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Changes Coming to Federal Agency Reporting Categories

On March 28, 2024, the White House announced the federal government is making key revisions to the questions agencies use to collect information on race and ethnicity that will have implications for employers as they use these categories for federal reporting compliance and recordkeeping purposes, as well as affirmative action obligations for covered federal contractors and subcontractors. 

The directive’s changes include the following three key aspects: 

  1. Using one combined question for race and ethnicity and encouraging respondents to select as many options as apply to how they identify; 
  2. Adding Middle Eastern or North African as a new reporting category for race and ethnicity. The revised race and ethnicity categories for minimum reporting are:
    • American Indian or Alaska Native 
    • Asian 
    • Black or African American 
    • Hispanic or Latino
    • Middle Eastern or North African 
    • Native Hawaiian or Pacific Islander; and
    • White.
  3. Requiring the collection of additional detail beyond the minimum required race and ethnicity categories for most situations, to ensure further disaggregation in the collection, tabulation, and presentation of data when useful and appropriate. 

The updated standards also include several additional updates to definitions, terminology, and guidance to agencies on the collection and presentation of data. 

Federal agencies have been instructed to comply with the following tasks and timelines: 

  • Start updating surveys and forms as quickly as possible. 
  • Submit a compliance plan within 18 months that will be publicly available. 
  • Ensure all data collections and programs comply with the updated standards within five (5) years. 

Although the agencies have some time to comply with the updated standards, the White House noted that many programs will be able to adopt these standards much sooner. 

Next Steps 

Employers should await further guidance from applicable federal agencies, such as the Equal Employment Opportunity Commission (EEOC) and Office of Federal Contract Compliance Programs (OFCCP), to determine how the new race categories will impact compliance obligations.  

The EEO-1 report which collects aggregate data on employers’ workforces by race, ethnicity, and gender may have an overhaul in its reporting requirements that will impact how employers collect information from applicants and employees. However, this has no impact on the 2023 data collection of EEO-1 reporting which recently closed on June 4. 

Similarly, the OFCCP will likely incorporate changes in the race categories into any future regulatory changes.  

In the interim, employers may consider how these new categories may impact any internal diversity, equity, and inclusion efforts, in addition to processes that may need to be overhauled for potential new reporting requirements. 

HR Works, headquartered in Upstate New York, is a human resource management outsourcing and consulting firm serving clients throughout the United States for over thirty years. HR Works provides scalable strategic human resource management and consulting services, including: affirmative action programs; benefits administration outsourcing; HRIS self-service technology; full-time, part-time and interim on-site HR managers; HR audits; legally reviewed employee handbooks and supervisor manuals; talent management and recruiting services; and training of managers and HR professionals.