On December 10, 2020, OFCCP printed its “Nondiscrimination Obligations of Federal Contractors and Subcontractors: Procedures To Resolve Potential Employment Discrimination” (the “Rule”). The Rule was welcomed by the contractor group, because it established necessary procedural and substantive necessities earlier than OFCCP can concern discrimination findings. Amongst different issues, the Rule units forth clear parameters for what OFCCP has to set up so as to pursue discrimination findings, and gives for transparency within the compliance analysis course of to guarantee contractors perceive the bases for OFCCP’s preliminary findings and to foster dialogue to keep away from erroneously-based Notices of Violation (“NOVs”).
On March 21, 2022, the company announced it will likely be proposing amendments to the Rule in addition to different regulatory adjustments. These proposed adjustments would roll again lots of the Rule’s safeguards so as to, as Director Jenny Yang explained, elevate “constrain[ts on] OFCCP’s broad enforcement discretion.” As detailed under, the proposed rulemaking would, amongst different issues:
remove evidentiary necessities for the issuance of pre-determination notices (“PDNs”) and NOVs;
remove the requirement that PDNs be permitted by the OFCCP Director earlier than issuance;
allow OFCCP to concern NOVs for violations not included in PDNs; and
cut back contractors’ time for responding to PDNs by half.
It’s clear from the proposed rulemaking that the Biden Administration’s OFCCP needs to pursue discrimination findings with out having to adjust to sure evidentiary and procedural necessities. It justifies the adjustments on varied grounds, together with its need for flexibility in imposing its mandate and to remove delays brought on by contractors searching for to maintain the company to the Rule’s necessities.
If these adjustments are carried out, contractors can count on to face extra findings of discrimination with much less transparency from OFCCP. They are going to not have the ability to rely on: receiving detailed bases for preliminary findings of discrimination or formal findings of discrimination; receiving discover and the chance to reply to discrimination findings prior to the issuance of an NOV; or figuring out any PDN or NOV has been topic to a evaluation by the Director, which was meant to present some stage of consistency to discrimination findings throughout the company. This growth, in addition to the Directive on disclosure of pay fairness analyses introduced final week, is a transparent sign to contractors that OFCCP will likely be way more aggressive in compliance evaluations transferring ahead.
OFCCP’s proposed rulemaking will likely be formally printed on March 22, 2022. The general public may have till April 21, 2022 to submit feedback.
What Amendments Are Being Proposed?
Elimination of Evidentiary and Procedural Standards for PDNs and NOVs
The prevailing Rule gives that earlier than OFCCP could concern a pre-determination discover (“PDN”), offering the contractor discover of a preliminary discovering of discrimination and the chance to reply, the company should have sure evidentiary support. Particularly, the company is required to disclose each the “qualitative” (i.e., testimony and paperwork) and “quantitative” (i.e., knowledge evaluation) evidentiary help for its preliminary discovering(s). With regard to quantitative proof, the company is required to reveal any disparity is “practically significant.” Additional, PDNs have to be permitted by the OFCCP Director earlier than issuance.
OFCCP now proposes to get rid of these safeguards. With regard to the evidentiary conditions, OFCCP seeks to remove them, “conclud[ing] that rigid evidentiary standards are unnecessary and unduly constrain the agency’s broad enforcement discretion as to the cases it decides to litigate and those it does not.” In its proposed rulemaking, the company contends the necessities are inconsistent with Title VII’s evidentiary requirements and “led to delays in resolutions by increasing disagreements between OFCCP and contractors about the requirements for” PDNs. Additional, OFCCP complains that the requirement that the company disclose within the PDN the anecdotal proof relied upon in reaching its preliminary willpower “may have a chilling effect on the willingness of victims and witnesses to participate in OFCCP’s investigation due to concerns that an employer may uncover their identities, which could lead to retaliation.” As proposed, OFCCP would solely have to concern a PDN “describing the indicators and providing the contractor an opportunity to respond.”
As a result of OFCCP proposes it not be required to disclose qualitative and quantitative proof in its PDN, its proposal would additionally get rid of the definitions of these phrases within the Rule. OFCCP additionally proposes to jettison the requirement it reveal sensible significance prior to issuing a PDN. Additional, PDNs will not require Director approval prior to issuance.
OFCCP seeks to get rid of the identical evidentiary necessities at the moment in place for NOVs, in addition to the Rule’s requirement that NOVs could not embody discrimination findings except they have been additionally included within the PDN. In different phrases, below OFCCP’s proposal, a contractor may first be taught of a discrimination concern when OFCCP points a proper discovering of discrimination in an NOV.
Lowering Contractors’ Time To Reply to a PDN
One welcome characteristic of the Rule is its extension of the time to reply to a PDN to 30 days. The OFCCP’s proposal would revert the response time again to 15 days, which can be prolonged by OFCCP for “good cause.” Provided that PDNs could be (and typically are) issued with little to no discover, and could comprise a number of indicators of discrimination that usually take time to analyze and rebut, this proposed change will place important time constraints on contractors.
Defining “Reasonable” Efforts” With Regard To Conciliation
Present rules (41 C.F.R. § 60-1.20(b)) present that if OFCCP finds “deficiencies” throughout a compliance analysis, “reasonable efforts [shall be made] to secure compliance through conciliation and persuasion.” OFCCP proposes to outline such “reasonable efforts” to “make clear that OFCCP’s conciliation standards align with Title VII.” To that finish, OFCCP proposes to have “reasonable efforts” be “interpreted consistently with title VII of the Civil Rights Act of 1964 and its requirement that the Equal Employment Opportunity Commission ‘endeavor to eliminate any such alleged unlawful employment practice by informal methods of conference, conciliation, and persuasion.’”
Present Trigger Discover Provisions
Present Trigger Notices (“SCNs”) are issued to contractors OFCCP has “reasonable cause to believe” have violated the equal alternative clause, and gives the contractor 30 days to present trigger why enforcement proceedings shouldn’t be instituted. SCNs sometimes comply with the issuance of an NOV and the failure by OFCCP and the contractor to attain a conciliation settlement, although they’ll additionally stream from a contractor refusing OFCCP entry to services or data.
OFCCP proposes to amend its rules to clarify that SCNs could also be issued with out first issuing a PDN or NOV, the place the contractor “has failed to provide access to its premises for an on-site review or refused to provide access to witnesses, records, or other information.”
OFCCP’s proposal additionally gives that it might concern Present Trigger Notices (“SCNs”) that embody violations not included in its NOVs. SCNs should “include each violation that OFCCP has identified at the time of issuance,” and the place “OFCCP identifies additional violations after issuing a [SCN], OFCCP will modify or amend the” SCN. The proposed regulation does present that contractors will likely be supplied “an opportunity to conciliate additional violations identified in the” SCN that aren’t included in a previous NOV.