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On March 21, 2022, the Office of Federal Contract Compliance Programs (OFCCP) announced that it would publish a notice of proposed rulemaking (NPRM), entitled “Pre-enforcement Notice and Conciliation Procedures,” in the Federal Register on March 22, 2022. OFCCP’s proposal would modify a 2020 final rule that had codified various procedures to resolve potential employment discrimination.

OFCCP’s announcement included a link to a blog post by OFCCP Director Jenny Yang. According to Yang, “[t]he 2020 rule unduly constrained OFCCP’s broad enforcement discretion. Its imposition of formulaic proof standards to be applied to every case harms workers by undermining OFCCP’s ability to effectively bring the full range of cases within its authority and remove barriers to equal employment opportunity.” The 2020 final rule, “Nondiscrimination Obligations of Federal Contractors and Subcontractors: Procedures to Resolve Potential Employment Discrimination,” had codified OFCCP’s use of predetermination notices and notices of violation, clarified various evidentiary definitions and standards that OFCCP must meet during the pre-enforcement notice process, provided for an expedited voluntary conciliation option, and extended the predetermination notice response period to thirty calendar days.

Highlights of OFCCP’s proposed rule include the following:

  • It would rescind the 2020 final rule’s evidentiary definitions and standards and instead apply Title VII of the Civil Rights Act of 1964 standards to compliance evaluations, including during the pre-enforcement notice and conciliation stages.
  • It would retain the use of predetermination notices and notices of violation but modify the applicable procedures.
  • It would require contractors to respond to a predetermination notice within fifteen calendar days, absent an extension. It would further clarify that the response must be received by OFCCP within those fifteen calendar days.
  • It would delete a severability clause that had applied to certain portions of OFCCP’s regulations and replace it with severability clauses covering every part of OFCCP’s regulations.

The proposed rule would retain the 2020 final rule’s language that allows for early resolution through voluntary conciliation agreements. Public comments must be submitted by April 21, 2022.

Key Takeaways

In a compensation directive issued on March 15, 2022, OFCCP stated that it was “committed to facilitating a transparent and efficient process to identify and remove barriers to opportunity.” In that directive, OFCCP stated that “contractor transparency” is required when OFCCP requests pay equity audits from contractors.

In this NPRM, OFCCP appears to be taking steps to decrease the transparency of the agency’s investigations into contractors’ compliance practices, claiming that the rigidity of the current rule does not align with OFCCP’s stated mission. Contractors may want to consider the agency’s shifting approaches as they consider how best to comply with the affirmative action regulations and prepare for increased enforcement activity, in addition to a possible lack of consistency in the way OFCCP may approach compliance evaluations in different regions, if this proposed rule goes into effect.

Ogletree Deakins’ Affirmative Action and OFCCP Compliance Practice Group will continue to monitor developments regarding this proposed rule and will post updates on the firm’s Affirmative Action / OFCCP blog as additional information becomes available. Important information for government contractors is also available via the firm’s podcast and webinar programs.


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Pay Equity

Recent high-profile lawsuits and increased activity from state legislatures have thrust pay equity issues to the forefront for today’s employers. As the momentum of legislation, regulation, and corporate initiatives focused on identifying and correcting pay disparities continues to grow, our attorneys are ready to assist with the full spectrum of pay equity-related issues.

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OFCCP Compliance, Government Contracting, and Reporting

The experienced attorneys in our OFCCP Compliance, Government Contracting, and Reporting Practice Group advise and defend federal contractors and subcontractors on jurisdictional, compliance, and enforcement issues relevant to government contracting, including those involving the Office of Federal Contract Compliance Programs (OFCCP).

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