Idea to Merge EEOC, Contracting Watchdog Not Well-Received

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By Jay-Anne B. Casuga and Kevin McGowan

The idea of merging the DOL’s contract compliance office with the EEOC, which could emerge as a Trump administration proposal, has raised concerns among federal contractor representatives and a number of former Labor Department officials.

The Heritage Foundation, a conservative research think tank in Washington, recently recommended the merger as a way to promote government efficiency. Details on such a plan could be introduced as part of President Donald Trump’s fiscal 2018 budget proposal, which is expected to be released May 23. The Trump administration also has called on federal agencies to submit plans to streamline and reorganize their operations. A potential proposal to merge the Office of Federal Contract Compliance Programs with the Equal Employment Opportunity Commission could be included in those plans later this year.

But differences between the policy goals and legal authority of the Labor Department’s OFCCP and the EEOC make the two agencies less than a perfect fit.

The president also probably would have to secure Congress’ approval for at least part of any plan to make the federal contractor compliance program an arm of the EEOC.

The idea of shifting the OFCCP’s work to the EEOC has been broached for years, but it hasn’t been popular with the federal contractors subject to the Labor Department’s authority.

Not a ‘Sound’ Policy Proposal

“The contractor community, to my knowledge, has never supported it,” said Shirley Wilcher, an OFCCP director in the Clinton administration who’s now executive director of the American Association for Access, Equity and Diversity in Washington. “And certainly, the civil rights community hasn’t supported it.”

A merger would be “neither sound policy nor in the interests of federal contractors,” David Fortney, a former acting labor solicitor during the George H.W. Bush administration, told Bloomberg BNA. He’s now a partner with Fortney & Scott LLC, which represents federal contractors.

Fortney spoke for the Institute of Workplace Equality, a national nonprofit employer association in Washington. He is one of the institute’s co-chairs.

“The agencies are complementary, but they don’t do the same thing,” said Pamela Coukos, a former OFCCP senior program adviser during the Obama administration. Coukos is now a co-founder and principal of Working IDEAL, a consulting firm in Washington.

The White House and the Office of Management and Budget did not immediately respond to requests for comment.

EEOC Would Need More Resources

Building an OFCCP function into the EEOC would take time and money, Coukos said. Greater expenditures would seem to defeat the stated goal of increased efficiency.

Wilcher said that in most mergers, people lose their jobs. If the OFCCP were merged into the EEOC, it’s likely the contract compliance office would bear the brunt of the job losses.

The EEOC’s staff then would have to be trained on affirmative action and equal employment opportunity requirements enforced by the OFCCP that aren’t part of the commission’s duties, Wilcher said.

The “big question” is whether the OFCCP’s personnel and other resources would follow that agency to the EEOC, said P. David Lopez, a former general counsel with the commission and now a partner with Outten & Golden LLP in Washington.

The EEOC is historically a “resource-starved” agency, Lopez told Bloomberg BNA. If the administration shifted the contract compliance office’s work to the commission but didn’t also move the Labor Department people with expertise and their resources, that would be a problem, he said.

The EEOC has a pending backlog of approximately 73,500 discrimination charges, Fortney said. It’s “hard to understand” how adding the OFCCP’s work to “a currently overextended” EEOC would improve enforcement of nondiscrimination and affirmative action rules, he said.

Some Overlap, but Different Missions

At least one former DOL official sees potential merit in the idea that merging the OFFCP and the EEOC could streamline federal civil rights enforcement by reducing duplication.

“From an administrative and managerial perspective, it does make sense to combine the agencies,” said Jaime Ramón, who was the OFCCP director in the George H.W. Bush administration. “Here, you have two agencies basically doing the same thing with overlapping jurisdiction to combat discrimination.”The EEOC enforces Title VII of the 1964 Civil Rights Act, which prohibits bias based on race, sex, religion, color, and national origin.

The OFCCP enforces Executive Order 11,246, which bars workplace bias based on the same categories as Title VII but also includes sexual orientation and gender identity. It was signed by President Lyndon Johnson in 1965 and amended by President Barack Obama.

Both agencies enforce laws prohibiting disability discrimination—Section 503 of the Rehabilitation Act for the contract compliance office and the Americans with Disabilities Act for the commission.

The Heritage Foundation in its recommendation last summer listed the OFFCCP among the “redundant programs” that should be cut.

The agencies, however, also have distinct missions and enforcement structures.

It may be easy for outsiders to say the OFCCP is “sort of like the EEOC for federal contractors,” James Plunkett, senior government relations counsel with Ogletree Deakins Nash Smoak & Steward in Washington, told Bloomberg BNA. “But it’s really not. There’s some redundancy, but when you get down to the details, they are really very different agencies with different goals and missions.”

EO 11,246 applies to only government contractors, while Title VII applies to a broader swath of private and public employers. The OFCCP enforces the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA), while the EEOC doesn’t provide specific workplace protections for covered veterans.

The laws enforced by the contract compliance office require contractors to adopt affirmative action for minorities, women, people with disabilities, and veterans. The commission doesn’t similarly enforce affirmative action requirements.

Further, the laws enforced by the EEOC allow for jury trials, issuance of subpoenas as part of the commission’s investigations, and lawsuits filed in federal district, Fortney said. The OFCCP follows the Labor Department’s administrative process and can’t take claims to court on its own.

Representatives for the foundation representatives didn’t respond to Bloomberg BNA’s request for comment for this story.

Civil Rights or Procurement?

The EEOC’s origins lie in civil rights enforcement, but the OFCCP is meant to secure the government’s procurement interests by enforcing equal employment opportunity clauses in federal contracts, Wilcher said.

That explains why the contract compliance office doesn’t issue right-to-sue letters to contractor applicants or employees who complain about suspected discrimination, Wilcher said.

It’s also why the office’s ultimate sanction is contractor debarment, making some violators ineligible for future federal contracts, Wilcher said.

The OFCCP can provide “make-whole” relief to discrimination victims, such as back pay and interest, but it can’t order damages against a contractor, Wilcher said.

Transferring enforcement of contractors’ affirmative action and nondiscrimination obligations from the DOL to the EEOC is a “significant concern” because the government would lose “control over a key component of its ability to contract with the best qualified parties,” Fortney said.

Unlike the Labor Department, the EEOC is “a semi-independent agency” rather than a cabinet agency within the executive branch, he said.

The federal government “would be relying on the assessment of a semi-independent agency as to whether companies are complying with their obligations as federal contractors,” Fortney said.

Contractors Risk Greater Exposure

An OFCCP-EEOC merger also could expose contractors to compensatory and punitive damages for alleged discrimination.

Suppose a government contractor auditing arm of the commission conducts a compliance review of a contractor, finds statistical indicators of discrimination under EO 11,246, and decides enforcement proceedings are appropriate.

The EEOC could issue a concurrent commissioner’s charge to bring Title VII allegations against that contractor, said Ramón, the former OFCCP director.

“Every violation of the executive order is a potential Title VII claim,” making the contractor potentially liable for damages, he said.

In the end, any merger or transfer of functions isn’t “an easy thing to do,” said Coukos, the former OFCCP senior program adviser. “You can’t wave a pen and declare it so.”

To contact the reporters on this story: Jay-Anne B. Casuga in Washington at jcasuga@bna.com; Kevin McGowan in Washington at kmcgowan@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

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