September 2, 2021

The Office of Federal Contract Compliance Programs (OFFCP) has published a notice in today’s Federal Register to announce that it is rescinding its previously issued notice from November 25, 2019, and will now use EEO-1 pay data to investigate pay discrimination in federal contracting. In the 2019 notice, OFCCP stated that it did not intend to request, accept, or use EEO-1 Component 2 data because OFCCP did not “expect to find significant utility in the data given limited resources and [the data’s] aggregated nature.” Component 2, under which employers must submit data regarding employee W-2 data and hours worked, was first introduced in 2016. In today’s announcement, OFCCP states that it will now 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” and identifying neutral criteria to select contractors for compliance evaluations. 

OFCCP administers and enforces Executive Order 11246, which applies to federal contractors and subcontractors and: (1) prohibits employment discrimination and requires affirmative action to ensure equal employment opportunity regardless of race, color, religion, sex, sexual orientation, gender identity, or national origin; and (2) prohibits federal contractors and subcontractors from discriminating against applicants and employees for asking about, discussing, or sharing information about their pay or the pay of their co-workers, subject to certain limitations. The OFCCP notes that information on the EEO-1 is shared between the Equal Employment Opportunity Commission (EEOC) and the OFCCP to avoid duplicative information collections and minimize the burden on employers. Per this notice, OFCCP is rescinding its November 25, 2019 notice because it has determined that it was premature to issue a notice stating OFCCP did not expect to find significant utility in the data. OFCCP states that it intends to devote further agency resources to 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. Thus, OFCCP is rescinding its November 25, 2019 notice.

This action is effective immediately.

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