Despite its request to close the pay data reporting portal, Judge Chutkan has ordered EEOC to continue to keep the EEO-1 Component 2 Pay Data Reporting Portal open to allow more filers to submit their pay data.  The Order states, despite the acknowledged expense, that EEOC

must continue to take all steps necessary to complete the EEO-1 Component 2 data collection for calendar years 2017 and 2018 by January 31, 2020.

This includes keeping the reporting portal open until that time or the agency reaches an acceptable reporting threshold.  The Plaintiffs in the case disagree with EEOC as to the measure of completeness and suggest EEOC needs to obtain greater than a 98% response rate to complete the data collection.

The Order also requires EEOC continue to file status reports with the court every 3 weeks.

The Order does not create any new or additional pay data reporting obligations.

At the same time the parties are filing briefs in the pending appeal of Judge Chutkan’s Order which initiated the data collection earlier this year.

Stay tuned for further updates.

As previewed a while ago on the Agency’s Technical Assistance website, OFCCP has released a Technical Assistance Guide for Educational Institutions.  The 80-page guide contains

  • An overview of the equal employment opportunity obligations for federal contractors
  • The required components of affirmative action programs and related information
  • What to expect during an OFCCP compliance evaluation

As part of the Agency’s stated purpose for the guide it recognizes that

due to their complex organization, it is difficult to objectively measure educational institutions’ hiring, promotion, and compensation of instructional staff. These elements may depend on personal factors such as the prestige of publications, research, discipline, and contributions to the institution.

As a result, the agency designed the guide to

assist contractors that are educational institutions to understand their obligations under the laws and regulations OFCCP enforces and to help them prepare for compliance evaluations.

We will be evaluating the contents of the Guide and provide you with additional insights in the coming days.

At a time when the Agency has begun embarking on Section 503 Focused Reviews, OFCCP continues work to prevent discrimination for individuals with disabilities. Last week, as national disability awareness month began, OFCCP quietly published a request to tweak its prescribed disability self-identification form.  The revisions seek to streamline the form and provide additional guidance to applicants and employees asked to complete the form seemingly in the hopes of increasing participation.

Importantly, this year marks the 5 year anniversary of the revisions to the Section 503 regulations, which created, for the first time, the obligation to solicit disability self-identification information from employees and applicants.  Per the revised regulations, after the inaugural data collection, contractors are required to re-survey their employee populations at least once every five years.  Thus, it is likely time for organizations to resurvey if they have not already done so.

Notably, the proposed form:

  • Expands the examples of disabilities to include Autoimmune disorders; Gastrointestinal disorders such as Crohn’s Disease, irritable bowel syndrome and celiac disease; Psychiatric conditions beyond PTSD; and, and Cardiovascular or heart disease.

 

  • Is now one page:  OFCCP proposes to remove the Reasonable Accommodation Notice on page 2 of the current form.

 

  • Provides more information regarding why applicants and employees are asked to complete the form.  For example, “We must make reasonable efforts to have at least 7% of our workforce be individuals with disabilities.”  What this really means is 7% of each AAP job group.

 

  • Apparently expands the “Yes” option from, “YES, I HAVE A DISABILITY (or previously had a disability)” to “YES, I HAVE A DISABILITY, OR HAVE A HISTORY/RECORD OF HAVING A DISABILITY.”

 

OFCCP seeks your comments through December 2, 2019, “including specific suggestions for updating the form and for matching applicants with forms for affirmative action purposes using a method other than name.”

In the next chapter of the pay data reporting saga, the EEOC has filed a Motion with the court seeking an order “determining that the EEO-1 Component 2 data collection is deemed complete.”  The EEOC is reporting that

as October 8, 2019, 75.9% of eligible filers had submitted Component 2 data.

EEOC previously suggested that the reporting be deemed complete once 72.7% of Component 2 reports have been filed.  Thus, by EEOC’s calculations, that benchmark has been achieved.

EEOC has committed to keeping the portal open for 6 weeks past the September 30th deadline – or until November 11, 2019 – but is requesting the Court enter an Order permitting it to close the portal at that time.  It will reportedly cost EEOC $1.5 million to keep the portal open until November 11th and $150,000 per week thereafter.

EEOC reports it has conferred with Plaintiff’s in the matter and they are opposed to the motion as they disagree with EEOC’s calculation of the completion benchmark.  According to the Motion, Plaintiff’s assert the reporting should not be deemed complete until 98.25% of the reports have been received, and the portal should remain open until that time.

The parties must now await action by Judge Chutkan or a ruling in the currently pending appeal of her initial order, which may be more likely.  Stay tuned for further updates.

In its most recent required status report to the court, filed September 27, 2019, the EEOC reports:

[s]o long as the Court’s order is in effect stating that the collection will not be complete until it reaches what the Court has determined to be the target response rate, the EEOC will continue to accept Component 2 data for 2017 and 2018.

The Component 2 filing website has also been updated with the following message:

In a September 27, 2019 Status Report that was filed in the lawsuit discussing post-September 30th activities, the EEOC stated that so long as the Court’s order is in effect stating that the collection will not be complete until it reaches what the Court has determined to be the target response rate, the EEOC will continue to accept Component 2 data for 2017 and 2018. EEO-1 eligible employers should continue to submit and certify their Component 2 EEO-1 reports for 2017 and 2018 as soon as possible.

As an update to its previous report, the EEOC is reporting that as of September 25, 39.7% of eligible filers have completed submission of the Component 2 data.

As soon as additional information is known about how long EEOC expects to continue to collect data we will let you know.

 

In August, OFCCP issued a proposed new rule to clarify aspects of a religious exemption available to federal contractors.  According to OFCCP, the rule is intended to provide clarity regarding the scope and application of the existing religious exemption consistent with the evolving landscape of religious freedom- based legal developments, including Masterpiece Cakeshop, Ltd. v. Colo. Civil Rights Comm’n, 138 S. Ct. 1719, 1731 (2018), Trinity Lutheran Church of Columbia, Inc. v. Comer, 137 S. Ct. 2012, 2022 (2017), Burwell v. Hobby Lobby Stores, Inc., 134 S. Ct. 2751, 2775 (2014), Hosanna-Tabor Evangelical Lutheran Church & Sch. v. EEOC, 565 U.S. 171, 196 (2012). OFCCP stated the holdings of these recent Supreme Court decisions

have reminded the federal government of its duty to protect religious exercise – and not to impede it.

During the recent public comment period, OFCCP received  more than 100,000 comments on the proposed rule, including comments from industry groups and the United States Senate Committee on Health, Education, Labor, and Pensions.  As might be expected, comments both support the additional religious protections and voice concerns regarding its appropriateness and certainty of application.  The most developed criticisms of OFCCP’s proposed new rule focus on the potential expansion of applicability and the proof standard required to show unlawful discrimination.

Who does the proposed rule cover?

Under the proposed rule, any contractor that is “organized for a religious purpose” (even if it is not the contractor’s only purpose), holds itself out to the public as carrying out a religious purpose (even if the employer only does so in response to an inquiry from OFCCP), and “exercises religion consistent with, and in furtherance of, a religious purpose” can claim the proposed religious exemption.  According to critics, this is a burdensome, fact intensive, and complicated legal analyses of areas of law with which judges often struggle.  Yet, OFCCP’s proposed rule would charge field personnel with such nuanced assessments.

Critics also point out that this test goes beyond the current Supreme Court precedent on the interplay between the (potentially competing) Constitutional rights of (1) free exercise of religion and (2) to be free from discrimination.  Once commentator suggested that OFCCP should delay any new rule on a religious exemption until the Supreme Court decides three cases this term that address whether sexual orientation and gender identity are protected classes under Title VII.

However, advocates cite to the many “critical services” provided by faith-based organizations, such as aid for the homeless and victims of abuse and praise the proposed rule’s efforts to level the playing field and increase participation in essential sectors of American life. Others point to freedom of religion as “America’s backbone,” and commend the commitment to allow employers to operate their businesses consistent with sincerely held religious tenets.  Still others simply “appreciate the clarity” of the exemption.

How would OFCCP establish unlawful discrimination?

Currently, any employment decision in which discrimination is “a motivating factor” is prohibited.  But under the new rule, OFCCP would have to establish that discrimination on a protected basis other than religion was the “but for” cause of the employment action.  According to critics, this distinction would make it substantially more difficult to establish that employment discrimination occurred and would enable employers claiming the exemption to use religion as a pretext for unlawful decisions.

What would the new rule protect?

Comments also requested additional clarity on the scope of the exemption.  The OFCCP expressed in the proposed rule’s executive summary that many faith-based organizations have apparently been reluctant to, or historically entirely refrained from, contracting with the federal government out of concern surrounding uncertainty of the scope of the existing exemption. As discussed above, the revised language is intended to capture employers well beyond houses of worship in an effort to encourage participation in their respective industries.

While much of the ire drawn by the proposed rule is the risk at which it places protection due to sexual orientation and gender identity at risk, its impact may not end there.  For example, the National Industry Liaison Group asks:

[W]ill it permit allegedly ‘illegal’ questions during an interview process and allow an employer to decline to hire a woman who has been divorced, had an abortion, or is living with another in an unmarried state?  In the normal operation of a business, will a male be promoted over a female because males in the organization refuse to be alone with the female for training and mentoring purposes, denying females developmental opportunities?  Simply stated, will ‘sincerely’ held religious beliefs overcome anti-discrimination protections afforded female employees?

*             *             *

The public is divided on the issue, and some serious questions remain.  The ball is back in OFCCP’s court to consider this swell of public feedback.  When it does, we’ll keep you posted.

Since the Government Accountability Office (GAO) issued its Recommendations to Strengthen the Office of Federal Contract Compliance Programs’ Oversight of Federal Contractors’ Nondiscrimination Compliance in July 2016, OFCCP has taken steps to implement its recommendations.  And now, the GAO has issued a progress report evaluating OFCCP’s actions toward the 2016 recommendations.

The GAO’s progress report provides insight into both OFCCP’s past and future actions that often occur outside of public view.  Looking backward, the GAO concluded that OFCCP has successfully implemented changes to address the following recommendations:

  1. Make changes to the current scheduling list distribution process so that it addresses changes in human capital and does not rely exclusively on geographic location.
  2. Review outreach and compliance assistance efforts and identify options for improving information provided to federal contractors and workers to enhance their understanding of nondiscrimination and affirmative action requirements to ensure equal employment opportunities for protected workers.
  3. Assess existing contractor guidance for clarity to ensure that contractors have information that helps them better understand their responsibilities regarding nondiscrimination and affirmative action requirements to ensure equal employment opportunities for protected workers

Yet, the GAO found that OFCCP fell short in meeting three other of its 2016 recommendations:

  1. Make changes to the contractor scheduling list development process so that compliance efforts focus on those contractors with the greatest risk of not following equal employment opportunities and affirmative action requirements.
  2. Develop a mechanism to monitor affirmative action plan from covered federal contractors on a regular basis. Such a mechanism could include electronically collected AAPs and contractor certification of annual updates.
  3. Provide timely and uniform training to new staff, as well as provide continued training opportunities to assist compliance officers in maintaining a level of competence to help ensure quality and consistency of evaluations across regions and district offices.

The report also includes additional guidance for OFCCP to continue its implementation of the 2016 recommendations.  For example, to continue to refine its selection methodology to reduce the impact of its prior methodology and to evaluate how the Voluntary Enterprise-wide Review Program (VERP) may impact the pool of contractors for selection.

But perhaps most surprising is the disclosure in the report that OFCCP is poised to issue a request that OMB approve that contractors submit their AAPs annually to OFCCP.  According to the GAO,

OFCCP has contracted with an information technology vendor to develop a web-based portal to allow contractors to upload their AAPs electronically for convenience, increased compliance, and for OFCCP review.

According to the report, the Agency intends to announce this technology by September 30, 2019.  The report also states

OFCCP has developed the necessary information collection request to obtain approval from OMB to collect all contractors’ AAPs annually. The agency anticipates that OMB approval will be timely to align with completion of the AAP portal.

The details of this are still unknown, but September 30 is fast approaching, as those of you with EEO-1 Component 2 filing obligations are well aware.  We will be sure to provide updates as we learn more.

As we previously reported , EEOC has filed notice asking for renewed approval to collect EEO-1 Component 1 race, gender and ethnicity workforce data for the next three years (2019, 2020 & 2021), but is not seeking renewed authority to collect Component 2 pay data and hours worked. To be clear, this filing does not impact the current obligation employers have to submit 2017 and 2018 pay data by September 30, 2019.

EEOC’s authorization to collect any EEO-1 data (Component 1 or Component 2) expires on September 30, 2019.  Thus, the Agency has submitted the current information request because it needs approval to continue to collect Component 1 data.  Confusingly, Judge Chutkan ordered in National Women’s Law Center, et al. v. Office of Management and Budget, et al., that EEOC’s authority to collect Component 2 pay data will expire no later than April 5, 2021.  This Order, however, is currently at the center of a legal appeal.  But for the court’s order, or in the event the court’s order is overturned on appeal, EEOC’s authority to collect Component 2 data will likewise expire on September 30, 2019.

As a result of the two expiration dates, and the pending litigation, EEOC is asking the Office of Management and Budget (OMB) to separate approval of Component 1 data collection from Component 2 collection so it can continue to collect Component 1 data while it takes time to assess the utility and burden associated with the Component 2 collection.

According to its notice, EEOC has serious doubts about the previously reported burden on employers to collect and file Component 2 data.  It seems EEOC has discovered the previous burden estimate was

an extremely low estimate of the burden on employers. . . EEOC now concludes the burden estimate associated with the EEO-1 is higher than it has previously estimated.

Because it is concerned the actual burden may outweigh the value of the data, the Agency has elected to pause so it can “balance the utility of the data to its enforcement programs against the burden the data collection as structured imposes on the employers who must submit it.”

Therefore,

[t]he Commission now concludes that it should consider information from the ongoing Component 2 data collection before deciding whether to submit a pay data collection to OMB. At this point in time, the unproven utility to its enforcement program of the pay data as defined in the 2016 Component 2 is far outweighed by the burden imposed on employers that must comply with the reporting obligation. Therefore, the EEOC is not seeking to renew Component 2 of the EEO-1.

This admission does not, however, mean EEOC has necessarily made any decision regarding whether it will collect some form of Component 2 data going forward.  However, it appears EEOC will not seek approval to collect any additional Component 2 pay data in the near future, either pursuant to its existing authority or pursuant to approval following a new request for OMB approval.  Rather, EEOC’s notice suggests it will take a step back, analyze the 2017 and 2018 to determine if and how it might efficiently collect valuable employer pay data without unduly burdening employers, and then move forward from there.  How long it may take EEOC to sort this all out is, at this point, anyone’s guess.

Please check back for updates as the saga of EEO-1 Component 2 reporting continues at EEOC, OMB and the courts.

As previously reported, EEOC is expected to publish tomorrow a Notice of Information Collection regarding EEO-1 Reporting.  An advance copy of the notice reports that

the EEOC is not seeking to renew Component 2 of the EEO-1.

Instead, the Commission has concluded it should consider information from the current Component 2 collection before deciding whether to submit a renewed pay data collection to OMB for approval.  The Agency feels

at this point in time, the unproven utility to its enforcement program of the pay data as defined 2016 Component 2 is far outweighed by the burden imposed on employers that must comply with the reporting obligation.

While the EEOC has decided not to seek extension of Component 2 at this time, it does intend to continue to collect Component 1.

This is a developing story – we will be back soon with more details.

In its required status report, filed pursuant to Court Order, EEOC announced it is preparing a Notice of Information Collection – Employer Information Report (EEO-1) to seek authorization from the Office of Management and Budget (OMB) for the collection of pay data going forward.  As a reminder, OMB approval for the data collection expires September 30, 2019 – the same deadline imposed by the court for the current reporting period for the EEO-1 Component 2 data. Once published in the Federal Register, EEOC states “the public will be invited to submit comments to the Commission.”  Almost assuredly, the Notice will request employers submit information regarding the utility and burden associated with the data collection, as EEOC Commissioner Vicki Lipnic recently discussed.

EEOC also reported that approximately 13.4% of eligible filers have already submitted their pay data.  In a previously filed, interim report, EEOC suggested the filing threshold should be deemed complete, and the Court’s Order for collection of the data deemed satisfied, once EEOC received data from 72.7% of eligible filers.  According to EEOC, there are approximately 37,000 filers “who have neither contacted the NORC Component 2 Help Desk, registered for access to the online portal, or submitted data.”  The Agency reported it will begin attempting to contact these filers via phone.

As always, we will continue to monitor any new developments in this area and provide updates with any new information.