To provide another opportunity to receive input on the Agency’s proposed revisions to the EEO-1 report, EEOC has scheduled a public hearing on the matter for November 20, 2019. The notice comes as EEOC has been ordered to continue with collection of Component 2 of the EEO-1 Report for 2017 and 2018 beyond expiration of the original data collection deadline.

As a reminder, the EEOC has filed for renewed approval for the continued collection of EEO-1 Component 1 race, gender and ethnicity workforce data for the next three years (2019, 2020 & 2021).  While EEOC plans to continue to collect Component 1 data, it reported that it is not seeking renewed authority at this time to collect Component 2 pay data and hours worked.  In furtherance of this, EEOC is seeking to decouple the Component 1 form from the pay data reporting of Component 2.

The hearing is intended to allow the Commission “hear from panels of experts, representing a diverse range of different views” on the proposed changes to the reports and is seen as part of the agency’s evaluation of the future of pay data reporting.

The hearing, which will be held in Washington, D.C. will be open to the public on a first come, first serve basis.  The public also has until November 12, 2019 to file comments in response to the Agency’s pending renewal notice.

 

Following the most recent Court Order, EEOC has provided the court with a current update as to its compliance with the Court’s Order that it continue to keep the EEO-1 Component 2 pay data reporting portal open.  The Court has ordered the portal remain open until at least January 31, 2020 to allow additional filers to submit their reports.

In its report EEOC detailed the efforts made to contact companies that have not yet completed their filings as well as the updated notice now posted on the EEO-1 Component 2 filing website that the portal will remain open.

As of November 1, EEOC is reporting

82.4% of eligible filers have completed submission of Component 2 EEO-1 data.

The Agency also reported that it “continues to receive a small number of requests from filers seeking exemptions from reporting” and the Commission is holding Commissioner votes on whether to grant the exemptions.

Per the Courts Order, EEOC will be required to continue to submit regular updates to the Court until the filing is complete.

 

 

The Technical Assistance Guide for Educational Institutions (the “Guide”) OFCCP released recently is largely a review of existing standards and regulations, but it also includes suggested best practices and concrete guidance specific to educational institutions.

The complete document is available with other guidance on OFCCP’s Technical Assistance website. A summary follows.

Since releasing the Guide, Director Craig Leen and other Agency officials have spoken about it publicly, most recently at its Academic Institutions Town Hall in Washington D.C., and a listening session with the American Association for Access, Equity, and Diversity. In those sessions, they said colleges and universities can expect compliance reviews to be more efficient than in the past, and to start seeing institutions scheduled for review beginning in Spring 2020.

Overview of Laws

The Guide includes an overview of laws enforced by OFCCP, and reminds contractors of “two general rules” —

  • Do not discriminate against applicants or employees based on protected categories; and
  • Take affirmative action to a) ensure equal employment opportunity without regard to race, color, religion, sex, sexual orientation, gender identity, or national origin; and b) to employ and advance qualified individuals with disabilities and protected veterans.

Affirmative Action Programs and Standards

The Guide includes an overview of what contractors must include in their Affirmative Action Programs: Organizational Profile (“Workforce Analysis”), Job Group Analysis, Availability, Placement Goals, the VEVRAA Hiring Benchmark, Section 503 Utilization for Individuals with Disabilities, Outreach, and Compensation, to name a few.

These are regulatory requirements and not new to contractors. However, the Guide does provide some education-specific insights. For example —

  1. Single or Multiple AAPs? The Guide provides that, where a campus includes a collection of buildings, either a single AAP or multiple establishment AAPs might be appropriate. Specifically, where a campus has various schools, colleges or departments that:
  • Operate distinctly, have limited employee interaction, and have different human resources departments, separate AAPs are likely appropriate.
  • Share instructional staff, and the operations of the units are more interconnected, a single establishment AAP is likely appropriate.

 

  1. Is a Worker an “Employee”? The Guide discusses whether educational institutions should count as employees, and therefore include in their AAPs, medical residents and student workers, for example.
  • OFCCP will consider whether the individual’s primary relationship with the institution is work-related. The Guide reminds educational institutions that OFCCP will not issue violations for excluding student workers from AAPs or personnel activity data, pointing to OFCCP’s Directive 2019-05, issued in September.
  • The Guide, like the 2019 Directive, also pointed institutions to the Darden test from the U.S. Supreme Court to determine whether an individual with a relationship to the institution qualifies as an employee.

 

  1. What are Appropriate Pay Analysis Groups? Consistent with OFCCP’s trend to make larger pay groupings then account for differences in duties by introducing variables, the Guide provides:
  • “Because tenure-track instructors have similar job functions and duties,” they can be included in the same pay analysis group, then variables introduced to a regression analysis to control for differences (contractors may not agree with this approach).
  • Variables such as the quality of teaching, publications, research, and community service should be included in the regression “only when they can be objectively and neutrally measured.”

Compensation in a Compliance Review

In the Guide, OFCCP discusses issues unique to tenure or tenure-track instructors, in contrast with issues involving non-tenure track instructors. The Guide also provides example questions it may ask during a compliance review. For example:

  • How does the institution conduct its own compensation analysis?
  • What and who determines the pay of professors, professional lecturers, instructors, and other teaching positions?
  • What are the sources of funding for grants and how do they influence base salaries?
  • What criteria are used to issue awards or honors that impact compensation?
  • How do 9-month and 12-month contracts differ, and what determines their availability?
  • How are tenure promotions reviewed for neutrality and by whom?

Religious Exemption

The Guide clarifies that religious colleges and universities are permitted to make employment decisions based on religious if the institution is, in whole or substantial part:

  • Owned, supported, controlled, or managed by a particular religion or by a particular religious corporation, association, or society; or
  • If the curriculum of such educational institution is directed toward the propagation of a particular religion.

The guidance cites to, and is consistent with, OFCCP’s Directive 2018-03. We provided further context for the Directive in this August 2018 post.

“Specialty Areas” Unique to Educational Institutions

The Guide addresses three “specialty areas” that may surface in compliance reviews of educational institutions: Athletics, Medical, and Online Institutions, and offers insights as to how the contractor – and OFCCP – might approach them.

  1. Athletics

The Guide states that “many specialized factors” (the market, revenue from conference sources, etc.) affect compensation and promotional opportunities for coaches and athletic directors. The Guide says should address such factors in their AAP. (Addressing these in the written AAP is not required by OFCCP regulations.) For example:

  • The existence of written contracts designating job responsibilities and salaries;
  • The level at which performance reviews and merit increases are determined (decisions made by head coaches? Athletic directors?);
  • Whether the physical size of the program plays a role in compensation; and
  • Whether revenue from the program or reputation of the program affects compensation of coaches and directors.
  1. Medical

The Guide recognizes that compensation of medical personnel can be dependent on specific discipline, and encourages contractors to track in their data “major work areas, such as teaching, clinical, or research duties.”

  1. Online Institutions

The Guide acknowledges that, increasingly, institutions function partially or entirely as online schools. These schools may have a majority of instructors who are not full-time employees. It lists practices OFCCP says “the institutions should ensure that its AAP addresses . . .” They include:

  • Define terms such as “faculty, core faculty, and contributing faculty”;
  • Detail recruitment and selection procedures for all staff, especially instructional positions;
  • Detail relevant compensation factors, especially for instructional positions; and
  • Annotate in the Workforce Analysis and Job Group Analysis the actual locations of remote and telework employees.

Again, these are issues that may be relevant in a compliance review, but there is no regulatory obligation to include them in the written AAP.

We will continue to provide updates on OFCCP enforcement trends related to educational institutions.

In an Executive Order issued yesterday, President Trump revoked Obama-Era Executive Order 13495, which provided some protection – a right of first refusal for continued employment – to qualified service workers when a government contract was replaced with a new contract and successor contractor at the same location.  President Trump’s Executive Order provides no explanation for the revocation, but the move was likely influenced by the new Secretary of Labor, Eugene Scalia.

Executive Order (EO) 13495 and its implementing regulations, applied to any contract or subcontract for services entered into by the Federal Government or its contractors covered by the McNamara-O’Hara Service Contract Act.  It required that qualified workers (non-exempt workers covered by the SCA’s requirements) on a covered contract who stood to lose their jobs due to the completion or expiration of a contract be given a right of first refusal for employment with the successor contractor.  Generally, the successor contractor was prohibited from hiring any new employees under the successor contract until qualified workers performing the prior contact were provided the opportunity to accept a job with the successor.  However, EO 13495 applied only to successor contracts for the performance of the same or similar services at the same location.

The revoked Order required the predecessor contractor to provide written notice to eligible employees either via a conspicuous workplace posting or via notices delivered to the employees individually. Federal contractors are no longer required to post or provide any EO 13495 notices. Please note this revocation does not affect contractor obligations with respect compliance with Executive Order 13496.

President Trump’s Order requires the Labor Secretary and others to “promptly move to rescind any orders, rules, regulations, guidelines, programs, or policies implementing or enforcing Executive Order 13495.”  Significantly, the Order terminates immediately any existing investigations or compliance actions based on EO 13495.

You may recall the President has revoked other Executive Orders entered by President Obama, including the “Blacklisting” Order. and there may be more to come.

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.