Key Points

• New pay data reporting requirement. New York City enacted two laws requiring private employers with more than 200 employees in New York City to submit annual pay reports detailing compensation by race, ethnicity and sex, modeled on prior EEOC EEO-1 Component 2 reports, with possible modifications by a designated city agency.
• Enforcement, timeline and penalties. The mayor must designate an overseeing agency by Dec. 4, 2026; reporting will begin one year after the agency issues a standardized form. Employers face warnings, a 30-day cure period, fines of $1,000 for initial noncompliance and $5,000 for repeat violations, and public listing of offenders.
• Annual pay equity analysis. A companion law requires the city agency to analyze submitted data annually to identify potential pay disparities by gender, race and ethnicity across industries and to recommend corrective actions to the mayor.

The New York City Council overrode a mayoral veto on Dec. 4, 2025 to enact two laws that will require large employers to submit annual reports detailing compensation by race, ethnicity and sex. The city will then use this data to conduct studies to determine whether pay disparities may exist in particular industries.

Covered Employers

These laws apply to private employers that employ more than 200 full-time, part-time and temporary employees in New York City. Employees outside of the city do not count towards the 200-employee threshold.

Pay Data Reporting Requirements

The pay data reporting law (Int. 0982-2024-A) requires covered employers to submit annual pay data reports to a soon-to-be designated city agency, along with a signed statement by an authorized agent attesting to the accuracy of the information therein. The reports will be modeled after the U.S. Equal Employment Opportunity Commission’s (EEOC) “EEO-1 Component 2 Reports” for reporting years 2017 and 2018, which required employers to place employees in one of 12 salary pay bands, separated by race, ethnicity and sex.

However, the law gives the designated agency the discretion to modify the reporting requirements, including but not limited to, adding options to account for “different gender identities.” Employers will also be given the opportunity to provide “explanatory remarks” concerning any information set forth in the report.

The mayor has until Dec. 4, 2026 to select the city agency that will oversee the pay data reporting process. Once the appropriate city agency is designated, that agency will have one year to create a standardize fillable form that employers may use. Then, no later than one year after the standardized fillable form is created and released to the public, covered employers must begin submitting their annual reports.

The city will give a written warning to employers that do not timely submit the report and an additional 30 days to comply. Failure to comply within the 30-day grace period will result in a fine of $1,000, and any subsequent violation will result in a fine of $5,000. The agency will also publish an annual report on its website containing a list of all offending employers.

Annual Pay Equity Study

The second law (Int. 0984-2024-A) complements the pay data reporting law and requires the designated agency to evaluate this data on an annual basis to determine whether there may be pay disparities among employees based on gender, race, and/or ethnicity in particular industries. The agency will then submit a report to the mayor, and include recommendations on how to rectify the disparities, if any.

Timing and Next Steps

In preparation, covered employers should ensure that they are accurately collecting pay and demographic information for all employees. Employers should also closely monitor when the designated agency publishes the report form to ensure that they timely submit their first report.

For more information, please contact Timothy A. Gumaer at tgumaer@foxrothschild.com, Carolyn D. Richmond at crichmond@foxrothschild.com, Glenn S. Grindlinger at ggrindlinger@foxrothschild.com, or another member of Fox Rothschild's New York Labor & Employment Department.

This information is intended to inform firm clients and friends about legal developments, including the decisions of courts and administrative bodies. Nothing in this alert should be construed as legal advice or a legal opinion. Readers should not act upon the information contained in this alert without seeking the advice of legal counsel. Views expressed are those of the authors and not necessarily this law firm or its clients.