OFCCP Will Continue Focus on Pay Bias, Shiu Says

From labor disputes cases to labor and employment publications, for your research, you’ll find solutions on Bloomberg Law®. Protect your clients by developing strategies based on Litigation...

By Jay-Anne B. Casuga

Aug. 3 — The Labor Department's Office of Federal Contract Compliance Programs will continue to focus its enforcement efforts on eliminating systemic pay discrimination by federal contractors and subcontractors, OFCCP Director Patricia A. Shiu said today.

“We have prioritized systemic pay discrimination, and I believe that is not going to change any time in the near future,” Shiu said at a National Industry Liaison Group conference in Charlotte, N.C.

“OFCCP has blazed through these past seven years with numerous regulatory, enforcement, policy, procedural and infrastructure accomplishments,” Shiu said. “All were designed to realize our mission, which is to enforce for the benefit of job seekers and wage earners the contractual promise of affirmative action and equal employment opportunity required of those who do business with the federal government.”

Shiu said the speech would be her last to the NILG as the head of the OFCCP under the Obama administration. She became the agency's director in October 2009.

OFCCP’s Regulatory Initiatives, Recoveries

Shiu discussed what she described as the OFCCP’s “aggressive regulatory agenda” under her leadership.

In August 2013, the OFCCP finalized what Shiu called “historic” rules under Section 503 of the Rehabilitation Act and the Vietnam Era Veterans’ Readjustment Assistance Act that required federal contractors for the first time to adopt “aspirational” hiring goals for individuals with disabilities and hiring benchmarks for covered military veterans.

Those rules also introduced a number of new data collection, outreach and recruitment obligations.

“By almost every measure, there has been an increase in the number of individuals with disabilities who have been hired by federal contractors,” Shiu said. “I like to think that’s not just because of Section 503, but because people have come to understand the importance of culture change and ensure we don’t leave any talent on the table.”

The OFCCP in December 2014 issued a final rule under Executive Order 11,246 to prohibit contractors from discriminating against applicants and employees based on sexual orientation and gender identity.

Additionally, this past June, it revised rules pertaining to sex discrimination that hadn’t been updated in more than 40 years.

The OFCCP has made “profound changes … in expanding our jurisdiction and protections under the executive order,” Shiu said.

Since the beginning of the Obama administration, OFCCP compliance officers have reviewed 28,811 federal contractor establishments that collectively employ approximately 12 million workers, Shiu said. In cases involving discrimination allegations, the agency has recovered almost $75 million in back pay and negotiated more than 12,000 job offers during this administration, she said.

“When I think about strengthening OFCCP’s civil rights enforcement and what the agency looked like and what it did seven years ago and what it does now, I think it’s fair to say that it has changed dramatically,” Shiu said, “in large part because President Obama wanted this agency to be a worker protection agency that worked with the other civil rights agencies within the federal government.”

Shiu pointed out that most of the time, OFCCP compliance reviews find that federal contractors are complying with the law. “And that’s exactly what we want to find,” she said.

Pay Bias Still in Focus

Despite more than five decades of economic, social and legal progress, Shiu said, women working full-time, year-round, still make 82 cents for every $1 a man earns. That pay gap is even greater for black and Hispanic women, and it also affects individuals with disabilities and lesbian, gay, bisexual and transgender workers, she said.

The pay gap costs these workers thousands of dollars per year and potentially hundreds of thousands of dollars over a working lifetime, she said.

The OFCCP also sees pay discrimination against men in some instances, and more frequently men of color, Shiu said.

During the past seven years, the OFCCP has made combatting compensation discrimination a top initiative to contribute to President Barack Obama’s mission to narrow the pay gap between males and females, and minorities and non-minorities, Shiu said.

In 2013, the agency rescinded its 2006 interpretative standards for systemic compensation discrimination and voluntary guidelines for self-evaluation of pay practices for federal contractors under Executive Order 11,246. It replaced them with a new directive that provided broader and more flexible investigation procedures.

The OFCCP in 2015 finalized a pay transparency rule that prohibits federal contractors from discriminating against employees and applicants who discuss, disclose or inquire about pay.

The OFCCP also worked on a federal contractor pay data collection tool. That has since evolved into an Equal Employment Opportunity Commission proposal to require employers, including federal contractors, to provide summary pay data grouped by sex, race and ethnicity as part of their annual employer information report (EEO-1) submissions.

“We believe that collecting summary pay information and analyzing it by race, gender, industry and job category could improve the efficiency of civil rights enforcement,” Shiu said. “It could also encourage contractors to be proactive in reviewing their pay.”

She reminded contractors that EO 11,246’s regulations, which have existed for many years, contain an obligation for them to review on an annual basis their compensation practices.

“This is not something that is new,” she said.

OFCCP Access to Contractor Records

Shiu said it’s been reported to her at this and other conferences that some contractors have been advised not to provide the OFCCP with documents requested during compliance reviews, such as affirmative action programs and other backup information.

If contractors do provide those documents, some have been advised to provide them in a “piecemeal fashion,” she said.

“Please don’t do that,” Shiu said. “It’s not in your best interest. It’s not in OFCCP’s best interest. We want to conduct our compliance evaluations in a very fair, neutral, efficient and expeditious way, and this just causes delay. While it may inure to the benefit of some lawyers, it really does not inure to the benefit of advancing equal employment opportunity.”

However, one conference speaker said during a later session that he believes there might have been a “misunderstanding about what was said.”

“I don’t think anyone at ILG, or any consultant or lawyer, is standing up and saying, ‘Don’t give them anything,’ ” said David Cohen, president of DCI Consulting Group Inc. in Washington. “That’s not how we work. We work with them and we negotiate.”

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

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com

Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.

Request Labor & Employment on Bloomberg Law