John Fox Provided His Patented Candid Scoop on What is Going on at OFCCP
“You are going to be very busy the last half of this year because a lot of things are getting delayed and a lot of things are getting pushed,” Attorney John C. Fox of Fox, Wang & Morgan P.C. forecast in his introduction to his presentation on recent OFCCP developments. “You will be asked for a lot of comments from a lot of agencies. “Get ready for that,” he told the audience. John also highlighted items on OFCCP’s regulatory agenda. [Note: details on regulatory agenda timelines are available on DE’s OFCCP Week in Review in the “Looking Ahead: Upcoming Date Reminders” section.]
“[T]his once-grand agency [is] failing in front of our very eyes. It is really difficult to observe,” John bemoaned. The OFCCP is down by every metric that any Administration – Republican or Democrat – has ever used in the last 50 years. “Not only is the agency down, but it is down dramatically. Every metric. This is the trend across the board. They’re just in free fall,” he observed.
Personnel Developments
First, John reviewed the agency staffing situation. In March, OFCCP Director Jenny R. Yang and Maya Raghu, a political appointee reporting to Director Yang as the Deputy Director for Policy, both announced their resignations from the agency. As a result, OFCCP may be without a political leader at the top “perhaps long-term until the next presidential election,” he reported. “That is under discussion at the agency right now. If that happens, it will be the first time in the 50-year history of the OFCCP that has occurred.”
Acting Secretary of Labor Julie Su appointed OFCCP Deputy Director Michele Hodge to serve as the agency’s Acting Director until the Secretary of Labor appoints a new political employee to be the agency’s “Director” if she does. However, “nothing is going to change at the OFCCP in terms of audits and policy because [Hodge] has been running it for years,” John pointed out.
While OFCCP always had high turnover, “right now they have to hire four to save three over the course of 12 months,” John noted. “They have had a 25 percent turnover in the first six months of their new hires alone.” Federal contractors are experiencing delays and errors because OFCCP “is now down a third to a half, depending on when you want to count, their [full-time equivalent] positions count,” he explained.
Shift to Centralized Control
John told the audience to “look for increasing centralization [with OFCCP’s organizational structure]” driven by a 2016 U.S. Government Accountability Office (“GAO”) report that said geography is no longer important to enforcement. Specifically, the GAO recommended that “the Secretary of Labor should direct the Director of OFCCP to make changes to the current scheduling list distribution process so that it addresses changes in human capital and does not rely exclusively on geographic location.”
“They’re getting rid of their field structure step by step by step because it is all going into the national office,” John stated. “You will see a lot of the compliance officers from other regions doing your audits because it is all online now,” he added.
Performance Metrics Down Across the Board
John shared a series of slides showing the specific personnel and enforcement numbers to illustrate the gamut of declines. Audits are at an all-time low even as OFCCP is promising audits will slow down even further. Moreover, the agency’s budget continued to decline. “You have heard me say for the last 15 years that I think that they need not just a little more budget but a lot more budget because this agency is now too small,” he noted.
Contractor Portals Are Hard
“I’m sure they wish they never started the portal thing because it has gotten them such a black eye. The problem is the budget […. and] portals are hard,” John observed.
He discussed two portals: (1) the OFCCP Contractor Portal (formerly initially titled “The Contractor AAP Certification Portal”) and (2) the Notification of Construction Contact Award Portal (NCAP). Both portals are unlawful, John pointed out. “That’s why 44 percent of employers last year did not participate in the [OFCCP Contractor] portal because [OFCCP failed to] send it through the [legally required] Administrative Procedure Act [notice and comment procedures].
As to the OFCCP Contractor Portal, OFCCP has “talked about it being a portal to receive all of your documents and audits. They’re not ready to do that yet,” John stated. “They can’t extract the data out of it reliably. So, all of your AAP certifications are largely a mystery to them as we sit today.”
In a related example, OFCCP erred by including companies improperly on its latest Corporate Scheduling Announcement List (“CSAL”). That January 20, 2023, CSAL announced upcoming audits of contractors that OFCCP determined had NOT “certified” their AAPs in the OFCCP Contractor Portal” in 2022 before the often-revised filing deadline eventually became set in concrete for December 1, 2022. However, apparently, about 20 percent of that January CSAL contained the names of companies that had in fact timely certified in OFCCP’s Contractor Portal. “So OFCCP did the right thing and said if we improperly listed you, let us know and we will take your name off the audit list,” John reported. “If you’re one of those, there is still time to do that because they didn’t follow their own rules. And they want to correct that,” he added.
Data extraction problems plague OFCCP in other areas as well, including the OFCCP Submitter Notice Response Portal, John said. [Recent updates on that situation are available here and here; see also John’s discussion of these issues here].