OFCCP Begins Rulemaking Process On Compensation Data Collection Tool

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As part of its effort to address potential sex and race discrimination in pay by federal contractors, the Labor Department's Office of Federal Contract Compliance Programs Aug. 9 issued an advance notice of proposed rulemaking soliciting public comment on development of a compensation data collection tool.

Published in the Aug. 10 Federal Register (76 Fed. Reg. 49,398), the notice asks federal contractors and other OFCCP stakeholders for their input on the “scope, content, and format of the data collection tool, as well as suggestions for ensuring that the tool will be an effective and efficient means of identifying contractors” for OFCCP compliance reviews under Executive Order 11246.

As the agency that enforces federal contractors' nondiscrimination and affirmative action obligations under EO 11246, OFCCP has long sought greater access to contractors' employee compensation data. In 2006, during the Bush administration, OFCCP rescinded the Equal Opportunity Survey, an earlier effort to collect more extensive wage data from contractors.

In its current notice, OFCCP poses 15 specific questions for those submitting comments, covering what compensation data should be collected, how information should be organized, whether OFCCP should consider extending any compensation data tool beyond service and supply contractors to construction industry contractors, and how to manage the potential burdens on small businesses that are federal contractors.

OFCCP emphasized that its current notice is the beginning of the rulemaking process and that covered contractors will have additional opportunities for comment.

Comments are due 60 days after publication and may be submitted at http://www.regulations.gov, or by mail or hand-delivery to: Debra A. Carr, Division of Policy, Planning, and Program Development, OFCCP, Room C-3325, 200 Constitution Ave. N.W., Washington, D.C. 20210. Those seeking further information may contact Carr at (202) 693-0103 (voice) or (202) 693-1337 (TTY).

Tool Seen as ‘Screening' Device.

In its notice, OFCCP said possible uses for the compensation information provided by its planned data collection tool “include generating insight into potential problems of compensation discrimination at the establishment level that warrant further review or evaluation by OFCCP or contractor self-audits.”

“OFCCP could use the data collected by the tool to conduct analyses at the establishment level, as well as to identify and analyze industry trends, federal contractors' compensation practices, and potential equal employment-related issues,” the agency said.

The notice recounted OFCCP's experience with the Equal Opportunity Survey, which was implemented during the Clinton administration but rescinded in 2006 after an OFCCP-commissioned report during the Bush administration concluded the survey “had little predictive value for indicating discrimination or non-compliance” by federal contractors (24 HRR 959, 9/11/06).

OFCCP said its planned new compensation tool is “envisioned primarily as a screening tool, although it may also have research value.”

The tool also would provide contractors with a self-assessment tool that could be used periodically to evaluate the effects of their employee compensation decisions, the agency said.

The tool is needed because there is a persistent gender pay gap, with data showing that as of 2010, the average working woman makes 77 cents for every dollar earned by the average male worker, with even larger pay disparities affecting women of color, OFCCP said.

OFCCP said that in the upcoming months it will be conducting webinars and town hall listening sessions regarding the compensation data tool.

Employer Group Calls Tool ‘Burdensome.'

Jeff Norris, president of the Equal Employment Advisory Council, told BNA Aug. 11 that the council will definitely be commenting on the notice because it is a very significant issue for large employers.

“It will be very burdensome,” he said of the data collection tool, and not an effective instrument for accomplishing OFCCP's objectives.

By Kevin P. McGowan

OFCCP's advance notice of proposed rulemaking can be accessed at http://op.bna.com/dlrcases.nsf/r?Open=kmgn-8kkkrp .