Issues regarding pay equity have been front of mind for the Office of Federal Contract Compliance Programs (“OFCCP”) this year, as evidenced by the agency’s promise to “redoubl[e] its efforts” to ensure that government contractors are complying with the compensation evaluation portion of their affirmative action programming.
As we discussed previously (here), this past March the OFCCP issued directive DIR 2022-01, in which it addressed contractors’ obligations to conduct “comprehensive pay equity audits.” The directive received a considerable amount of criticism, including that DIR 2022-01 evinced a belief on the part of the OFCCP that it was entitled to contractors’ complete pay equity analyses regardless of whether such analyses were privileged, either as attorney-client communications or attorney work product.
Much to the comfort of government contractors, the OFCCP issued a revised DIR 2022-01 on August 18. The revised directive clarifies what types of information and documentation contractors are (and are not) required to provide the OFCCP in order to demonstrate compliance. The revised directive “explicitly reaffirms the OFCCP’s position that it will not require the production of attorney-client privileged communications or attorney work product.” Indeed, the revised directive states that if a contractor believes that its full compensation analysis is privileged, it can still fulfill its regulatory obligations by making available to the OFCCP other types of documentation demonstrating that the contractor is in compliance, including a redacted version of the compensation analysis or “a detailed affidavit,” provided that the redacted analysis or affidavit contains facts that are enumerated in the directive. Contractors and their attorneys should exercise caution to ensure that any production of information does not create the ability for the government or employees to claim that privilege has been waived.
The revised directive underscores the importance of engaging counsel when conducting compensation analyses. Because the OFCCP will not require the production of privileged attorney-client communications or attorney work product, contractors should consider engaging counsel to oversee the analyses including the hiring of any consultants to perform these analyses, thereby increasing the likelihood that such analyses are privileged and beyond the reach of the OFCCP.
