Contractor Watchdog Would Focus on Pay Bias During Merger Planning

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By Jay-Anne B. Casuga

The Labor Department’s federal contractor watchdog will continue to focus on systemic pay discrimination and establish skilled regional centers while it prepares itself for a possible merger with the EEOC, the DOL said in fiscal year 2018 budget documents.

President Donald Trump proposed in a budget blueprint released May 23 folding the DOL’s Office of Federal Contract Compliance Programs into the Equal Employment Opportunity Commission. If approved by Congress, the merger is expected to occur by September 2018. Employer stakeholders and civil rights groups oppose a merger.

For what would be the OFCCP’s transition process in fiscal 2018, the president proposed an $88 million budget for the agency. That’s a cut of about $17 million, or 16 percent, from its current funding level.

The budget “reflects some transformations” that would occur at the OFCCP in anticipation of its transfer to the commission, DOL officials said during a May 23 press briefing. “Rightsizing would need to happen,” they said.

“Rightsizing” apparently means layoffs. The president’s budget proposal calls for a workforce reduction of about 131 full-time equivalent employees, which would shrink the contract compliance office’s workforce to 440 employees.

A DOL spokesman declined to provide further comment outside of the briefing.

Former OFCCP officials previously predicted that the OFCCP would face layoffs and district office closures with a funding cut. They also speculated that the agency could return to a shorter, tiered-audit process used during the Clinton and Bush administrations, as opposed to the deep-dive approach of the Obama administration.

But the agency in its recent budget justification said it would “continue to put a premium on high quality compliance evaluations.”

Pay Discrimination Focus to Continue

The OFCCP made uncovering and combating systemic pay discrimination a top enforcement priority under President Barack Obama.

The agency in fiscal 2018 is expected to “continue a steady course of identifying and remedying systemic discrimination and prioritizing those evaluations with evidence of systemic pay issues,” it said.

It also plans to provide “intensive compliance assistance” to contractors and subcontractors on large construction projects.

Skilled Regional Centers to Move Forward

In its last budget justification under the Obama administration, the OFCCP discussed plans to establish two “skilled regional centers,” one in San Francisco and one in New York.

The centers would be staffed with specialized compliance officers who would handle complex audits of contractors in specific industries, such as financial services or information technology.

Trump’s budget proposal continues plans to establish these centers.

“Compliance evaluations conducted by highly skilled compliance officers greatly increase evaluation quality and timeliness as well as the more efficient use of limited resources,” the OFCCP said. “It also reduces the need for a network of field area and district offices.”

To contact the reporter on this story: Jay-Anne B. Casuga in Washington at jcasuga@bna.com

To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com; Christopher Opfer at copfer@bna.com

For More Information

The OFCCP's fiscal 2018 budget justification is available at http://src.bna.com/o8D.

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