the latest significant developments at ofccp - neli · national employment law institute ofccp...

NATIONAL EMPLOYMENT LAW INSTITUTE

OFCCP MID-YEAR UPDATE WEBINAR

The Latest Significant Developments at OFCCP

April 23, 2015

Presented By:John C. Fox, Esq.

Fox, Wang & Morgan P.C.315 University Avenue

Los Gatos, CA 95030Phone: (408) 844-2350

© 2015 Fox, Wang & Morgan P.C.

2

AGENDA

1. Catalogue: The President’s Recent Executive Order Hit Parade………………………………………………………… p. 6

2. Catalogue: DOL’s Recent Significant Regulatory Publications Not Related To Presidential EOs.......................p. 7

3. Upcoming Dates Of “Balls In The Air”....................................p. 84. OMB Switcheroo #1: Newest Surprise and Confusion:

The New V.E.T.S. PV Reporting Form (VETS-4212) Does Not Require A Report of The Four Species Of Protected Veterans..……………………………………………................... p. 10

5. OMB Switcheroo #2: The Vietnam Era Veterans Readjustment Assistance Act of 1974 is now 4212 (and not “VEVRAA”)…………………………....................................p. 14

3

6. Where Are The Hot Spots in OFCCP Audits?........................p. 16

7. The Enormous Changes in OFCCP Audits - Wage-Hour’s Big Win in the Mortgage Bankers Case..................................p. 30

8. OFCCP’s New Audit Scheduling Letter.................................p. 35

9. The New OFCCP Audit Scheduling Letter Requests Some § 503/§ 4212 Data Not Yet Ripe To Harvest………………….p. 46

10. Kors Must “Up Their Game” On Positive Outreach And Recruitment Of Protected Veterans & Individuals With A Disability………………………………………………………..p. 55

AGENDA (CON’T.)

4

11. Kors Must “Up Their Game” On Job Listings…………........p. 57

12. OFCCP’s Coming “Equal Pay Report” .………………………p. 60

13. OFCCP Prohibitions On Compensation “Secrecy”. ..……….p. 83

14. EEO EO: “Gender Identity” And “Sexual Orientation” Discrimination Unlawful……………………………………….p. 90

15. NEW Labor Law Certifications For Contract Bids…………p. 99

16. “Section 503 and the EEOC’s Proposed ADA “Wellness” Rule”……………………………………………………………….p.106

AGENDA (CON’T.)

5

ABBREVIATION KEY

DOL = U.S. Department of Labor

Ees = Employees

EO = Executive Order

FR = Federal Register

K = Contract

Kor = Contractor

LGBT = Lesbian, Gay, Bisexual, Transgender

NPRM = Notice of Proposed Rulemaking

6

1. THE PRESIDENT’S RECENT EXECUTIVE ORDER HIT PARADE

Presidential Action Regulatory Response *Further Regulatory Respons1e1) Minimum Wage, EO 13658, amends

nothing (February 12, 2014; 79 FR 9851-February 20, 2014)

October 7, 2014: ...... DOL Final Rule: Minimum Wage ($10.10) for certain federal Kors

January 1, 2015: ...... New $10.10 Federal Minimum Wage became legally effective as to “new” contracts signed on or after this date

2) Non-Retaliation for Disclosure of Compensation Information, EO 13665, amending EO 11246 (April 8, 2014; 79 FR20749-April 11, 2014)

September 17, 2014: …… OFCCP’s NPRM re: “Government contractors prohibitions against pay secrecy policies and actions”

January 5, 2015: ......Last day public may comment on NPRM

3) “Presidential Memorandum” [directing OFCCP to issue compensation data collection tool] amending nothing (April 9, 2014)

August 8, 2014: …… OFCCP’s NPRM re “Government contractors, Requirement To Report summary data on employee compensation”

January 5, 2015: ......Last day public may comment on NPRM

4) Equal Employment Opportunity [LGBT], EO 13672 amending EO 11478 and 11246 (July 21, 2014; 79 FR 42971-July 23, 2014)

December 9, 2014: …… OFCCP Final Rule: LGBT (legally effective April 9, 2015)

April 10, 2015: FAR Council Published Interim Rule re OFCCP LGBT Rule. See 80 Federal Register 15609.

5) Fair Pay and Safe Workplaces [Labor Law Compliance Certifications for K Bids], EO 13673 (July 31, 2014; 79 FR45309-August 5, 2014) amending nothing

No proposed Rules yet from FAR Council, but USDOL has privately submitted its comments in April 2015 to OMB

NOTE: there are often two different dates on Presidential documents

− Date signed− Date in Federal Register… a few days after signing

7

2. DOL’S RECENT REGULATORY PUBLICATIONS

DATE OFCCP REGULATORY ACTIONFURTHER REGULATORY

ACTION

1. March 24, 2014:..……OFCCP’s Final Regulations § 503/VEVRAA

2. September 25, 2014:...VETS Final Rule: Annual Report from federal contractors: VETS-4212

3. October 1, 2014:.……OFCCP New Audit Scheduling Letter and Itemized Listing (effective Oct. 15, 2014)

4. October 27, 2014:…... VETS-4212 Final Rules legally effective

5. November 2014:...….. OMB approved the VETS-4212 Form

6. January 30, 2015:…...OFCCP published a NPRM re “Discrimination on the Basis of Sex”

April 14, 2015 = Deadline for public comment

8

3. UPCOMING DATES OF “BALLS IN THE AIR”

9

1) “August 2015”: OFCCP’s projected date to issue a Final Rule re compensation data collection tool (Equal Pay Report)

2) “September 2015”: OFCCP’s projected date to issue a Final Rule to implement EO 13665 (“pay transparency”)

3) “September 2015”: OFCCP’s projected date to issue NPRM to update construction Rules (41 CFR § 60-4)

4) January 20, 2017: President Obama’s last day in office

3. UPCOMING DATES (CON’T.)

10

4. OMB SWITCHEROO #1: NEWEST SURPRISE ANDCONFUSION: THE NEW V.E.T.S. PV REPORTING FORM (VETS-4212) DOES NOTREQUIRE A REPORT OF THE FOUR SPECIES OFPROTECTED VETERAN

New reality: OFCCP Post-Offer Self-ID requirement follows the V.E.T.S. reporting form: no subgroup reporting required

Veterans Employment and Training Service (V.E.T.S.) Final Rule: September 25, 2014

Effective date: October 27, 2014

−(affects 2015 VETS-4212 filings)

VETS-100 form and pre-“Jobs for Veterans Act” rules (pre-Dec 1, 2003) rescinded/removed: GONE!

So, 41 CFR § 61-250 rescinded/removed

VETS-100A form renamed to “Federal Contractor Veterans’ Employment Report: VETS-4212

So, this Final Rule amends 41 CFR § 61-300

11

4. NEWEST SURPRISE AND CONFUSION: POST-OFFER 4212 SELF-ID FORM… (CON’T.)

V.E.T.S. Final Rule: September 25, 2014 (con’t.)

These regs now catch-up to OFCCP’s VEVRAA regs and properly (and only) identify the four species of Protected Veterans

“Employee” definition unique to VETS-4212 report:

- W-2 ees

+ - leased ees

- not “persons” hired on a casual basis for a specified time or for the duration of a specified job (i.e. construction)

- not those temporarily hired through Ee Kor or agent

- not independent contractors

Only two month filing window: August 1 – September 30

10 or more locations must file electronically

The Big News: you will report ONLY the headcount of all PVs - - - as noted above - - you will not report how many of each of the four species of PV are present in your workforce

12

OFCCP had announced in Spring 2014 that the Post-Offer 4212 Self-ID form would require identification of the four species of Protected Veterans (in contradistinction to the Pre-Offer Self-ID which prohibits same)

V.E.T.S. then published on September 25, 2014 its final V.E.T.S 4212 Rules and sent to OMB its proposed new VETS-4212 form

The proposed VETS-4212 form then became visible to the public in mid-October and called for reporting on the number of Protected Veterans (in gross: no sub-categories)

V.E.T.S. approved the final VETS-4212 form in November 2014: http://www.reginfo.gov/public/do/PRAViewIC?ref_nbr=201407-1293-001&icID=14762


13

OFCCP’s regs thus now require only a count of PVs (as a whole: no subgroups) on Kor Post-Offer Self-ID forms. See 41 CFR § 60-300.42 (b) “Post-offer.”

“… the contractor shall invite applicants to inform the contractor whether the applicant believes that he or she belongs to one of more of the specific categories of Protected Veterans for which the contractor is required to report pursuant to 41 CFR Part 61-300.” * * * (emphasis added)

Note: Kor may (not required) exercise its discretion to deploy a Post-Offer, Pre-Employment inquiry to job offerees asking (not requiring) them to identify which of the 4 Protected Veteran categories they fall into

Why would Kor want to do that?

Hint: “Recently Separated PV” issue


14

5. OMB SWITCHEROO #2: THE VIETNAM ERA VETERANS READJUSTMENT ASSISTANCE ACT OF 1974 IS NOW 4212 (AND NOT “VEVRAA”)

New reality: “VEVRAA” is now “4212”

− OFCCP adopted “VEVRAA” as its nomenclature in March 24, 2014 503/VEVRAA Rules

− OMB has now changed the terminology at both OFCCP and at V.E.T.S.

15

5. OMB SWITCHEROO #2 (CON’T.)

− Witness:

• OFCCP new audit Scheduling Letter: “Section 4212 (VEVRAA)”

• OFCCP Power Points now titled “4212”

• V.E.T.S new PV reporting form is “VETS-4212”

• Changes. Changes. Changes in Kor writings… to AAP name? to AAP language? to writings in which you describe OFCCP’s compliance obligations…

16

The Big Picture Over Time:

6. WHERE ARE THE HOT SPOTS IN OFCCP AUDITS

0

5,000

10,000

15,000

20,000

25,000

Total Audits

Compliance Evaluations

FY2009-FY2014

23,734

6. WHERE ARE THE HOT SPOTS IN OFCCP AUDITS

17

0

5,000

10,000

15,000

20,000

25,000

Total Audits Total Audits with NoViolations

23,734

Compliance Evaluation Outcomes

FY2009-FY2014

76%

6. WHERE ARE THE HOT SPOTS IN OFCCP AUDITS (CON’T.)

18

0

5,000

10,000

15,000

20,000

25,000

Total Audits Total Audits with NoViolations

Recruitment Violations

23,734

76%

17%


FY2009-FY2014


19

0

5,000

10,000

15,000

20,000

25,000

Total Audits Total Audits withNo Violations

RecruitmentViolations

Record KeepingViolations

23,734


FY2009-FY2014

76%

17% 11%


20

0

5,000

10,000

15,000

20,000

25,000

Total Audits Total Auditswith No

Violations


Record KeepingViolations

Past Perf.Violations


FY2009-FY2014

76%

17% 11% 8%

23,734


21

0

5,000

10,000

15,000

20,000

25,000


Violations


RecordKeeping

Violations


Written AAPViolations


FY2009-FY2014

76%

17% 11% 8% 6%

23,734


22

0

5,000

10,000

15,000

20,000

25,000


Violations


RecordKeeping

Violations



HiringViolations


FY2009-FY2014

76%

17% 11%8% 6%

2%

23,734

6. WHERE ARE THE HOT SPOTS IN OFCCP AUDITS (Con’t.)

23

0

5,000

10,000

15,000

20,000

25,000


Violations


RecordKeeping

Violations



HiringViolations

SalaryViolations


FY2009-FY2014

76%

17% 11%8% 6%

2% 0.5%

23,734

6. WHERE ARE THE HOT SPOTS IN OFCCP AUDITS (Con’t.)

24

25

During the 5 ½ -year period FY 2009 – FY 2014, OFCCP has found compensation violations in only ½ of 1% of all audits.

Per OFCCP’s own enforcement data


26

FY 2009 – FY 2014• Most gender cases involved

less than four females

• Only two gender compensation cases were large enough to warrant a press release.


27

http://ogesdw.dol.gov/views/data summary.php

OFCCP Enforcement Database


28

29

Here are OFCCP’s current top violations of interest:

1) Failure of external dissemination of policy, outreach and positive recruitment: § 503 (41 CFR § 60-741.44(f))

2) Failure of external dissemination of policy, outreach and recruitment: § 4212 (41 CFR § 60-300.44(f))

3) Recordkeeping violations: EO (41 CFR § 60.1.12)4) Failure to list available job openings: § 4212 (41 CFR §

60-300.5(a)(2))5) Entry-level production laborers failure to hire

discrimination claims: EO (41 CFR § 60-1.4(a)(i))


30

PEREZ, SECRETARY OF LABOR, ET AL. v. MORTGAGE BANKERS ASSOCIATION ET AL., No. 13–1041( 3/9/15)

HELD: Federal agencies need NOT undertake Notice and Comment pursuant to the Administrative Procedure Act (“APA”) before changing their prior interpretation of an agency Rule (i.e. “regulation”).

7. THE ENORMOUS CHANGES IN OFCCP AUDITS - WAGE-HOUR’S BIG WIN IN THE MORTGAGE BANKERSCASE

31

BACKGROUND: Pursuant to the APA, there are two types of Rules:

“Legislative-Type Rules”, which have the binding force and effect of law (as though issued by The Congress); and

“Interpretive Rules”, which do NOT have the binding force and effect of law but are merely the agency’s interpretation of the agency’s Rule. (The important issue as to Interpretive Rules is whether the agency will give the Interpretation any “deference”).

7. THE ENORMOUS CHANGES IN OFCCP (CON’T.)

32

IMPORTANT QUOTE: The U. S. Court of Appeals for the D.C. has “held, in a line of cases beginning with Paralyzed Veterans of Am. v. D. C. Arena L. P., 117 F. 3d 579 (1997), that an agency must use the APA’s notice-and-comment procedures when it wishes to issue a new interpretation of a regulation that deviates significantly from one the agency has previously adopted. The question in these cases is whether the rule announced in Paralyzed Veterans is consistent with the APA. We hold that it is not.”

FOX CONCLUSION: Federal agencies, including OFCCP, now enjoy an open field day to change prior interpretations “on a dime” with no notice to or comment from the public or Kors.


33

IMPACT ON KORs:

1) Changes now will erupt in audits, out-of-the-blue, without warning Kor challenge increases: to identify a true change of policy and not

just mere local aberrant OFCCP behavior

2) We are already seeing willy-nilly OFCCP changes of position: Minority goals now required in AAPs in Puerto Rico and Hawaii

Adverse Impact Analyses required as part of annual AAPs for Minorities/Women

Back-to-back Blanket Purchase Agreements valued by all sequential BPAs added together

Under 50 employee in establishment audits

Audit target selection standards (now by industry and company and prior audit history)


34

NOTE: Why did the conservatives on the Supreme Court deliver this unbridled authority back to the federal agencies?

They did so as a quid pro quo for hearing the next case in the string: whether the APA compels federal courts to pay any “deference” to agency interpretations, thus leaving the original unvarnished agency Rule to be subject to Court interpretation without the Court having to pay homage to the federal agency’s views

In chess, one often sacrifices a pawn to kill a more valuable opponent


35

After 3 years of waiting, Pat Shiu gets her new audit Scheduling Letter for Supply and Service contractors

After 35 years, OFCCP gets one of its fondest hopes: its hands on individual, employee-level compensation data on day 31 of the audit

8. NEW OFCCP SCHEDULING LETTER

36

BIG ITEMS IN NEW ITEMIZED LISTING:

Applies to all Supply & Service audits, including universities; Corporate Management Compliance Evaluations (CMCE = “Glass Ceiling” HQ audits); and Functional Affirmative Action Plan (“FAAP”) audits

New documents:

OFCCP audit Scheduling Letter for Supply & Service Compliance Evaluations

Itemized Listing, attached to Scheduling Letter, has doubled from 11 document demands (i.e. “11 paragraphs”) to 22 paragraphs

8. NEW OFCCP SCHEDULING LETTER (CON’T.)

37

EO 11246 CHANGES:

Demands “[d]ata on your employment activity (applicants, hires, promotions, and terminations)… .”

Clarifies it seeks only data (not analyses)

Refers to “applicants” (not mere expressions of interest)

Does not define hires (but you may include rejected “offers”)

OFCCP now demands to know your definition(s) of promotion


38

EO 11246 CHANGES (con’t.):

Does not define terminations (you should supply only involuntary terminations = to allow review of “adverse action”)

Allows submission by “Job Group” or “Job Title” (as I have been advising for the last 8 years, you will want to form Job Groups = similarly situated employees and thus always submit by such carefully designed Job Groups)

Compensation requests:

– Employee level data

– Broad definition of compensation


39

COMPENSATION DATA DEMAND:Here is what (very poorly drafted) para 19 says in pertinent part, starting with the command sentence contained within the OFCCP audit Scheduling Letter:

“For the desk audit, please submit the following information: ***

3. the support data specified in the enclosed Itemized Listing.”

* * * *

19. “Employee level compensation data for all employees * * *. For all employees, compensation includes base salary and or wage rate, and hours worked in a typical workweek. Other compensation or adjustments to salary, such as bonuses, incentives, commissions, merit increases, locality pay or overtime should be identified separately for each employee.” (color emphases added)


40

COMPENSATION DATA DEMAND (Con’t.):

NOTE: one must infer from the red sentence that “compensation data” includes bonuses, since the green highlighted sentence fails to identify bonuses as “included” within the definition of compensation. Then, the blue highlighted sentence uses the word “should” and both (a) as a result, gives the contractor discretion to submit one compensation figure for each employee while (b) also only infers that “…bonuses, incentives, commissions, merit increases, locality pay or overtime…” are included within the definition of “compensation data” (but bonus data is very clearly inferred, or why else would OFCCP discuss these forms of pay entitlements in Para 19 which seeks “compensation data”?).


41

ENTIRELY NEW SECTION ON § 503:

“Results of the evaluation of the effectiveness of outreach and recruitment efforts… .”

“Documentation of all actions … taken to comply with the audit and reporting system requirements… .”

“Documentation of” new data metrics requirement.

“The utilization analysis… .”

“Copy of reasonable accommodation policies, and documentation of any accommodation requests received and their resolution, if any.”


42

ENTIRELY NEW SECTION ON § 503 (con’t.):

“… most recent assessment of … personnel processes … the date …, any actions taken or changes made …, and the date of the next scheduled assessment.”

“… most recent assessment of physical and mental qualifications, … including the date …, any actions taken or changes made …, and the date of the next scheduled assessment.”


43

ENTIRELY NEW SECTION ON § 4212:

“Results of the evaluation of the effectiveness of outreach and recruitment efforts … .”

“Documentation of all actions taken to comply with the audit and reporting system requirements … .”

“Documentation of” data metrics. “Documentation of the hiring benchmark adopted, … .” “… most recent assessment of … personnel processes, …

including … date …, any actions taken or changes made …, and the date of the next scheduled assessment.”

“… most recent assessment of physical and mental qualifications, …, including … date …, any actions taken or changes made …, and the date of the next scheduled assessment.”


44

FINALE:

“If any of the requested information is computerized, you must submit it in an electronic format that is complete, readable, and usable. (emphasis added) Please use caution when submitting large electronic files. Check with the OFCCP Compliance Officer and your system administrator to ensure adherence to administrative and system guidelines.”

− FTP sites on the horizon?

− Thumb drive sales to increase?

− Burn a CD Rom disk?


45

FINALE (con’t.):

“We estimate that the average time required to complete this information collection is 27.9 hours per response, including the time for evaluating instructions, searching existing data needed, and completing and evaluating the collection of information.”

ENJOY!


46

9. THE NEW OFCCP AUDIT SCHEDULING LETTER REQUESTS SOME § 503/§ 4212 DATA NOT YET RIPE TO HARVEST

New Reality as of March 24, 2015: All Kor “Phase-In” of the new § 503/ § 4212 AAP requirements have now expired a full year after OFCCP’s “New” Rules went to Final (03/24/2014)

Punch line: All contractors must now be complying with OFCCP’s March 14, 2014 § 503/§ 4212 Rules

47

9. THE NEW OFCCP AUDIT SCHEDULING LETTER… (CON’T.)

• So, two situations will now present themselves:1) No OFCCP data demands are ripe (because this is a

“transition AAP” and 6 months might have not yet have elapsed in life of this transition AAP)

2) After 6 months into transition AAP, the four 6-month update sections of the Itemized Listing will attach

NOTE: After 12 months of transition AAP, first “fully loaded” AAP (and there are some out there already) will be subject to full force of OFCCP audit Scheduling Letter

48

Scenario 1) OFCCP demands not yet ripe. If this is the Kor’s “Transition AAP,” the following data would not yet be ripe:

Section 503

− Para 7: results of effectiveness review = .44(f);

− Para 8: documentation of actions re audit reporting = .44(h);

− Para 9: “data metrics” = .44(k);

− Para 10: utilization analysis = .45

− Para 21: annual self-assessment = .44(b);


49

List of data not yet ripe OFCCP requests in its October 15, 2014 Itemized Listing (con’t.):

Section 4212

− Para 11: results of effectiveness review = .44(f);

− Para 12: documentation of actions re audits/reporting = .44(h);

− Para 13: “data metrics” = .44(k);

− Para 14: documentation hiring benchmark = .45(b)(2);

− Para 21: annual self assessment = .44(b);


50

Scenario 2) “6-Month” Data Are Ripe, the Rest Are Not Yet Ripe

There are 6 paragraphs of the Itemized Listing requiring a 6-month update, but only 4 are applicable to Section 503/4212 and only as to all AAPs dated on or AFTER March 24, 2014 and BEFORE October 25, 2014 Note: April 23, 2015 (today) minus 180 days =

October 25, 2014 (i.e. your AAP is 6 months old) So, if your post-March 24, 2014 503/4212 AAPs are 6

months old/older (i.e. dated on or before October 25, 2014), you need to cough up the 6-month reports


51

Scenario 2) “6-Month” Data Are Ripe (con’t.)

Here is the index of the 6 six-month report paragraphs, 4 of which apply to § 503/§ 4212 and 2 of which apply to EO 11246:

− Para 9: “data metrics = .44(k) (§ 503);

− Para 10: utilization analysis = .45 (§ 503);

− Para 13: “data metrics” = .44(k) (§ 4212);

− Para 14: documentation of hiring Benchmark and current year results (§ 4212)


52

Scenario 2) “6-Month” Data Are Ripe (con’t.)

− Para 17: Progress towards goals update (requires update, but not applicable to 503/4212 data):

• applies only to E.O. 11246 AAP

• is NOT applicable in transition year to § 503 AAP, at any rate, because you have no Utilization Analysis and thus no goal yet; and

• is not applicable to § 4212 Benchmark since it is “not a goal” and Kors have no “action-oriented program” requirements

− Para 18 Disparity Analyses (for “applicants and hires,” promotions and terminations) apply only to Executive Order 11246 Program and not to § 503/§ 4212


53

Looking Forward In Time: RecapSo, now that the Phasing-In is over (latest possible § 503/§ 4212 AAPs Phase-In date was March 23, 2014 which delayed Subpart C compliance through March 23, 2015), then:

1) OFCCP audit Scheduling Letters received after Phase-In completed might:

First demand data not yet ripe (because this is a transition AAP and 6 months might have not yet have elapsed in life of this transition AAP)

After 6 months into transition AAP, the four 6-month update sections will attach

After 12 months of transition AAP, first “fully loaded” AAP will be subject to full force of OFCCP audit Scheduling Letter


54

Looking Forward In Time (Con’t.)

Here is my suggested response to OFCCP’s new audit Scheduling Letter as to its request for “not yet ripe data”:

“We have supplied no documents in response to paragraphs 7-10 and 21 (§ 503) and 11-14 and 21 & 22 (§ 4212) of the Itemized Listing attached to OFCCP’s [DATE] audit Scheduling Letter. OFCCP’s Section 503/4212 regulations do not yet require the Company to develop these data and they are thus not yet ripe for OFCCP review.”


55

A. No changes to content in Obama Administration of these almost 20 year old outreach Rules

Enforcement emphasis has changed dramatically

OFCCP sincerely believes positive outreach and recruitment is the “magic sauce” which will get PVs and IWDs hired

Step back and think about it: this is purest form of Affirmative Action

10. KORS MUST “UP THEIR GAME” ON POSITIVE OUTREACH AND RECRUITMENT OF PROTECTED VETERANS & INDIVIDUALS WITH A DISABILITY

56

B. What does Kor have to do these days for OFCCP to find it compliant?

“Engaged recruitment”

No third parties

No “hit send” mass emails

Dial it in, make it personal

o “valet service” recruitment

10. KORS MUST “UP THEIR GAME”… (CON’T.)

57

A. Vendors and law firms need to first get the language right

To do that, they need to understand the requirement

B. “Listing” ≠ “Posting”: Not synonymous/interchangeable terms

Listing

Kor (or agent) Veteran’s Representative =Vet Rep“lists” with

Posting

Kor (or agent or local ESDS) Local ESDS website“posts”on

11. KORS MUST “UP THEIR GAME” ON JOB LISTINGS

58

SWARM Regional Director, Melissa Spears, at 2014 ILG National Conference:

“If you post but don’t list, you will be cited”

Example: DirectEmployers:

1) Entered into exclusive partnership with the National Association of State Workplace Agencies (NASWA)

2) DE then built for NASWA a software tool known as the “National Labor Exchange” (NLX)

• NLX scrapes DE member websites and “lists” (not “posts”) available jobs in the “manner and format” each ESDS prefers

• Failsafe: Works every time so long as the DE Member “posts” each available job on its website for the NLX to find and scrape

You cannot skip the ESDS VET Rep.

• Why not?

− What’s the purpose of the “listing” requirement?

11. KORS MUST “UP THEIR GAME” ON JOB LISTINGS (CON’T.)

59

3) Real world issues:

• OFCCP Compliance officers sometimes do not know the difference between “listing” and “posting” and want evidence of the ESDS “posting”

OFCCP Policy Director Debra Carr and OFCCP Director Pat Shiu know the difference and want evidence of the “listing” (not “posting”)

• Kors do not have to prove the “posting”

• Kors do have to prove they “listed”

− How can/do Kors prove they “listed”?

11. KORS MUST “UP THEIR GAME” ON JOB LISTINGS (CON’T.)

60

12. OFCCP’S COMING “EQUAL PAY REPORT”

WARNING: Two more acronyms to learn:

-EPR (Equal Pay Report)

-OIS (Objective Industry Standard)

61

Amends ONLY 41 CFR § 60-1.7 (Reports and other required information)

Repeats standard EEO-1 filing requirement

12. OFCCP’S COMING “EPR” (CON’T.)

62

Would add a new “Equal Pay Report.” EPR requires Kors and SubKors >100 employees to provide “summary data” on:

compensation paid to Ees “by sex, race, ethnicity, specified job categories, and other relevant data points”

in format and manner required by OFCCP


63

Must be filed by each: prime contractor and first tier subcontractor required to file

the EEO-1 Report(s)/IPEDs

with > 100 employees,

a K, SubK, or purchase order > $50,000 or more

that covers a period of at least 30 days, including modifications

Note: this footprint eliminates about 80% of the universe of federal Kors

Practice Tip: If this Rule goes to final, Kors will then need to catalogue their federal Ks to determine whether they must file the new EPR


64

Practical issues

1) As proposed, covered Kors need to report in the 1st quarter of the year, compensation data for employees who appeared in the contractor’s EE0-1 report the contractor filed 3 to 9 months earlier

• Practice tip: Kors will need to preserve the identities of the individuals in the EE0-1 filing so as to generate the corresponding pay reports 3 to 9 months later

o This is known as a data integration challenge


65

Practical issues (con’t.)

2) Put perturbating on your “To Do” list - the in-thing to do in 2015

o Always perturbate compensation datao No names: use numeric identifiero No references to company name or locationo Password protect if you send via-email


66

Practical issues (con’t.)

2) Put perturbating on your “To Do” list (con’t.)

o Consider use of encrypted FTP site if you use the Net o Try to avoid the Net altogether: send a password

protected thumb drive/CD Rom disk to OFCCPo Perturbate job titles by assigning numeric identifiers o Send in key codes separately to OFCCP


67

These are calendar year reports due in first quarter of calendar year (as supplemental columns to EEO-1)

Must submit electronically through OFCCP’s web-based filing system (absent hardship waiver)


68

Confidentiality: “OFCCP will treat information contained in the Equal Pay Report as confidential to the maximum extent the information is exempt from public disclosure under the Freedom of Information Act, 5 U.S.C. 552.”

Restrain laughter

Kor argument: confidential/sensitive/release would subject Kor to commercial harm


69

“OFCCP may publish aggregate information based on compensation data collected from” the EPR

“…such as ranges or averages by industry, labor market, or other groupings”

“but only in such a way as not to reveal any particular establishment’s or individual employee’s data.”

Why?

The government is here to help

Huh? Bottom feeding Kors will learn they are at bottom and seek to float up their pay? Really?


70

Why have an EPR, anyway?

Pay discrimination investigative tool?

No. OFCCP audit selection and targeting tool

How to pick targets?

How to weight EPR data harvest relative to FCSS EE0-1 harvest?

o All audits driven by EPR results?

o Half of all OFCCP audits driven by EPR results?

o Weight EPR results 50/50 with FCSS EE0-1 results?


71

Why have an EPR, anyway? (con’t.)Fox observation: Audit pattern will likely change dramatically from FCSS audit selections

Here is what OFCCP says it proposes to do with EPR data:


72

“For purposes of selecting contractors for compliance evaluations using the Equal Pay Report data, OFCCP proposes to focus primarily on a strategy that ranks contractors against the objective standards, and then prioritizes compliance evaluations of those contractors and subcontractors who have larger race or gender pay gaps than what is typically reported in the industry as measured by the objective industry standard described in the section above… .” (emphasis added)


73

“Those contractors and subcontractors who (sic) report patterns with the greatest deviation from the applicable standard would have the highest likelihood of selection for further investigation under this approach. Under its usual compliance evaluation procedures, the agency would then examine their detailed compensation data and practices to make a determination about the contractors’ actual compliance. OFCCP specifically proposes comparing average pay differences across contractors who are in the same industry within EEO-1 job categories… .”


74

“While EEO-1 categories are far too broad to identify pay discrimination at the individual employer level with precision, they are practical and useful for setting enforcement priorities by comparing across employers based on summary data. As explained further in this section, the agency also plans to consider how other data sources may provide information on firm or employee characteristics that would help refine and improve OFCCP’s ability to use Equal Pay Report data to rank contractors and prioritize compliance evaluations. …”


75

“Under the approach proposed by OFCCP, using an objective industry standard, the goal is not simply to identify absolute differences in pay, which may be explained in any particular case by a variety of legitimate factors. Rather, it is to identify contractors with pay differences that substantially depart from the objective industry standard, reducing the likelihood that legitimate factors explain all of the differences.”


76

OFCCP’s compensation disparity sniffer

Industry Subject Company

EE0-1 Category -5% Pay Disparity Women

vs.Men

-10% Pay Disparity Women

vs.Men

5% Pay Disparity Women

vs.Men

8% Pay Disparity Women

vs.Men


77

Usual OFCCP Recordkeeping requirements at: 41 CFR 60-1.12(a) attach plus (New) AA compliance certifications“Requirements for bidders or prospective contractors—(1) Certifications and representations of compliance with the requirements of Executive Order 11246 and its implementing regulations. Each agency shall require each bidder or prospective prime contractor and proposed subcontractor, where appropriate, to represent by a statement in the bid or in writing at the outset of negotiations for the contract:

con’t. on next page.


78

(i) Whether it has participated in any previous contract or subcontract subject to the Equal Opportunity Clause in § 60-1.4(a);

(ii) Whether it is currently required to develop affirmative action programs as prescribed under the regulations in this chapter and to file reports set forth in this section;

(iii) And, if so, whether it developed the affirmative action programs;



79

(iv) Whether it has filed with the Joint Reporting Committee all reports due under the applicable filing requirement; and

(v) Whether it currently holds a Federal contract or subcontract that requires the filing of an Equal Pay Report(s) with OFCCP, and whether it filed an Equal Pay Report with OFCCP for the most recent reporting period, as prescribed by paragraph (b) of this section.”


80

Sanctions: “Failure to file timely, complete and accurate reports, and certifications and representations as required under this section constitutes a violation of Executive Order11246 and its implementing regulations that may subject the contractor to the sanctions.”

See also:

18 U.S. Code § 1001 - Statements or entries generally

“(a) Except as otherwise provided in this section, whoever, in any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States, knowingly and willfully —



81

18 U.S. Code § 1001 - Statements or entries generally

(con’t.): (1) falsifies, conceals, or covers up by any trick, scheme, or device a material fact;

(2) makes any materially false, fictitious, or fraudulent statement or representation; or

(3) makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry; shall be fined under this title, imprisoned not more than 5 years or, if the offense involves international or domestic terrorism (as defined in section 2331), imprisoned not more than 8 years, or both. If the matter relates to an offense under chapter 109A, 109B, 110, or 117, or section 1591, then the term of imprisonment imposed under this section shall be not more than 8 years.”


82

83

13. OFCCP PROHIBITIONS ON COMPENSATION “SECRECY”

April 8, 2014: Executive Order 13665, amending E.O. 11246 September 17, 2014: 30 page OFCCP NPRM January 5, 2015: Last day for public to comment on OFCCP’s

NPRM Bottomed on asserted authority per Federal Property and

Administrative Services Act, 40 U.S.C. § 101 et seq.

“This order is designed to promote economy and efficiency in Federal Government procurement. It is the policy of the executive branch to enforce vigorously the civil rights laws of the United States, including those laws that prohibit discriminatory practices with respect to compensation. Federal contractors that employ such practices are subject to enforcement action, increasing the risk of disruption, delay, and increased expense in Federal contracting. Compensation discrimination also can lead to labor disputes that are burdensome and costly.”

84

“When employees are prohibited from inquiring about, disclosing, or discussing their compensation (emphasis added) with fellow workers, compensation discrimination is much more difficult to discover and remediate, and more likely to persist. Such prohibitions (either express or tacit) also restrict the amount of information available to participate in the Federal contracting labor pool, which tends to diminish market efficiency and decrease the likelihood that the most qualified and productive workers are hired at the market efficient price. Ensuring that employees of Federal contractors may discuss their compensation without fear of adverse action will enhance the ability of Federal contractors and their employees to detect and remediate unlawful discriminatory practices, which will contribute to a more efficient market in Federal contracting.”

13. OFCCP SECRECY PROHIBITIONS (CON’T.)

85

“The contractor will not discharge or in any other manner discriminate against any employee or applicant (emphasis added) for employment because such employee or applicant has inquired about, discussed or disclosed the compensation of the employee or applicant or another employee or applicant. This provision shall not apply to instances in which an employee who has access to the compensation information of other employees or applicants as a part of such employee’s essential job functions discloses the compensation of such other employees or applicants to individuals who do not otherwise have access to such information, unless such disclosure is in response to a formal complaint or charge, in furtherance of an investigation, proceeding, hearing, or action, including an investigation conducted by the employer, or is consistent with the contractor’s legal duty to furnish information.”


86

This OFCCP proposed Rule now seeks to redefine unlawful “discrimination” to occur even though not based on race, sex, national origin, color, religion, disability and/or protected veteran status

Why did OFCCP not cast this rule as anti-retaliation (although Executive Order is so titled)?

Can OFCCP stretch the concept of discrimination law that far to accomplish an employee rights (NLRA) notion?


87

OFCCP’s Proposed Rule

Would amend regs and EEO clauses

Notification to covered federal subcontractors required

Special clauses for federally assisted construction contracts/subcontracts

Identifies and limits Kor defenses

Requires notification to union, if any, employees and job applicants of their rights


88

New (broad) definitions could emerge:

“Compensation means any payments made to, or on behalf of, an employee or offered to an applicant as remuneration for employment, including but not limited to salary, wages, overtime pay, shift differentials, bonuses, commissions, vacation and holiday pay, allowances, insurance and other benefits, stock options and awards, profit sharing, and contributions to retirement.”

“Compensation information means information pertaining to any aspect of compensation, including but not limited to information about the amount and type of compensation as well as decisions, statements, or actions related to setting or altering employees’ compensation.”


89

Effective date: contracts entered into on or after effective date of final OFCCP Rules

Likely trajectory: Late summer 2015

Fox Comment: I think this regulation violates the Separation of Powers doctrine and Kors could more likely than not successfully resist its application

− Prediction: Kors will not resist except if OFCCP tries to force a “discrimination” case in the course of an audit


90

E.O.13672 amended E.O. 11246 (and also E. O. 11478 - - applicable to federal government)

Colloquially known as the Lesbian, Gay, Bisexual and Transgender (LGBT) rights order

OFCCP issued a FINAL Rule (no NPRM) on December 9, 2014

OFCCP Final Rule became legally effective on April 8, 2015

No lawsuit filed seeking to enjoin Rule

14. EEO EO: “GENDER IDENTITY” AND “SEXUAL ORIENTATION” DISCRIMINATION UNLAWFUL

91

14. EEO EO (CON’T.)

E.O. 11246 amended to make unlawful, discrimination based on:

“sexual orientation”

and“gender identity”

Affirmative Action for “sexual orientation” and “gender identity” also required

92

“Affirmative Action” requirements: Update EEO Clause to replace “sex”

discrimination with “sex, gender identity and sexual orientation.”

Covered federal subcontracts

External notifications

Job solicitations: “EOE”


93

What/how “affirmative action” not defined (con’t.)

The President’s EO revisions are not necessarily effective right now as to your company

• E.O. 11246 revisions become legally effective when OFCCP regulations go to final and a Kor signs a new covered federal K on or after April 8, 2015

• 120 day implement action period from publication date = April 8, 2015


94

Interesting analytical schism:

OFCCP Press Release announcing E.O. 13672 predicated coverage on a federal government employee decision known as Macy v. Holder(Attorney General). Macy broke new legal ground

Macy decision concluded that Title VII had alwaysoutlawed sexual orientation discrimination

White House Press Release, however, said The President needed to amend EO 11246 to add LGBT protections since EO 11246 did not protect LGBT


95

What/how affirmative action not defined (con’t.)

Conundrum: If Title VII, and hence E.O. 11246, had always made sexual orientation discrimination unlawful thru their prohibitions on “sex discrimination,” why:

a) did the President have to “amend” E.O. 11246 to establish this protected right?;

b) has Capitol Hill voted down LGBT protections in the 39 out of the last 40 years such protections have been introduced?; and

c) Why has no federal court so held and every federal court has in fact held to the contrary?


96

What/how affirmative action not defined (con’t.)

Prediction: Kors will not resist OFCCP’s LGBT Rule except if OFCCP tries to force a discrimination case in the course of an audit or a complaint investigation

• Fox prediction last year that no federal Kor would challenge OFCCP’s Rule proved true

• The Dilemma: While the Congress has not passed LGBT protections and The President is clearly proceeding beyond his legal authority, The President has properly read the populist sentiment: 76% of Americans, now approve of gay marriage and 36 states now recognize same sex marriages


97

OFCCP now preparing to receive Complaints

Interesting OFCCP does not intend to defer individual LGBT complaints to EEOC per MOU with EEOC

• Could be grounds for an additional Kor procedural ground of defense to OFCCP attempted prosecution of an individual LGBT Complaint


98

OFCCP’s LGBT Rule silent about corporate benefits to same-sex married couples. Federal Kors Must Nonetheless Now Provide Same-Sex benefits as follows:

36 states have now legalized same-sex marriage

the states do so by giving same-sex marriage the same legal status as opposite-sex marriage

most contractors provide medical benefits to those “married”

Wrinkles which arise because of the “place of celebration” rule

If same-sex couple lawfully married in one of the 36 states:

Kor’s Ee assigned to work in one of the 14 states (covered, because lawfully married)

Kor’s Ee’s spouse lives in one of the 14 states (covered, because lawfully married)


99

15. NEW LABOR LAW CERTIFICATIONS FOR CONTRACT BIDS

New statutory and regulatory certifications to become a federal Kor on the horizon to be required

July 31, 2014: E.O. 13673: Fair Pay and Safe Workplaces

• No proposed Rule yet

WHY:

“This order seeks to increase efficiency and cost savings in the work performed by parties who contract with the Federal Government by ensuring that they understand and comply with labor law. Contractors that consistently adhere to labor laws are more likely to have workplace practices that enhance productivity and increase the likelihood of timely, predictable, and satisfactory delivery of goods and services to the Federal Government. Helping executive departments and agencies to identify and work with contractors with track records of compliance will reduce execution delays and avoid distractions and complications that arise from contracting with contractors with track records of noncompliance.”

100

WHAT:

“For procurement contracts for goods and services, including construction, where the estimated value of the supplies acquired and services required exceeds $500,000 each agency shall ensure that provisions in solicitations require that the offeror represent, to the best of the offeror’s knowledge and belief, whether there has been any administrative merits determination, arbitral award or decision, or civil judgment, as defined in guidance issued by the Department of Labor, rendered against the offeror within the preceeding 3 year period for violations of any of the following labor laws and Executive Orders (labor laws) (emphasis added):

* * *(G) Executive Order 11246 of September 24, 1965 (Equal

Employment Opportunity);

(H) Section 503 of the Rehabilitation Act of 1973;

(I) 38 U.S.C. 3696, 3698, 3699, 4214 (sic), 4301-4306, also known as the Vietnam Era Veterans’ Readjustment Assistance Act of 1974;”

15. NEW LABOR LAW (CON’T.)

101

Flow Down

HOW:

“For any subcontract (emphasis added) where the estimated value of the supplies acquired and services required exceeds $500,000 and that is not the commercially available off-the-shelf items, a contracting officer” shall require that, at the time of execution of contract, a contractor represents to the contracting agency that the contractor:

Will require each subcontractor to disclose any administrative merits determination, arbitral award or decision, or civil judgment rendered against the subcontractor within the preceding 3 year period for violations of any of the requirements of the labor laws listed in paragraph (i) of this subsection, and update the information every 6 months; and…” (emphasis added)


102

Flow Down (con’t.)

“before awarding a subcontract, will consider the information submitted by the subcontractor pursuant to subparagraph (A) of this paragraph in determining whether a subcontractor is a responsible source … .”

* * *

“…require that a contractor incorporate into subcontracts … a requirement that the subcontractor disclose to the contractor any administrative merits determination, arbitral award or decision, or civil judgment rendered against the subcontractor… .”

* * *

Newly created “Labor Compliance Advisors” to assist in evaluating the information on labor compliance submitted by subcontractors


103

Effective Date: Not effective until a final Rule to be issued by FAR Council

No deadline set

Will likely take a year, or more, to go final


104

Paper Tiger as to OFCCP’s 3 “Statutes”:

Federal government may not debar or “passover” or otherwise affect adversely federal contractor opportunities without full, formal, and final Administrative Hearing and follow-on hearing (ALJ; ARB; Federal Courts)

With all due deliberate speed: Years pass from problematic OFCCP audit to lawsuit before ALJ determination (which is then only a “Recommended Decision and Recommended Order”). Many more years pass before ALJ/ARB process is ever exhausted (i.e. BofA case currently (simultaneously) in Federal District Court and before ALJ springs from a 1992audit)


105

OFCCP Moves With Glacial Speed…

Also, if the Kor loses, but agrees to cure, Kor cannot be debarred or adversely affected

OFCCP debarment (uniquely in federal contract law) is “incentive” to comply; not a punishment for failure


106

EEOC released to public draft NPRM on April 16, 2015

EEOC published NPRM in Federal Register on April 20, 2015

NPRM only proposes to amend Title I of the ADA to allow “Wellness Programs” meeting 5 conditions

OFCCP did not propose a parallel Rule pursuant to § 503

OFCCP will now need to exercise its discretion to not prosecute Kors under § 503 if they follow the EEOC Rule

OFCCP will eventually find it prudent to issue a Rule in parallel to EEOC Rule

16.“SECTION 503 AND THE EEOC’S PROPOSED ADA “WELLNESS” RULE”

107

Fox, Wang & Morgan is making its Compliance Conversion Kit available to the public, in digital form, including all documents you need to comply, including approximately 120 pages of material, all revised AAPs, almost 40 forms, notices, clauses, evaluations, audits, and surveys, etc. The price for the Compliance Conversion Kit is $3,000 for the general public. Fox, Wang & Morgan clients, National Employment Law Institute seminar/webinar attendees, and Direct Employers members are eligible for substantial discounts. Please contact us for discount pricing information.Contact: Thuy Vu: (408)844-2352; [email protected] order now.

(Vendors will be charged a small additional royalty for use of the forms with each client)

THE FOX, WANG & MORGAN 503/VEVRAA COMPLIANCE CONVERSION KIT

108

Questions?

109

THANK YOU

the latest significant developments at ofccp - neli · national employment law institute ofccp...

Documents