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OFCCP Gets Tough Presentation

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How the Obama Administration has re-shaped the OFCCP into an aggressive enforcement arm of affirmative action and nondiscrimination compliance, and what it all means for your organization.

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OFCCP Gets Tough Presentation

  1. 1. HR Hero Audio Conference August 12, 2010 OFCCP Gets Tough : Prepare for Aggressive Affirmative Action Nondiscrimination Enforcement Dean R. Singewald II, Esq. Epstein Becker & Green, P.C. One Landmark Square, Suite 1800 Stamford, Connecticut 06901 [email_address] (203) 326-7410 © 2010 Epstein Becker & Green, P.C.
  2. 2. Introductory Statement <ul><li>The materials contained in this power point presentation and the oral presentation are provided for informational purposes only and are not intended and should not be construed to constitute legal advice. Please consult with legal counsel in connection with any fact-specific situation under federal law and the applicable state or local laws that may impose additional obligations on you and your company. </li></ul>1
  3. 3. About EpsteinBeckerGreen <ul><li>Epstein Becker & Green, P.C. is an AmLaw 200 national law firm with approximately 325 lawyers practicing in 11 offices, in Atlanta, Boston, Chicago, Houston, Los Angeles, Miami, New York, Newark, San Francisco, Stamford, and Washington, D.C. </li></ul><ul><li>With Washington insider knowledge and more than 35 years of experience in health care and labor and employment law, the Firm is eminently prepared to guide clients through this era of reform. Other practice areas include employee benefits, litigation, immigration, real estate, and business law. </li></ul><ul><li>The Firm has a longstanding history of being a trusted advisor to clients in the health, hospitality, financial services, and energy industries, among others, representing entities from small entrepreneurial ventures to large multinational corporations on a worldwide basis. For more information, visit www.ebglaw.com. </li></ul>2
  4. 4. Affirmative Action/OFCCP Compliance Practice <ul><li>Epstein Becker & Green, P.C. has a long standing and substantial Affirmative Action/OFCCP Compliance Practice. We regularly provide advise and counsel regarding the obligations of government contractors. </li></ul><ul><li>We assist clients in their efforts to engage in affirmative action to ensure non-discrimination in employment and, toward that end, assist them in the preparation and implementation of their Affirmative Action Programs (AAPs). We prepare plan documents, and analyze compensation and personnel activity data to determine compensation disparities and adverse impact by gender, race and ethnicity. We also regularly provide guidance to and defend clients subject to compliance reviews conducted by the Office of Federal Contract Compliance Programs (OFCCP). </li></ul>3
  5. 5. About Dean Singewald, Esq. <ul><li>Dean Singewald represents employers in all facets of labor relations and employment law, including affirmative action and equal employment opportunity (EEO) compliance. Dean regularly advises government contractors on their affirmative action and EEO compliance obligations. He assists contractors in the preparation and implementation of their AAPs, prepares plan documents, conducts impact ratio and compensation analyses to identify and resolve potential adverse impact and compensation disparity discrimination liability, and provides guidance to and defends contractors during OFCCP compliance reviews. </li></ul><ul><li>Dean also counsels management on a wide range of corporate diversity matters ranging from crisis prevention and management to enhancing corporate diversity performance, and provides training concerning EEO issues, including affirmative action, diversity, and harassment prevention. </li></ul>4
  6. 6. Agenda <ul><li>OFCCP Takes Aggressive Stance to Ensure Compliance </li></ul><ul><li>Compliance Review of ARRA Contractors </li></ul><ul><li>Cap on Compliance Reviews Eliminated </li></ul><ul><li>Increased Focus on Covered Veterans and Disabled Individuals </li></ul><ul><li>Recent Developments </li></ul><ul><li>Questions & Answers </li></ul>5
  7. 7. <ul><li>OFCCP Takes Aggressive Stance to Ensure Compliance: </li></ul><ul><li>How the Obama Administration has re-shaped the OFCCP into an aggressive enforcement arm of affirmative action and nondiscrimination compliance, and what it all means for your organization </li></ul>6
  8. 8. OFCCP Takes Aggressive Stance to Ensure Compliance <ul><li>Obama Administration has re-shaped the OFCCP: </li></ul><ul><li>OFCCP now reports directly to Secretary of Labor </li></ul><ul><li>33% increase in funding from FY 2009 to FY 2010 </li></ul><ul><li>Additional $27.4 million in funding is being used to: </li></ul><ul><ul><li>Develop a new case management system </li></ul></ul><ul><ul><li>Hire 213 additional compliance officers and other enforcement personnel </li></ul></ul><ul><ul><li>Increase the number of compliance evaluations and complaint investigations </li></ul></ul><ul><ul><li>Bolster the agency’s enforcement strategies </li></ul></ul>7
  9. 9. OFCCP Takes Aggressive Stance to Ensure Compliance <ul><li>OFCCP’s renewed and expanded focus: </li></ul><ul><li>“ Good faith efforts” in outreach and recruitment </li></ul><ul><ul><li>Renewed focus on minorities and women </li></ul></ul><ul><ul><li>Expanded focus on veterans and disabled individuals </li></ul></ul><ul><ul><li>Expanded focus includes whites, men and individual minority groups </li></ul></ul><ul><li>Serious about eliminating systemic discrimination </li></ul><ul><ul><li>Hiring disparities </li></ul></ul><ul><ul><li>Tracking applicant flow crucial </li></ul></ul><ul><li>Aggressive enforcement stance regarding contractors’ pay practices </li></ul><ul><ul><li>Compensation disparities </li></ul></ul><ul><ul><li>“ No more sweetheart deals” </li></ul></ul>8
  10. 10. <ul><li>Compliance Review of ARRA Contractors : </li></ul><ul><li>How the OFCCP is targeting contractors who are recipients of funds from the American Recovery and Reinvestment Act (ARRA) </li></ul>9
  11. 11. Compliance Review of ARRA Contractors <ul><li>New directive issued : </li></ul><ul><li>Subjects all ARRA-funded contractors to pre-award clearance evaluations </li></ul><ul><ul><li>Pre-award clearance evaluations of ARRA contractors are not limited to those contractors seeking contracts exceeding $10 million </li></ul></ul><ul><li>Full compliance review, with desk audit and on-site evaluations to be conducted </li></ul><ul><ul><li>Active Case Management procedures setting forth tiered compliance evaluation process will not be followed when reviewing ARRA contractors </li></ul></ul><ul><li>All contractors on an ARRA-funded construction project is subject to a compliance review </li></ul>10
  12. 12. <ul><li>Cap on Compliance Reviews Eliminated: </li></ul><ul><li>Revisions to the Corporate Scheduling Announcement Letter could expose your organization to unlimited compliance reviews </li></ul>11
  13. 13. Cap on Compliance Reviews Eliminated <ul><li>Corporate Scheduling Announcement Letter revised: </li></ul><ul><li>No longer limiting the number of facilities that may be subject to a compliance review in any scheduling cycle </li></ul><ul><ul><li>Previously limited to no more than 25 facilities a year </li></ul></ul><ul><li>May eliminate letter altogether </li></ul><ul><li>Letter provides contractors opportunity to prepare or review their facilities’ AAPs before receiving notice from the OFCCP initiating a compliance review </li></ul><ul><ul><li>Contractors able to address potential vulnerabilities in advance of compliance review </li></ul></ul>12
  14. 14. <ul><li>Increased Focus on Covered Veterans and Disabled Individuals: </li></ul><ul><li>OFCCP providing greater scrutiny </li></ul><ul><li>Avoiding violations for lack of outreach </li></ul><ul><li>Possible regulation revisions </li></ul>13
  15. 15. Increased Focus on Covered Veterans and Disabled Individuals <ul><li>OFCCP providing greater scrutiny </li></ul><ul><li>Outreach and positive recruitment of both covered veterans and disabled individuals </li></ul><ul><ul><li>Demanding detailed information on the number of applicants referred by veteran and disabled recruitment sources and the number hired </li></ul></ul><ul><ul><li>Onus now on contractors to not only use veteran and disabled recruitment sources, but also to monitor the referrals and hires from those sources </li></ul></ul><ul><ul><li>Similar scrutiny regarding minorities and women </li></ul></ul><ul><li>Workplace accessibility for disabled individuals </li></ul><ul><li>Workplace accommodations provided </li></ul>14
  16. 16. Increased Focus on Covered Veterans and Disabled Individuals <ul><li>Avoiding violations for lack of outreach </li></ul><ul><li>Contractors need to: </li></ul><ul><ul><li>Regularly list job openings with: </li></ul></ul><ul><ul><ul><li>Minority and women recruitment sources </li></ul></ul></ul><ul><ul><ul><li>Veteran and disabled recruitment sources </li></ul></ul></ul><ul><ul><ul><li>State employment services </li></ul></ul></ul><ul><li>Record referral source information for applicants referred by recruitment sources </li></ul><ul><li>Monitor the number of applicants referred by these sources and the number hired </li></ul><ul><li>Document affirmative action taken </li></ul>15
  17. 17. Increased Focus on Covered Veterans and Disabled Individuals <ul><li>Possible regulation revisions </li></ul><ul><li>OFCCP announced plans to develop affirmative action statistical analyses for covered veterans and disabled individuals similar to the statistical analyses for minorities and women </li></ul><ul><ul><li>Advanced Notice of Proposed Rulemaking issued seeking feedback on 18 issues in order to strengthen EEO and affirmative action obligations for disabled individuals </li></ul></ul><ul><li>OFCCP seeking input regarding “good faith effort” best practices and how to make affirmative action obligations towards covered veterans and disabled individuals more successful </li></ul>16
  18. 18. <ul><li>Recent Developments : </li></ul><ul><li>Affirmative action obligations that contractors must meet now and other developments </li></ul>17
  19. 19. Recent Developments <ul><li>OFCCP focus on applicants and new hires to determine if adverse impact exists by gender and race/ethnicity </li></ul><ul><ul><li>Traditionally, focus on treatment of women and minorities </li></ul></ul><ul><ul><li>Expanded focus now on treatment of men, whites and individual minority groups </li></ul></ul><ul><ul><li>Adverse impact analysis – hires, promotions and terminations </li></ul></ul><ul><ul><ul><li>If adverse impact, then individual components of selection process evaluated for adverse impact – see Uniform Guidelines on Employee Selection Procedures </li></ul></ul></ul><ul><ul><li>Tracking applicants: </li></ul></ul><ul><ul><ul><li>Internet Applicant Rule </li></ul></ul></ul><ul><ul><ul><li>Use of detailed disposition codes </li></ul></ul></ul><ul><ul><ul><li>Data management techniques </li></ul></ul></ul>18
  20. 20. Recent Developments <ul><li>OFCCP focus on compensation data to determine if compensation disparities exist by gender and race/ethnicity </li></ul><ul><ul><li>Same expanded focus </li></ul></ul><ul><ul><li>National Equal Pay Enforcement Task Force Report </li></ul></ul><ul><ul><li>Tipping Point Test </li></ul></ul><ul><li>Executive Order 13496 </li></ul><ul><ul><li>Requires contractors to notify employees of their rights under the National Labor Relations Act </li></ul></ul><ul><ul><li>Applies to contractors that enter into new or modified contracts on or after June 19, 2010 </li></ul></ul>19
  21. 21. Recent Developments <ul><li>Dodd-Frank Wall Street Reform and Consumer Protection Act </li></ul><ul><ul><li>Requires federal financial agencies to establish an “Office of Minority and Women Inclusion” </li></ul></ul><ul><ul><li>Office responsible for all matters “relating to diversity in management, employment, and business activity” </li></ul></ul><ul><li>OFCCP v. UPMC Braddock </li></ul><ul><ul><li>Contractor not excused from compliance obligations if contract fails to contain or reference equal opportunity clause </li></ul></ul><ul><ul><ul><li>Equal opportunity clause incorporated by operation of law </li></ul></ul></ul><ul><ul><li>Hospitals that provide services which are necessary to the performance of an HMO health plan’s contract to provide medical supplies and services to government employees have compliance obligations </li></ul></ul><ul><ul><ul><li>OFCCP v. Bridgeport Hospital distinguished </li></ul></ul></ul>20
  22. 22. Recent Developments <ul><li>OFCCP v. Frito-Lay Inc. </li></ul><ul><ul><li>US DOL Administrative Law Judge ruled that OFCCP cannot obtain employment records relating to hiring decisions occurring after the date the contractor is notified the OFCCP is initiating a compliance review </li></ul></ul><ul><ul><ul><li>Reviews may not analyze new data going forward </li></ul></ul></ul><ul><ul><li>ALJ’s recommendation to dismiss the complaint now pending before the US DOL Administrative Review Board </li></ul></ul><ul><li>Use of Functional AAP suspended </li></ul><ul><ul><li>No longer able to develop or renew existing FAAPs </li></ul></ul><ul><ul><li>OFCCP to issue new guidelines </li></ul></ul><ul><li>2006 Systemic Pay Discrimination Guidelines to be rescinded </li></ul><ul><ul><li>OFCCP to issue new guidelines </li></ul></ul>21
  23. 23. Questions & Answers 22
  24. 24. HR Hero Audio Conference August 12, 2010 OFCCP Gets Tough : Prepare for Aggressive Affirmative Action Nondiscrimination Enforcement Dean R. Singewald II, Esq. Epstein Becker & Green, P.C. One Landmark Square, Suite 1800 Stamford, Connecticut 06901 [email_address] (203) 326-7410 © 2010 Epstein Becker & Green, P.C.

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