To follow up on our report last month, President Obama has signed an Executive Order requiring federal contractors to give their workers the ability to earn up to seven days (56 hours) of paid sick leave each year.  The executive order will go into effect on January 1, 2017 and instructs the U.S. Secretary of Labor to issue regulations to implement the executive order by September 30, 2016.

The Order will apply to employees whose wages are governed by the Davis-Bacon Act, the Service Contract Act or the Fair Labor Standards Act, including those that qualify for minimum wage and overtime exemptions under the FLSA.

For these covered employees, the Order will apply to new contracts or contract-like instruments, as defined by the Secretary of Labor in the regulations, if the contract is:

  1. a procurement contract for services or construction;
  2. a contract or contract-like instrument for services covered by the Service Contract Act;
  3. a contract  or contract-like instrument for concessions, including any concessions contract excluded by Department of Labor regulations;
  4. a contract or contract-like instrument entered into with the Federal Government in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public.

Other details of the Order include:

  • An hour of paid leave is earned for every 30 hours of work
  • Leave can be used care for the worker or family members;
  • Unused leave can carry over from year to year;
  • Unused leave will be reinstated for employees rehired by a covered contractor within 12 months after a job separation;
  • Payment for unused leave upon job separation is not required

The Order also explicitly states “it does not supersede other federal, state, or local laws or collective bargaining agreements that provide greater benefits.”

Stay tuned for updates on proposed regulations and what will sure to be other developments in this area.

 

 

As we previously reported, the annual EEO-1 Reporting portal has opened and along with it some changes to the reporting requirements.  Probably the most impactful change is the new requirement that companies may no longer file more than one EEO-1 report for the same address if the North American Industrial Classification System Code (NAICS) is the same for more than one of the entities.   In other words, if your company has multiple entities at the same address and those entities, while legally distinct, engage in the same services, activities or product development you must now file a single consolidated report. For companies with complex organizational structures and/or significant acquisitions, this will require detailed review and assessment of your filings.

There is a mechanism for requesting a variance from this requirement, however the company will need to provide a basis to support the claim of an “undue hardship” which may require detailed company structure information to be submitted to the Commission for review.

In any respect, given all of the changes with this year’s reporting process and procedures, employers cannot wait to the last minute to prepare their reports and should be working to get them finalized now.

 

 

Last week in a divide opinion the National Labor Relations Board decided the case of Browning-Ferris Industries of California, Inc., in which the Board announced a new standard for determining joint employer status under the National Labor Relations Act.  The Board’s decision significantly broadens the definition of “employer” under the Act to include unrelated companies that might share some direct or even indirect control over each other’s workforce. This is particularly prudent to those employers who utilize contract or temporary labor, as many government contractors do.

As OFCCP (and EEOC) continually to focus on the relationship between employers and temporary labor (specifically the use of staffing agencies), this NLRB decision is just the latest reason why contractors need to investigate and understand their contracts with third-party employers and the resulting implications on the employer-employee relationship.

Members of the Jackson Lewis Labor and Preventive Practices Group have digested the opinion and prepared an article setting out in more detail the implications of this decision.  They will also be presenting webinar on September 9th at 3 pm Eastern  to discuss this latest development for employers and to provide practical tips for evaluating current employment relationships.

 

 

In addition to filing annual VETS-4212 reports, federal contractors with 50 or more employees and $50,000 or more in contracts (and non-government contract employers with more than 100 employees) must file annual EEO-1 surveys.   The reporting portal for filing the EEO-1 reports opened today and will remain open until at least September 30.

Employers need a login and password in order to access the site and upload the required information.  The EEO-1 Joint Reporting Committee is reaching out to all past filers to provide them with the login ID for 2015 filing.  New this year, the notification letter no longer contains the reporting password; employers will need to “get password” to retrieve this information this year.  If you believe you should have received this notification and have not, you can contact the Committee at  1-877-392-4647 (toll-free) or email at e1.techassistance@eeoc.gov.

Additionally, employers now have the ability to reset their passwords through a “forgot password” link on the site.  In years past, employers had to contact the Committee to obtain this information.

Finally, a new requirement this year is the inclusion of the Employer Identification Number (EIN) on the reports. While this information is required for employers filing VETS-4212 reports, it has not been previously required for EEO-1 reporting purposes.  This additional data field may require employers update the pre-queried reports pulled out of HRIS systems, which may be time-consuming and costly for some organizations and likely cannot be implemented this reporting season.  As a result, manual modification of the reports may be required so make sure to plan accordingly.

Adding to the line of other states, Illinois now joins the ranks of jurisdictions that allows for employers to establish a voluntary veteran hiring preference.   The Illinois state bill becomes effective January 1, 2016.

The other 20 states that have previously passed similar laws include:

  • Arkansas
  • Arizona
  • Florida
  • Georgia
  • Iowa
  • Idaho
  • Indiana
  • Kentucky
  • Maine
  • Massachusetts
  • Michigan
  • Minnesota
  • Montana
  • North Dakota
  • Nebraska
  • Oklahoma
  • Oregon
  • South Carolina
  • Utah
  • Washington

 

Adding to its growing list of available educational tools, OFCCP has published a new “InfoGraphic” to assist veterans determine whether they are covered under the Vietnam Era Veteran Readjustment Assistance Act (VEVRAA).

Developed in response to requests from the veteran community, the Agency’s new tool does not provide any new information or modify any obligations but instead sets out the statutory definitions of the four protected veteran categories to assist veterans ascertain whether they are afforded protections under the regulations.  The four categories of protected veterans are:

  • Disabled
  • Recently Separated
  • Active Duty Wartime or Campaign Badge
  • Armed Forces Service Medal

Under the recently revised VEVRAA regulations, covered employers are required to solicit veteran status from applicants during both the application stage as well as at the post-offer phase of the hiring process.  Covered employers are also required to file annual VETS-4212 reports reflecting the number of protected veteran employees and new hires in their workforces.

As a continuation of its recent education and outreach efforts, OFCCP released a Checklist for Compliance with Section 503 of the Rehabilitation Act of 1973.   The checklist was developed by the U.S Department of Labor’s Office of Disability Employment Policy (ODEP) and covers obligations under Subpart C of the revised Section 503 regulations.

The checklist is not required and employers are cautioned (multiple times) that using the checklist “does not guarantee or equate to compliance” with Section 503 regulations.

Shortly after the U.S. Department of Labor and Federal Acquisition Regulatory Council extended the public comment period for pending proposals implementing Executive Order 13673, a group of Senate Republicans requested the U.S. Department of Labor withdraw its proposed guidance.

This is the second request made by Congressional leadership for withdrawal of the published guidance.  In late July, a group of Senate Committee and Sub-committee chairs made a similar request to the U.S. DOL and the FAR Council for withdrawal of its proposed rule.

Citing concerns with the U.S. DOL’s “incomplete” guidance, Senators Ron Johnson, Lamar Alexander, James Lankford and Johnny Isakson asked the Agency to “immediately withdraw its proposal.”  Specifically, the Senators noted concerns with significant unresolved issues “including which state laws will be covered and whether prime contractors will be required to facilitate subcontractor reporting.”  These omission, the Senators contend, make it impossible for federal contractors to provide useful feedback and prevent the FAR Council from adequately assessing the costs of its proposed rule.

Stay tuned for what happens next . . .

Compensation – it’s on everyone’s mind and it’s what everyone was talking about at the 33rd Annual ILG National Conference in New York City.  Conference attendees, government officials and practitioners alike were all talking about pay and the tools available to employers and agencies to identify and investigate compensation issues.

Our Jackson Lewis colleague Scott M. Pechaitis has put together his thoughts on OFCCP’s use of a new “tool” in its pay enforcement toolbox: the Compensation Manager Interview.

This is what Scott has to say:

As the Obama Administration continues to make headlines promoting “equal pay,” the directive from the White House to EEOC and OFCCP is, “we know pay discrimination exists – go find it.” OFCCP, which historically has not brought back a lot of compensation discrimination findings and settlements, has sharpened the tools in its compensation investigation toolbox, including the following:

Over the last two years, OFCCP has systematically overhauled its approach to investigating pay discrimination. And now, the Agency has developed yet another investigatory tool – compensation manager interviews.

Now, before sending pay data to the Agency’s statisticians, OFCCP is conducting compensation manager interviews to (1) learn how pay is administered (i.e., what larger groups are appropriate for analysis), (2) determine what additional components of compensation comprise total compensation, (3) ascertain what policies, documents, and analyses are available to be requested, and (4) identify any and all variables affecting pay for future data requests.

This makes the compensation manager interview critically important to the success of an OFCCP compensation investigation. The Agency will use the information learned during the interview to analyze your pay data. And yet, many employers are not treating the situation seriously or are otherwise failing to properly prepare for these important interviews. So how should you prepare for a compensation manager interview?   Below are four important tips to help you prepare for and successfully conduct an OFCCP compensation manager interview.

  1.  Review Your Pay Policies

OFCCP will review the policies to determine what data to ask for in subsequent requests, how to group employees, and for other documents and policies referenced therein. Know what they say before you turn them over.

  1. Communicating the Theme: Analyze Your Pay Data to Develop “Talking Points”

The employer’s goal in the compensation manager interview should be to convey themes explaining differences in pay, which is why it pays to do pay analyses in advance of the interview.

Federal contractors are required to analyze their compensation systems for EEO issues at least annually. 41 CFR § 60-2.17(b)(3). You should use your pay analyses to help shape the compensation manager’s talking points. The analyses should tell you what factors affect pay, what groupings look best for your organization, and where there are any issues.

The answers to these questions should become the Compensation Manager’s “talking points” in how pay is administered. Then, when OFCCP goes to analyze pay, it becomes a self-fulfilling prophecy – what we tell OFCCP about how pay is administered is confirmed by their analysis.

  1. Identify and Prepare the Interviewee

The interviewee should be someone who has first-hand knowledge of pay practices at the ground level. Consider conducting a mock interview to get the interviewee used to the format, tone, and types of questions that will be asked. Prepare the interviewee like a formal deposition. Substantively, be prepared to discuss all types of pay, including what groups of employees are eligible for each type of pay. For each grouping and each type of pay, be prepared to discuss how and when pay decisions are made. You do not need to be able to (and should not have to) speak to the pay for each employee included in the audit.

  1. OFCCP Requests for Pay Analyses

And one final word of caution – OFCCP will likely request copies of your pay analysis.  The Agency knows we must conduct annual pay analyses as part of our affirmative action plans and will often ask for these analyses during the compensation manager interview or in subsequent data requests. So it is more important than ever to make sure these analyses are protected by the attorney-client privilege.

And, the Agency will make us “prove” the privilege, which means much more than just having a lawyer involved in the process.  There are certain precautions an attorney must take to establish the privilege and protocols the employer’s team must follow to maintain it. 

While it is important to proactively analyze your pay data, it is equally importantly to take great care in establishing and protecting the privilege when doing so.  Otherwise you risk handing OFCCP the best evidence against you.

As first reported in the New York Times today, the White House, in connection with the U.S. Department of Labor, is working on an executive order requiring federal contractors to provide paid sick leave to their workers.  While a copy of the order was not made available, the article detailed some of the elements of the “pre-decisional and deliberative” draft, including the requirement that employers pay for up to a minimum of 56 hours a year for sick leave.  As currently drafted, the required leave would not be solely for an employee’s personal illness but would cover caring for others, including domestic partners.

Despite its draft form, the Executive Order noted regulations would be issued by the Secretary of Labor by Sept. 30, 2016.  With the Executive Order not yet finalized, it remains to be seen if this date will hold true.

This Executive Order would make the sixth employment-related executive action impacting federal contractors in the past 18 months.  The other actions include: