EEOC and OFCCP Update, July 2011, Presented by

OFCCP Issues Notice to Revise Scheduling Letter and Itemized Listing

OFCCP has issued notice of proposed revisions to the current scheduling letter and itemized listing of requested information. According to the OFCCP's supporting documentation to its request for revisions, the changes to the itemized listing "will reduce overall burden hours on contractors and enhance OFCCP's desk audit and data analysis abilities." Among the changes are the following:

  • An additional request will be made for leave policies and accommodations of religious observances and practices as well as copies of the VETS-100 and/or Vets-100A for the previous three years
  • The current item 10 which requests the total number and number of minority and female for applicants, hires, promotions, and terminations by job group or job title would be changed to request for each job group and job title the total number as well as the number of African-Americans/Blacks, Asians/Pacific Islanders, Hispanics, American Indians/Alaskan Natives, Whites, and the number of females and males.
  • The current item 11 which requests aggregated compensation data would be changed to request the following employee level compensation data:
    • "For all employees, compensation includes base salary, wage rate, and hours worked. Other compensation or adjustments to salary such as bonuses, incentives, commissions, merit increases, locality pay or overtime should be identified separately for each employee."
    • "You may provide any additional data on factors used to determine employee compensation, such as education, past experience, duty location, performance ratings, department or function, and salary level/band/range/grade."
    • "Documentation and policies related to compensation practices of the contractor should also be included in the submission, particularly those that explain the factors and reasoning used to determine compensation."

The OFCCP estimates that the changes will cause an increased burden on contractors of 26.01 hours. Comments on the proposed revisions will be accepted through July 11, 2011. To review the proposed revisions and supporting documentation or to submit comments see www.regulations.gov.

OFCCP Issues Notice or Proposed Rulemaking Regarding the Vietnam Era Veterans' Readjustment Assistance Act of 1974, as amended

OFCCP has issued a notice of proposed rulemaking which would require "covered Federal contractors and subcontractors to take affirmative action in employment on behalf of specified categories of protected veterans. The proposed regulations would strengthen these affirmative action provisions, detailing specific actions a contractor must take to satisfy its obligations. They would also increase the contractor's data collection obligations, and require the contractor to establish hiring benchmarks to assist in measuring the effectiveness of its affirmative action efforts."

To see the notice of proposed rulemaking click here. The comment period for this notice of proposed rulemaking has been extended to July 11, 2011.

Active Case Enforcement (ACE) Adopted by OFCCP in Compliance Reviews

In December 2010, the OFCCP issued Directive 292 which rescinded the Active Case Management (ACM) procedures adopted in July 2003 because they "eroded OFCCP's enforcement authority." Shortly thereafter on December 16, 2010 Directive 295 was issued outlining the Active Case Enforcement procedures for conducting Supply and Service compliance evaluations. Previously, under the ACM procedures, full desk audits were performed in every 25th review and onsite evaluations were made in every 50th review. Effective on January 1, 2011, the ACE procedures are to perform a full desk audit in every compliance evaluation and every 25th contractor establishment is to be selected for a full compliance review. The ACE procedures have increased the level of scrutiny for federal contractors undergoing an audit by the OFCCP since their implementation.
For the full text of Directive 292 click here and for Directive 295 click here.

Functional Affirmative Action Plans (FAAP) Reinstated

OFCCP issued Directive 296 on June 14, 2011 communicating procedures to be followed when applying for affirmative action plans that are based on business function rather than business establishment. Directive 296 rescinds the notice given by the OFCCP in 2010 that FAAP applications and requests for renewals would no longer be accepted. Therefore, businesses which would like to develop FAAP are now able to apply for approval from OFCCP. According to Directive 296, there are four criteria which define whether a functional/business unit is eligible for consideration as a FAAP. The unit must:

  • Currently exist and operate autonomously.
  • Include at least 50 employees.
  • Have its own managing official.
  • Have the ability to track and maintain its own personnel activity.

Requests for a FAAP must be submitted in writing to the OFCCP Director with a detailed explanation for why the FAAP is appropriate and contain supporting documentation. An eleven-step approval process will then be followed by the OFCCP including a conference to discuss the request. To view Directive 296 in its entirety click here.

OFCCP Recalls Scheduling Letters

OFCCP has recalled scheduling letters issued on June 3, 2011 from the Midwest region. Contractors who received this letter do not need to respond to the requests for information and should receive a recall notice from the OFCCP. If a contractor responded prior to the recall notice, the information submitted should be returned by the OFCCP.

Secretary of Labor Hilda L. Solis Addresses Impact of Wal-Mart v. Dukes

In her address to the National Employment Lawyers Association, Hilda Solis stated in part that "The Walmart decision won't affect our ability to address pay disparities on a broad scale – even if our lawyers have to tweak some of their legal arguments based on the reasoning used in that case." For the full transcript of her remarks click here.

Department of Labor Issues Spring 2011 Regulatory Agenda

The Spring 2011 Regulatory Agenda contains several entries pertaining upcoming proposed rules by the OFCCP such as the implementation of a compensation data collection tool and the additional rules regarding recruitment of veterans and the disabled. The entire text of the Spring 2011 Regulatory Agenda is available here.

Update on the Status of the American Community Survey (ACS) 2006-2010 EEO Special File from the Census Bureau

The Census Bureau is projecting that the EEO Special Tabulation file based on the American Community Survey for 2006 – 2010 will be available for use by the end of December 2012 with access to be provided through the American Fact Finder portal. Since the 1970 decennial Census, the EEO Special Tabulations have been a primary source of benchmark data for employers who contract with the federal government. However, the 2010 EEO Special File differs markedly from the previous EEO Special Files which were tabulations of data collected from the approximately 18 million households (in 2000) that received the Census long form. In contrast, the ACS consists of approximately 2 million interviews per year and the 2010 EEO Special File will be based on the ACS responses for 2006 through 2010, or approximately 10 million households. For more information visit the Census Bureau's ACS home page by clicking here.

EEOC Commission Meeting on Disparate Treatment in 21st Century Hiring Decisions

The EEOC held a meeting on June 22, 2011 regarding disparate treatment in hiring decisions. The meeting is one in a series focused on hiring in the private sector and specifically attuned to examples of disparate impact in hiring decisions in recent cases brought by the EEOC. Additionally, testimony was presented about enhancing the investigation procedures of the EEOC through the use of Commissioner Charges where the EEOC files a charge against an employer based on reliable anecdotal evidence. The need for training of human resource professionals and other employees involved in the hiring process was also highlighted during testimony of best practices by private companies. To read the press release, click here and for written testimony and video of the meeting click here.

EEOC Explores Collecting Compensation Data

On May 24 the National Academy of Sciences hosted a workshop entitled "Expert Study on Measuring and Collecting Pay Information from U.S. Employers by Gender, Race, and National Origin". This meeting was part of a study sponsored by the EEOC in support of the Commission's ongoing efforts to identify appropriate methods to collect additional data on private employee compensation. This exercise was initiated as a result of the following recommendation from the 2010 report by the White House National Equal Pay Enforcement Task Force:

Collect data on the private workforce to better understand the scope of the pay gap and target enforcement efforts. Private sector employers are not required to systematically report gender-identified wage data to the federal government. This lack of data makes identifying wage discrimination difficult and undercuts enforcement efforts. We must identify ways to collect wage data from employers that are useful to enforcement agencies but do not create unnecessary burdens on employers.    

The committee that participated in the meeting includes subject matter experts from the EEOC, OFCCP, Department of Justice, academia, law, and economic consulting. The topics discussed were the following:

  • Motivating EEOCs need for private compensation data
  • EEOC current data collection tools
  • OFCCP data collection
  • Publicly available data on wages
  • Compensation data collection in the states
  • Enforcement and litigation using EEOC data
  • Appropriate measures of compensation

  • The workshop continued for a second day that was closed to the public. The committee is expected to produce a report in the Fall of 2011.

    Meet the Experts

    July 25 – 29, 2011, New Orleans Marriott, New Orleans, LA
    29th Annual National Industry Liaison Group
    ERS Group is an exhibitor.  For information, visit http://ilgconference2011.com/index.html

    July 27 – 28, 2011, Sutton Place Hotel, Chicago, IL
    ACI Consumer Finance Class Actions & Litigation Conference
    ERS Group is an exhibitor. For information, visit www.americanconference.com
    To register, contact info@ersgroup.com.

    July 27 – 28, 2011, Helmsley Park Lane, New York, NY
    ACI Defending & Managing High Exposure Employment Claims of Retaliation & Discrimination
    ERS Group is an exhibitor.  For information visit www.americanconference.com

    August 8 - 11, 2011, J.W. Marriott Desert Springs Resort, Palm Desert, CA
    26th Annual Federal Dispute Resolution Conference
    ERS Group is an exhibitor. For information, visit http://www.fdrconference.org

    September 20-21, 2011, Sheraton Fisherman's Wharf, San Francisco, CA
    ACI Wage and Hour Claims and Class Actions
    ERS Group Speaker: Paul F. White, Ph.D.
    For information visit www.americanconference.com

    September 20, 2011, Jacksonville ILG Meeting, Jacksonville, FL
    ERS Group Speaker: George Desloge

    October 14 - 15, 2011, Sheraton Park Hotel, Anaheim, CA
    29th Annual Labor and Employment Law Section of the California Bar Association
    ERS Group Speaker: Hossein Borhani, Ph.D.
    For information, visit http://laborlaw.calbar.ca.gov/LaborLaw.aspx

    November 2 - 5, 2011, Westin Seattle, Seattle, WA
    5th Annual Labor & Employment Law Conference
    ERS Group Speaker: Mary D. Baker, Ph.D
    ERS Group is an exhibitor.  For information visit www.americanbar.org/groups/labor_law

    ERS Group labor economists and AAP professionals are available to discuss issues related to compliance with the OFCCP and EEOC, as well as to discuss topics such as compensation, hiring, promotion, termination and wage and hour analyses for internal monitoring and litigation.
    For more information about ERS Group, visit our website, www.ersgroup.com
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