OMB Issues New Guidance on Collection of Race and Ethnicity Data

By: Bill Osterndorf and Joanna Colosimo

Summary of Changes 

A summary of the changes in SPD 15 includes the following: 

• Federal agencies will be required to add a race category for persons with heritage from the Middle East or North Africa (MENA). 
• There will no longer be a separate question about Hispanic ethnicity. Instead, Hispanic will be included in the list of race and ethnicity categories that are part of demographic surveys. 
• Survey respondents must be allowed to select more than one race or ethnic designation. 
• Survey respondents should be provided with opportunities to provide detailed information on race and ethnicity beyond the minimum categories “whenever possible.” 

Federal agencies subject to SPD 15 must provide OMB with an action plan on how revised SPD 15 will be implemented within 18 months of the March 28, 2024, effective date. All agencies subject to SPD 15 must ensure that record keeping and reporting requirements are made consistent with the revised provisions of SPD 15 in the next 5 years, by March 28, 2029. 

Minimum Categories for Data Collection to Include Middle Eastern or North African 

The 1997 version of SPD 15 required the collection of demographic data on the following race and ethnicity categories: 

• American Indian or Alaska Native 
• Asian 
• Black or African American 
• Hispanic or Latino 
• Native Hawaiian or Other Pacific Islander 
• White 

While the formal definitions of these categories have been changed slightly, the 2024 version of SPD 15 requires the collection of demographic data on these same categories. The most critical change involving categories for data collection is the inclusion of the new category Middle Eastern or North African. This category is defined as individuals with origins in any of the original peoples of the Middle East or North Africa, including, for example, Lebanese, Iranian, Egyptian, Syrian, Iraqi, and Israeli.  While the definition of “White” previously included persons from the Middle East or North Africa, “White” now includes only “Individuals with origins in any of the original peoples of Europe, including, for example, English, German, Irish, Italian, Polish, and Scottish.” 

The six categories defined in the 1997 version of SPD 15 plus the category Middle Eastern or North African constitute the seven minimum categories OMB expects to be used in reporting. 

No Separate Question Regarding Ethnicity 

The 1997 version of SPD 15 suggested the use of a separate question for ethnicity that asked whether a respondent was Hispanic or Latino. That version of SPD 15 stated that when there was a separate question about ethnicity, the ethnicity question should be asked before a question about race. The 1997 version allowed agencies to collect information on ethnicity in combination with information on race. 

The 2024 version of SPD 15 requires a combined question on race and ethnicity. There will no longer be a separate question regarding status of a respondent as Hispanic or Latino. Hispanic or Latino will be included as one of the minimum categories to be included in a combined survey question on race and ethnicity along with American Indian/Alaska Native, Asian, Black, or African American, Middle Eastern or North African, Native Hawaiian or Pacific Islander, and White. 

Selecting More Than One Race or Ethnicity 

The 1997 version of SPD 15 stated that: 

Respondents shall be offered the option of selecting one or more racial designations. Recommended forms for the instruction accompanying the multiple-response question are “Mark one or more” and “Select one or more.” 

Agencies were encouraged, but not required, to report on all possible combinations of responses when more than one race was selected. Agencies were allowed to collapse combinations of races into a category such as “more than one race” when there was a concern about data quality or confidentiality standards. 

The 2024 version of SPD 15 is much more aggressive on the issue of respondents who wish to identify as more than one race or ethnicity. This version of SPD 15 states that: 

Respondents shall be offered the option of selecting one or more racial and ethnic designations. The question instructions will vary depending on whether there is a write-in field or if there are detailed categories. For questions with detailed categories and no write-in fields, the question instructions should read: “What is your race and/or ethnicity? Select all that apply.’’ When write-in fields are provided, the instructions should read: “‘What is your race and/or ethnicity? Select all that apply and enter additional details in the spaces below.’’ When collecting only the minimum categories, the question instructions should read ‘‘What is your race and/or ethnicity? Select all that apply.’’ 

Detailed Demographic Surveying and Reporting 

The 2024 version of SPD 15 expects that federal agencies will collect detailed demographic data on race and ethnicity. This detailed collection of data is required “unless an agency determines that the potential benefit of the detailed data would not justify the additional burden to the agency and the public or the additional risk to privacy or confidentiality, and therefore requests an exemption from OIRA [the Office of Information and Regulatory Affairs].”  Thus, the plans that agencies provide in the next 18 months will need to consider how they can justify a more limited form of demographic data collection. 

OMB has provided several examples of possible surveys that could be used for demographic data collection. The most detailed survey parallels what has been used in American Community Surveys to collect demographic information from respondents. This detailed survey allows respondents to mark checkboxes for specific race or ethnicity groups within the seven minimum groups. The detailed survey also allows respondents to write in a specific race or ethnicity group. 

While OMB expects federal agencies to make efforts to collect more detailed demographic data, OMB is aware that reporting this data may require collapsing of information into more limited categories. The minimal reporting of this data would involve the seven minimum categories and some type of multiracial category. However, OMB states that this type of reporting should be used in conjunction with another approach that provides more robust reporting on the various combinations included in a multiracial category. 

OMB recommends the use of one of the following approaches in reporting: 

• An approach showing the seven minimum race and ethnicity categories along with other races combined with those categories. Thus, there would be reporting on “American Indian or Alaska Native alone or in combination,” “Asian alone or in combination,” and so on. Under this approach, combined percentages for each category would be greater than 100 percent because the response categories are not mutually exclusive. 
• An approach showing the seven minimum race and ethnicity categories and the most frequently reported combination of them. Thus, there would be reporting on “American Indian or Alaska Native alone,” “Asian alone,” and so on. There would also potentially be reporting on “Asian AND Native Hawaiian or Pacific Islander,” “Hispanic AND White,” “Middle Eastern/North American AND Asian,” and so on depending on which categories respondents most frequently choose when showing more than one race or ethnicity. In this approach, there would be a final category for “All additional Multiracial or Multiethnic groups.”  Combined percentages for each category would equal 100 percent because the response categories are mutually exclusive. 

The first approach noted above would be unhelpful in the context of employment. In essence, such combinations would have all the disadvantages of the “two or more races” category currently used for reporting purposes. A category that has some particular race/ethnicity alone or in combination with other races/ethnicities would concatenate too many persons with dissimilar demographic characteristics. It would not be possible to determine if there are disparities involving the selection of members of any particular demographic group.  It would also be difficult to determine whether outreach efforts meant to attract members of any particular demographic group were having any success. 

The second approach to reporting would be much more useful in the employment context.  However, it would be incumbent on employers and regulatory agencies to define proper limits for the number of categories to use in reporting.  A larger employer could have hundreds of categories if it were to report on each combination of race and ethnicity.  This would be burdensome on the employer and create potential privacy concerns for applicants and employees.  It would be helpful for regulatory agencies to define a minimum number of people who might be included in each category to make reporting more useful, less burdensome, and more protective of employee privacy.  Without some type of limitations, there would be issues with this approach regarding reporting in the equal opportunity/affirmative action realm.  Hundreds of potential categories with small sample sizes would not allow for meaningful analyses on employment concepts such as underutilization. It is also not clear that the Census Bureau or other agencies would be able to provide meaningful data for comparison purposes. 

Creating Consistency in Reporting 

OMB is aware that the provision in revised SPD 15 will result in inconsistencies with previous reporting. The revised version of SPD 15 also attempts to ensure that reporting under the new standards will allow for consistency between agencies and within agencies. To that end, OMB has provided the following guidance: 

• All agencies must be able to aggregate data into the seven minimum categories. A multiracial category may be necessary to allow for this aggregation. 

• The Middle Eastern or North Africa category may be combined with White for purposes of comparison to previous data. 
• More detailed collection of race and ethnicity data should use the subcategories devised by OMB such as “Chinese” within the Asian category or “Polish” within the White category. 

The ability to compare current data to previous data that uses older versions of certain definitions is a common practice when there are changes like those required by revised SPD 15.  For example, employers were allowed to combine “Asian” and “Pacific Islander” after the Pacific Islander category was introduced to compare to previous reporting.  While a single multiracial category may be disfavored for future reporting, the ability to combine data into a multiracial category will be useful to compare to previous reporting. 

Ramifications for Federal Contractors and EEO-1 Respondents 

The 2024 version of SPD 15 has potentially significant ramifications for federal contractors, EEO-1 respondents, and other employers that must collect and report on the demographic data of applicants and employees. 

• Both employer self-identification survey forms and government reporting forms (such as the EEO-1) will need to be revised to include the category Middle Eastern or North African. 
• Hispanic or Latino should be included on survey forms as one of the seven minimally available race and ethnicity choices instead of a separate question, if applicable. 
• Survey forms will need to allow applicants and employees to choose more than one race and ethnicity. 
• HR information systems and applicant tracking systems will need to allow data collection consistent with revised SPD 15. 
• Employers should consider how they will report on applicants and employees who choose more than one race or ethnicity once the Equal Employment Opportunity Commission (EEOC) and the Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) issues additional guidance. 
• Employers should be aware that the use of a category such as “Two or More Races” may be looked on with disfavor by OMB and by agencies governed by SPD 15. 

It may be some time before agencies such as OFCCP and EEOC fully assimilate the new race and ethnicity standards established in revised SPD 15. However, the 18-month deadline to develop a plan of action and the five-year deadline to implement this plan of action are the outer bounds of when agencies may act. OFCCP or EEOC may decide to implement the new standards sooner if they can develop an effective plan to do so and implementation may have ripple effects. For instance, it could be an opportunity for agencies such as OFCCP to require more subgroup-level reporting in affirmative action plans instead of a “total minority” approach.  Additionally, the new categories must be implemented in EEOC reporting requirements and aggregated data provided to the public. 

Other Considerations for Employers 

The 2024 revisions to SPD 15 reflect changes in society and concerns raised by persons who completed demographic surveys using the previous SPD 15 categories.  For example, the interest in having a MENA category for race has been a long-standing concern for members of this demographic.  As another example, some Hispanic individuals have been frustrated by their inability to provide race information under the current two-question structure used to collect ethnicity and race data. 

The implementation of revised SPD 15 may be challenging for employers and regulatory agencies.  Some of the reporting scenarios could result in hundreds of categories, creating significant burdens relating to the complexity of data collection, reporting, and analysis. For federal contractors required to complete comparisons of availability to employment in an affirmative action program, analyzing small groups with potentially limited data may be a daunting task with limited value. Employers that meet the EEO-1 filing thresholds for annual reporting to EEOC must adapt to a new data collection and reporting format that includes, at a minimum, the new MENA category. Employers should evaluate system options and capabilities as they await more information from agencies that oversee regulatory frameworks to understand the full set of implications revised SPD 15 has for their organization.   

This article was originally published in Law360.  To access this article, go to: https://www.law360.com/articles/1826497