that it was reversing its prior position regarding the use of EEO-1 compensation data collected by the Equal Employment Opportunity Commission for calendar years 2018 and 2019 (the so-called “Component 2”).1

    Specifically, OFCCP announced that effective immediately, it is rescinding its prior policy under which the agency would not “request, accept, or use EEO-1 Component 2 data.”  The prior policy was based on OFCCP’s belief that it would not find significant utility in the data, “given limited resources and [the data’s] aggregated nature.”  

    Reversing course, OFCCP now indicates that it has determined that the prior non-use policy was “premature and counter to the agency’s interests in ensuring pay equity.” The agency claims that its prior decision to not use Component 2 data was premature because, at that time, OFCCP had little information about the response rate of the collection, how the data was submitted and assembled, or the completeness of the data. Nor did the agency have the opportunity to review and analyze the data.

    OFCCP’s announcement states that it will use information gathered in the prior Component 2 data collection to assess its utility for providing insight into pay disparities across industries and occupations, with the stated purpose of “strengthening Federal efforts to combat pay discrimination.”  Specifically, the agency indicates that it will evaluate the data’s utility, “because the joint collection and analysis of compensation data could improve OFCCP’s ability to efficiently and effectively investigate potential pay discrimination.”  OFCCP’s position is that compensation data, in conjunction with other available information, such as labor market survey data, could help OFCCP identify neutral criteria to select contractors for compliance evaluations.

    Given the aggregated nature of the data, it is likely to be of limited use in proving pay discrimination, which usually involves a very close examination of the work and compensation of a specific individual vis-à-vis others.  That said, OFCCP’s 180-degree turn provides yet another example of the aggressive stance the Biden administration has taken (and is expected to continue to take) with respect to issues of pay equity, and its willingness to use the carrot of federal contracting to regulate private-sector employers that do business with the federal government.

    Possibly the most significant consequence of this decision is that it may have the potential to expose contractor pay data to public disclosure through FOIA requests.  While an individual employer’s Component 2 data that has been provided to the EEOC is clearly protected from further disclosure by the EEOC, the FOIA protections that apply to EEO-1 data that is in OFCCP’s possession has been a subject of prior litigation.  

    Littler’s WPI will apprise of relevant developments as they occur.

     

    Footnotes

    1 By way of background, in 2016 the EEOC published a final rule requiring employers to report certain compensation data of their workforce sorted by race, sex, ethnicity, salary range, and job category.  In 2017, the agency announced that it was suspending this effort and would not move forward with this collection.  Ultimately, a federal district court ruled that the agency’s suspension of the collection was unlawful, and required the EEOC to collect pay data for calendar years 2018 and 2019.  That collection was completed in early 2020.

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    Source: JD Supra

    https://www.jdsupra.com/legalnews/ofccp-reverses-course-will-use-eeo-1-8971089/

  • 14 Sep 2021 11:06 AM | Bill Brewer (Administrator)

    Published Sept. 14, 2021 by Ryan Golden 

    Dive Brief:

    • The U.S. Department of Labor's Office of Federal Contract Compliance Programs rescinded Sept. 2 a Trump administration notice that it did not intend to request, accept or utilize pay data collected under Component 2 of EEO-1 forms.
    • In November 2019, OFCCP announced that it would not request, accept or use Component 2 data collected as part of EEO-1 forms for the 2017 and 2018 calendar years. In its Sept. 2 update, however, OFCCP did note that it had "previously expressed interest" in collecting summary compensation data ultimately by collaborating with the U.S. Equal Employment Opportunity Commission as part of the EEO-1 filing process.
    • "Upon further consideration, OFCCP believes the position taken by the agency in the November 2019 notice was premature and counter to the agency's interests in ensuring pay equity," the agency said. OFCCP added it plans to examine Component 2 data because analyzing that data, in conjunction with other inputs, "could help OFCCP identify neutral criteria to select contractors for compliance evaluations."

    Dive Insight:

    The change is, in part, a reflection of the differing views of the OFCCP under the Trump and Biden administrations, respectively. In 2019, the agency disputed whether pay data collected via Component 2 would be useful; it said the data was collected in a "highly aggregated format" that "is not collected at a level of detail that would enable OFCCP to make comparisons among similarly situated employees as required by the Title VII standards that OFCCP applies in administering and enforcing Executive Order 11246."

    OFCCP's reversal also has to be understood within the context of EEO-1 Component 2, an initiative that has experienced its own share of see-saw activity during the past four years. After a lengthy series of court battles required EEOC to institute pay data collection for 2017 and 2018, the agency ultimately declined to renew Component 2 for future years. 

    Under recently appointed Chair Charlotte Burrows, however, EEOC has indicated it will continue to pursue methods for examining pay equity in U.S companies. The agency last year announced it was considering a rulemaking to include a new pay data reporting requirement to be published by October 2021. Per its filing with the Office of Information and Regulatory Affairs, that effort is still in the prerule stage.

    Both Burrows and the Biden administration at large have said they aim to address pay equity in the future. In 2019, while a commissioner at EEOC, Burrows told an audience during a conference session that she felt EEO-1 Component 2 was "very useful" to EEOC. But the Commission's majority-Republican composition may oppose efforts to reinstate the requirement. Former chair and current commissioner Janet Dhillon, a Trump administration appointee, previously expressed concerns about Component 2.

    EEOC's first pay data report, based on 2017 and 2018 Component 2 data, is scheduled to be published on Dec. 31, 2021, according to an agency announcement in July 2020.

    Meanwhile, employers also may need to pay attention to state and local developments on pay data collection. California instituted a pay data reporting requirement for all employers in the state that are required to file EEO-1 reports. California employers were required to report pay data to the state's Department of Fair Employment and Housing by March 31.

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    Source: HR Dive

    https://www.hrdive.com/news/ofccp-reopens-door-to-request-employers-reported-pay-data/606556/

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