Second, OFCCP is proposing a highly controversial change to become less transparent to federal contractors in audits when OFCCP is alleging claims of alleged unlawful employment discrimination or of alleged Affirmative Action violations, or of both. Here is how:
- The text of Executive Order 11246, as amended, has language (much like that in Title VII of the 1964 Civil Rights Act) requiring OFCCP to conciliate with contractors in audits and in Complaint investigations as a necessary pre-condition to later reaching impasse with a contactor and filing an Administrative Complaint against it involving either claims of alleged unlawful employment discrimination or of alleged Affirmative Action violations, or of both:
- Section 209, para 6, part (b): “Pursuant to rules and regulations prescribed by the Secretary of Labor, the Secretary shall make reasonable efforts, within a reasonable time limitation, to secure compliance with the contract provisions of this Order by methods of conference, conciliation, mediation, and persuasion before proceedings (emphasis added) shall be instituted under subsection (a)(2) of this Section, or before a contract shall be cancelled or terminated in whole or in part under subsection (a)(5) of this Section.”
- Note: Of course, OFCCP does not have the legal authority to debar federal contractors from their federal contracts. Rather, Section 208(b) of EO 11246 requires OFCCP to first sue the Contractor by filing an Administrative Complaint with the Office of Administrative Law Judges which will appoint an Administrative Law Judge (“ALJ”) to conduct a trial type hearing which looks much like a trial in federal court. Then, the ALJ may only “recommend,” but not implement, a debarment. There is much more to it beyond the space here to describe it.
- The SCOTUS ruled in 2015 in the Mach Mining v. EEOC case decision, interpreting Title VII’s similar “conciliation required” language, that the statute required only that the EEOC essentially put the employer on notice of the agency’s dispute with the employer and the agency’s remedial demand but without sharing the agency’s evidence or reasoning or work product in support of either liability or damages.
- The Equal Employment Opportunity Commission’s then Republican majority (on the five-Member Commission) voted on January14, 2021 to issue a Final Rule committing the EEOC to go beyond the bare-bones Mach Mining conciliation requirement. If you are rusty on the Mach Mining holding, read our prior WIR story discussing it while reporting on the Commission’s (soon to be short-lived) vote for transparency.
- Congressional Democrats, then in control of the House and with a 50-50 balance of power in the Senate with Republicans, but able to win 50/50 Senate votes with the help of the Democrat Vice President’s tie-breaker vote, on March 23, 2021 introduced legislation to rescind the EEOC’s transparency Rule. On June 28, 2021, The Senate and House finished voting in favor of the rescission and sent the Bill to President Biden for his signature.
- So, now, the Biden OFCCP is heading down the same path as the Congressional Democrats to rescind the transparency Rules the Trump OFCCP passed in parallel with the EEOC’s transparency bill. The Biden OFCCP’s objective is to now install a requirement that OFCCP need only comply with the bare-bones requirement of Title VII’s conciliation requirement as the SCOTUS’ court decision interpreted it. The OFCCP mechanically accomplishes this in its NPRM by proposing to re-write 41 CFR Section 60-1.20(b) to impose on OFCCP only a “reasonable efforts” standard of conciliation. The newly proposed section 60-1.20(b) would also state that OFCCP will interpret the term “reasonable efforts” to be consistent with the SCOTUS’ Mach Mining decision’s holding which outlined what the EEOC had do to conciliate to meet Title VII’s bare-bones requirement. This re-write of Section 60-1.20(b) would also work hand-in-glove with the rescission of the “evidentiary standards” discussed above because compliance with those standards operated as the transparency federal contractors needed to understand OFCCP’s claims and proof thereof.
Here is what OFCCP’s proposed modified Rule says exactly at page 16152 of OFCCP’s NPRM:
“3. Amend § 60-1.20 by revising paragraph (b) to read as follows:
60-1.20 Compliance evaluations.
* * * * *
Where deficiencies are found to exist, OFCCP will make reasonable efforts to secure compliance through conciliation and persuasion, pursuant to § 60-1.33. The “reasonable efforts” standard shall 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.”
OFCCP’s articulated rationale for the proposed modification does not address and carefully avoids the lack of transparency its new proposed Rule will cause. Rather, OFCCP creates a separate discussion attacking the “evidentiary standards” discussed above (which, again, allow for contractors to transparently understand OFCCP’s facts and the law the agency believes applies and to replicate OFCCP’s liability and damages analyses) as going beyond the Executive Order’s requirements of necessary disclosure to meet its obligation to “conciliate.” OFCCP also complains that it burdens the agency to have to put its case together to present it to the contractor as though the agency were ready to go to trial.
But then, to add insult to injury, OFCCP complains that the agency’s Predetermination Notice is only a very preliminary accusation of unlawful discrimination and that is why contractors should not expect the agency to build out its case as though it were ready to go to trial. However, OFCCP first fails to mention that it also seeks (usually substantial) financial recompense at the same time from the contractor. So, on the one hand OFCCP argues that the Predetermination Notice is a trifle and not really a mature or meaningful document in the audit since it is so preliminary, and the agency really does not have its proof, or its case assembled just yet, but nonetheless uses the PDN to annually demand millions of dollars of backpay from contractors.
Second, OFCCP also fails to mention that its practice has been to circulate the draft PDN, prior to presentation to the contractor, throughout the entire OFCCP review chain of command which must approve it. So, once the OFCCP chain of command has approved the PDN for whatever good or bad reasons known only to OFCCP but not the contractor, the subsequent agency issuance of Notices of Violation and Show Cause Notices provide no opportunity for any additional levels of meaningful review of the dispute (as used to happen) since “OFCCP has decided.”
And what exactly is the review process? There is not a meaningful one at OFCCP any longer. The same National Office Enforcement Division which undertook OFCCP’s secret liability and damages analyses are the same individuals reviewing their work product when the contractor pushes back. Investigator, analyst, judge, jury, and executioner all rolled into one. OFCCP discrimination analyses are now a closed loop system with decisions typically reverting to a small group of Labor Economists in the National Office with a few senior administrators signing off on typically technical statistical analyses they have not prepared, do not have the technical training to understand and routinely cannot and will not explain to contractors.