The Ogletree OFCCP Bulletin: January 2021

Here are the latest developments from the U.S. Department of Labor’s (DOL) Office of Federal Contract Compliance Programs (OFCCP).

New OFCCP Director. Jenny Yang, formerly of the U.S. Equal Employment Opportunity Commission (EEOC) recently replaced Craig Leen as director of OFCCP. Yang was at the EEOC from 2013 to 2018, initially as an EEOC commissioner and later as vice chair and chair from 2014 to 2017.

Section 503 Focused Review Report. OFCCP recently published its “Section 503 Focused Reviews Fiscal Year 2020 Annual Report.” The report provides a description of the goals of the Section 503 Focused Review Program, the guidance provided in anticipation of the reviews, the results of those reviews, and what was learned from the reviews. In the report, OFCCP noted that it did not find discrimination or reasonable accommodation violations in Section 503 Focused Reviews. The report lists the top five violations “found during Section 503 Focused Reviews.

1. Failure to conduct appropriate outreach and positive recruitment of individuals with disabilities that were reasonably designed to effectively recruit qualified individuals with disabilities;
2. Failure to invite applicant and employees to self-identify as an individual with a disability;
3. Failure to document the computations or comparisons pertaining to applicants and hires, as described in 41 CFR 60-741.44(k) and maintain this data for three (3) years;
4. Failure to design and implement an acceptable audit and reporting system which measured the effectiveness of its affirmative action program; and
5. Failure to develop and submit acceptable Section 503 AAPs and support data.”

Litigation Against the Religious Exemption Rule. On January 8, 2021, OFCCP’s final rule Implementing Legal Requirements Regarding the Equal Opportunity Clause’s Religious Exemption went into effect. This rule was met with great discussion as OFCCP received over 100,000 comments during the 30-day public comment period. Concerns over this new rule continued to be raised as the new administration took office on January 20, 2021. Just one day after the January 20, 2021, inauguration, separate lawsuits on either side of the country were filed seeking to set aside the rule and enjoin the Department of Labor from moving the rule forward in any fashion. One lawsuit was jointly filed in the United States District Court for the District of New York by attorney generals in 14 states (New York, California, Colorado, Connecticut, Illinois, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, Pennsylvania, and Vermont) and the District of Columbia. The other lawsuit was filed in the United States District Court for the District of Oregon.

Final Rule on Procedures for Discrimination Resolutions. On November 10, 2020, OFCCP published in the Federal Register a final rule regarding procedures to resolve potential employment discrimination. According to OFCCP, the final rule, titled “Nondiscrimination Obligations of Federal Contractors and Subcontractors: Procedures to Resolve Potential Employment Discrimination,” “increases clarity and transparency for federal contractors, establishes clear parameters for OFCCP resolution procedures, and enhances the efficient enforcement of equal employment opportunity laws.” The new rule also includes guidelines for issuing predetermination notices (PDN) and Notices of Violation (NOV). Unlike the notice of proposed rulemaking, the final rule defines “qualitative” and “quantitative” evidence and increases the time that contractors have to respond to PDNs to 30 days (up from 15).

Executive Order 13950 on Race and Sex Stereotyping Revoked. On January 20, 2021, President Biden, in his first day in office, issued Executive Order (EO) 13985, “Advancing Racial Equity and Support for Underserved Communities Through the Federal Government,” revoking EO 13950, “Combating Race and Sex Stereotyping,” which restricted the content of certain federal agencies’ diversity-related workplace trainings. According to this new executive order, advancing equity across the federal government “can create opportunities for the improvement of communities that have been historically underserved” and “each agency must assess whether, and to what extent, its programs and policies perpetuate systemic barriers to opportunities and benefits for people of color and other underserved groups.” On December 22, 2020, the United States District Court for the Northern District of California issued a nationwide preliminary injunction prohibiting OFCCP from implementing, enforcing, or effectuating Section 4 of EO 13950. As a result, OFCCP closed all complaints regarding noncompliance with EO 13950, rescinded its frequently asked questions guidance on the revoked EO, and discontinued its phone hotline and email accepting EO 13950 complaints.

OFCCP Issues 2020 Year in Review. On January 4, 2021, OFCCP looked back at the previous year of enforcement, commenting that “[g]iven the coronavirus pandemic, it was a challenging year,” but that the agency “responded nimbly and effectively, adjusting to the new conditions by granting extensions to federal contractors, increasing compliance assistance and outreach, and implementing virtual compliance evaluations.” OFCCP’s report on 2020 cited the agency’s:

1. “Effective Enforcement,” (including “Record Monetary Settlements” and “Expanded Focused Reviews”);
2. “Rulemaking”; (including the final rule on nondiscrimination obligations of federal contractors and subcontractors , the religious exemption final rule, and the TRICARE final rule;
3. “Increased Transparency” (including an updated Federal Contract Compliance Manual and new policy directives)
4. “Enhanced Efficiency” (including updated technical assistance guidesand early resolution procedures)
5. “Supported Equal Employment Opportunity” (including its Historically Black Colleges and Universities Initiativeand Indian and Native American Employment Rights Program).