Federal District Court Reinstates EEO-1 Pay Data Report

On Monday, February 4, 2019, the Federal District Court for the District of Columbia ordered that the EEOC’s EEO-1 pay data collection report be immediately reinstated.

The court ordered the Office of Management and Budget (OMB) to immediately lift its stay on the EEOC’s pay data collection report (known as Component 2), saying the decision to implement the stay was “arbitrary and capricious.”  The effect of this ruling is to permit the EEOC to begin collecting pay data at once.  It remains to be seen if this order is immediately carried out.

In a decision focused on the nuances of administrative law, Judge Tanya S. Chutkan sternly rejected OMB’s arguments that it was authorized to issue its stay on the grounds that changes in EEOC’s formatting requirement for the new pay report were burdensome on employers. Granting summary judgment for the plaintiffs, National Women’s Law Center and the Labor Council for Latin American Advancement, the court said that while there may be times when formatting changes could be considered burdensome, this situation was not it.

The ruling also rejected (1) OMB’s challenge to the plaintiffs’ standing to sue because they could not show the stay caused them any harm and (2) that the OMB’s decision to stay implementation was not reviewable because it was not a “final agency action.” The court found that the decision to stay the data collection was itself a harm and that it was reviewable.

The court concluded that because OMB’s action in staying EEOC’s collection of pay data “was arbitrary and capricious” and “totally lacked the reasoned explanation that the [Administrative Procedures Act] requires,” an immediate reinstatement was ordered.

Takeaways for employers: 

Although the court ordered the immediate implementation of EEOC’s Component 2 pay data collection, it is all but certain that OMB will appeal the decision and seek a stay of the court’s order pending resolution of the case.  In addition, once it has a quorum of Republican Commissioners, expect the EEOC to revise or eliminate the requirement to collect pay data. Janet Dhillon has been nominated as Chair and would be the second Republican on the EEOC; however, it is uncertain as to when the Senate will confirm her. Until she is confirmed, the EEOC does not have a quorum and cannot act.  This ruling may create an incentive for the Senate to act on her nomination promptly.

FortneyScott will keep you informed on how this issue will impact you.

OFCCP to Issue 2019 CSALs; Focused Reviews Are Announced

The OFCCP has just announced that they are, “on schedule to post its next Corporate Scheduling Announcement List (CSAL) in OFCCP’s FOIA Library in mid-to-late March 2019.”  As a result, OFCCP will soon be issuing notices to 3,500 federal contractors in the next month.  In the past, CSALs, which are alerts from OFCCP informing contractors that their establishment has been selected for an audit, were mailed directly to the contractor. Now the agency will post the CSALs on its website with contractors responsible for learning on their own if they are to be audited.

The Agency also announced that 500 of the CSALs would be for a new kind of targeted compliance evaluation – a focused review.  These focused reviews are aimed at ensuring compliance not only with Executive Order 11246 but particularly with Section 503 of the Rehabilitation Act and the Vietnam Era Veterans’ Readjustment Assistance Act (“VEVRAA”), that is, the laws designed, in large part, to protect individuals with disabilities.  The focused review will always include on-site interviews with compliance managers and protected employees, as well as reviewing recruiting, hiring, and accommodations data.  To view a copy of the scheduling letter that will be used for OFCCP’s focused reviews, click here.

Register here to join a complimentary FortneyScott “Lunch & Learn” webinar: Preparing for OFCCP Focused Reviews, to be presented on February 27, 2019 at 12 noon, EST.

There will also be changes to the traditional compliance review.  Once the scheduling letters are received, contractors will have 30 days in which to submit their Affirmative Action Plans (AAPs) and the other items required by the scheduling letter and itemized listing.  In order to facilitate a timely submission, the assigned compliance officer will contact the contractor within 15 days of the contractor’s receipt of the Scheduling Letter to offer technical assistance.

OFCCP will grant a one-time 30-day extension for submission of supporting data related to the EO 11246, VEVRAA and Section 503 AAPs, provided the contractor:

  1. Requests the extension prior to the initial 30-day due date for the AAPs; and
  2. Timely submits the basic EO 11246, Section 503 and VEVRAA AAPs within the 30-day period after receiving the Scheduling Letter and Itemized Listing.

Failure to submit AAPs and/or supporting data timely, with approved extensions, will result in an immediate Show Cause Notice.

Please contact your FortneyScott attorney or send an email to info@fortneyscott.com for more information on this new extension policy or for assistance in preparing AAPs and responses to Scheduling Letters.  As more information about the focused reviews becomes available, it will be posted on this site.

New OFCCP Directive Establishes Voluntary Enterprise-wide Program

The OFCCP issued its latest directive, Directive 2019-04, on February 13, 2019, outlining its new Voluntary Enterprise-wide Review Program (VERP). The new program is designed to facilitate and confirm “enterprise-wide (corporate-wide) compliance by high-performing contractors and those aspiring to reach the top through individualized, corporate-wide compliance assistance.”

Contractors selected to participate in the VERP will be removed from the pool of contractors scheduled for compliance evaluations. There will be two-tiers of contractors: the top tier will include top-performing contractors with corporate-wide Diversity and Inclusion programs; the second tier will be contractors who are OFCCP compliant but need individualized compliance assistance to become top performers.  Criteria for the top tier will be more stringent.

To participate in the program, contractors must demonstrate that they meet established criteria that verify not only basic compliance with OFCCP’s requirements, but a demonstrated commitment to and application of successful equal employment opportunity programs on a corporate‐wide basis. A “top-tier” contractor can remain in the program for a period of five years while those at the second level can remain in the program for three years and receive individualized compliance assistance to become a top performer.  Any contractor selected must agree during that period to provide periodic reports and information to OFCCP through which OFCCP can confirm the contractor maintains a workforce free of discrimination or other material violations and also agree that OFCCP retains the right to conduct individual and/or third party complaint investigations to assure “the contractor abides by all terms of the agreement.”  It is not yet clear how OFCCP will make the distinction between “top-tier” and “second level” contractors.

Beginning in FY 2020, applicants will apply electronically online. They will then be subject to the OFCCP corporate headquarters compliance review and compliance reviews of other establishments. Contractors who do not qualify for the program will be returned to the pool of contractors for audit.

OFCCP states that this directive enables the agency to “blend its compliance evaluation and compliance assistance activities to work with high-performing contractors toward a mutual goal of sustained, enterprise-wide (corporate-wide) compliance, outside OFCCP’s neutral establishment-based scheduling process” as well as complementing the goals in its Early Resolutions Procedures.

House Education & Labor Committee Hosts a Joint Subcomittee Hearing on the Proposed Paycheck Fairness Act

Another important plank in the Democrats’ legislative agenda was given an early hearing on Wednesday, February 13, 2019.  A joint hearing on the proposed Paycheck Fairness Act (H.R. 7, S. 270) was held at that time by the House Subcommittees on Civil Rights and Human Services and on Workforce Protections.  An earlier version of Paycheck Fairness Act was passed by the House in 2008 and 2010, but never passed the Senate.  A similar fate is all but certain in this instance, but one purpose of offering the Act now was to set an agenda for the future.

The latest version of Paycheck Fairness Act would amend the Equal Pay Act of 1963 by substantially limiting the affirmative defenses, increasing protections from retaliation, prohibiting employers from asking for or using prior salary to set current pay, and allowing recovery of compensation and punitive damages. In addition, like its predecessor proposals, it instructs EEOC to collect pay data from employers and also to collect “compensation data and other employment-related data (including hiring, termination, and promotion data) disaggregated by the sex, race, and national origin of employees.” OFCCP is again directed to implement a similar survey to be given to half of its nonconstruction contractor establishments each year. The bill also instructs OFCCP not to use multiple regression or anecdotal evidence in its compensation discrimination cases. It further directs the Department of Labor to establish negotiation training for girls and women and a national pay equity in the workplace award among other salary related requirements.

The hearing included testimony from Rep. Rosa L. DeLauro (D-CT), a co-sponsor of the bill; Rep. Eleanor Holmes Norton (D-DC); and Rep. Don S. Breyer, Jr. (D-Va.); Fatima Goss Graves, CEO and President of the National Women’s Law Center; Camille Olson, Partner at Seyfarth Shaw; Kristin Rowe-Finkbeiner, CEO of Moms Rising, and Jenny Yang, former EEOC Chair and Partner of Working Ideal.

As noted, the bill will in all likelihood pass the House but, as in the past, will fail in the Senate at this time. Click here for written transcripts of the witnesses’ testimony and video of the joint subcommittee hearing.

OFCCP Focused Reviews of Accommodations Compliance Announced

OFCCP Director Craig Leen announced that the agency will be posting 500 Corporate Scheduling Announcement List (CSALs) on its website “in the spring” that will be for “focused reviews” of contractors’ Section 503 and VEVRAA compliance. The focused reviews will aim corporate-wide as opposed to establishment compliance.  FortneyScott has learned that OFCCP recently received OMB approval for a revised scheduling letter for these focused Section 503 reviews and a copy of that scheduling letter is here. The focused review CSALs will be part of the 3500 CSALs to be issued this spring.

Contractors should review the Section 503 focused review scheduling letter now so that they can be prepared if they are on the CSAL list. Remember that contractors will not be receiving CSAL letters but rather will have to check the OFCCP FOIA Library webpage.

The focused review CSAL’s are the product of OFCCP’s Directive 2018-04, issued on August 10, 2018, which stated that OFCCP will conduct focused reviews of contractor compliance with (1) Executive Order 11246, (2) Section 503 of the Rehabilitation Act of 1973 (Section 503), and (3) the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA). The focused reviews will be based on onsite visits to perform a comprehensive review of, for example, the Self-ID and accommodations process for affected applicants and employees. OFCCP pledges to provide a “standard protocol” for the reviews to be published in FAQs prior to the posting of the next scheduling list.

For more information on focused reviews and the coming CSAL notices contact your FortneyScott attorney.

Panel to Hold Public Meeting on Federal Procurement and the Future of Bid Protests

The Section 809 Panel will hold public meetings at the
Panel’s offices in Rosslyn, VA on August 14th (Team meeting) and August 22nd
through August 24th (Panel and Stakeholders meetings) to discuss bid protests of Federal procurements
generally, and to specifically examine whether and to what extent the current
bid protest processes at the Agency level, U.S. Government Accountability
Office, and U.S. Court of Federal Claims should be continued and/or
revised. 

If you are interested in attending the August 14th meeting, please contact Susan Warshaw Ebner at sebner@fortneyscott.com

 

Section
809 of the National Defense Authorization Act for FY 2016, as amended, requires
the Department of Defense (“DoD”) to convene a panel of acquisition experts
from Government and the Defense Industry to research, review and make
recommendations for streamlining and improving the efficiency and the effectiveness
of the defense acquisition process, and for maintaining and increasing DoD’s
technological advantage (the “Section 809 Panel”).  The Section 809 Panel is continuing its
efforts to reach out to the public for specific input and recommendations to
address its designated goals this summer and continuing into the Fall.  For more information on the Section 809 Panel
and its reports, please click here.

If you are interested in learning more about the
Section 809 Panel’s work and the public bid protest meetings currently
scheduled, or have questions about Federal government contracting or the protest
processes, please contact the head of our government contracts practice, Susan
Warshaw Ebner, sebner@fortneyscott.com.
 Please share this update with members of
your organization who have government contracting responsibilities.