Showing posts with label compensation. Show all posts
Showing posts with label compensation. Show all posts

Tuesday, January 19, 2016

OFCCP pay transparency rule takes effect Monday January 11th

Constangy Brooks Smith & Prophete LLP, Lexology

The OFCCP’s Final Rule prohibiting federal contractors from discriminating against employees and applicants who ask about or discuss compensation goes into effect this Monday, January 11. The Rule applies to contracts entered into or modified on or after the effective date. Contracts are considered “modified” if there is any alteration in their terms and conditions, including supplemental agreements and extensions. Those contractors with a significant number of contracts may find it easier to use the effective date of the Rule for compliance, rather than try to determine when they have a new or modified contract.

In addition, the OFCCP has issued the mandatory language required for existing employee handbooks or other manuals and that must be posted electronically or in conspicuous places.

Read the story here.

Related content:

Thursday, March 8, 2012

What OFCCP Now expects for Affirmative Action

HR Daily Advisor
Thursday, March 01, 2012 3:00 AM
by Steve Bruce

Desmond, who is a partner in the New Orleans office of national employment law firm Jackson Lewis, made her comments at BLR’s Advanced Employment Issues Symposium, held recently in Las Vegas.

About Goals and Achievement

Under OFCCP (Office of Federal Contract Compliance Programs) rules, where the company’s representation of protected class members is significantly lower than availability, a goal is created. For measuring goal achievement, a placement analysis will show the placement of minorities/females into each job group, including new hire and promotions.

An annual report will document the achievement of goals. This report should be shared with the CEO.

Full Story: http://hrdailyadvisor.blr.com/archive/2012/03/01/Hiring_Recruiting_OFCCP_Affirmative_Action_Plan.aspx

Tuesday, November 29, 2011

Compensating Differentials for Sexual Harassment

Professor Joni Hersch of Vanderbilt University has published a paper that suggests that women who work in workplaces where there is a higher risk of sexual harassment are compensated more for such an environment. The abstract states:

American Economic Review
"Workplace sexual harassment is illegal, but many workers report that they have been sexually harassed. Exposure to the risk of sexual harassment may decrease productivity, which would reduce wages. Alternatively, workers may receive a compensating differential for exposure to sexual harassment, which would increase wages. Data on claims of sexual harassment filed with the Equal Employment Opportunity Commission are used to calculate the first measures of sexual harassment risks by industry, age group, and sex. Female workers face far higher sexual harassment risks. On balance, workers receive a compensating wage differential for exposure to the risk of sexual harassment."

http://www.aeaweb.org/articles.php?doi=10.1257/aer.101.3.630 (To see the entire paper, subscription required or pay-per-view)

Tuesday, July 12, 2011

OFCCP Director Hosts Web Chat on Regulatory and Compliance Issues

On July 12, 2011, OFCCP Director Patricia A. Shiu conducted a web chat that addresses many important issues of concern to federal contractors. The following is brief synopsis of her comments on the issues. To view the entire transcript of the "chat" go to the OFCCP website at: http://www.dol.gov/regulations/chat-ofccp-static-201107.htm.

Notice of Proposed Rulemaking for VEVRAA Regulations:

The comment period for Notice of Proposed Rulemaking on Section 4212 of the Vietnam Era Veterans’ Readjustment Assistance Act closed yesterday and the agency has begun the process of reviewing and analyzing all of the comments. This process may take several weeks to complete, and will include consideration of suggestions for revision to the NPRM. In the Final Rule the agency will describe the comments, the issues they raised, and our responses to them. OFCCP anticipates publishing a Final Rule in the spring of 2012.

Approximately 80 comments were received regarding the proposed rule. In answer to the question whether OFCCP will withdraw the proposed rule in accordance to a demand by various employer organizations, the director said that she would not.

Census Bureau Data for 2010:

OFCCP is working with census bureau, EEOC and Department of Justice in creating the special tab. It should be available in the next 12 months. Contractors should continue to use the 2000 census data until the 2010 data are available. The Census Bureau indicates that it expects to release the 2010 data in December 2012.

Compensation Data Collection Tool:

The Compensation Data Collection Tool ANPRM is in the final stages of review and the agency expects to publish it within the next few weeks.

Regional Vacancies:

OFCCP is currently recruiting for Regional Director in the Midwest Region and Deputy Regional Directors in the Northeast, mid-Atlantic, Midwest and Dallas regions.

Proposed Rescission of Compensation Guidelines:

In response to the proposed rescission people have made the agency aware of the need to develop new guidance. OFCCP is reviewing those comments.

Documenting Good Faith Efforts:
The director stated that there are a variety of ways to document good faith efforts. For example, copies of job postings, correspondence, and documentation of community outreach with public workforce agencies or training and educational organizations. The most important thing is to ensure that you have complete and accurate documentation (e.g. emails, letters of confirmation, job postings, etc.). OFCCP regulations and technical guides have more detailed information: http://www.dol.gov/ofccp/


Section 503 ANPRM:
The Section 503 NPRM is currently under review. Once the review is complete, OFCCP will publish the NPRM for public comment. OFCCP anticipates publication of the Section 503 NPRM in the Federal Register sometime in the next month. The NPRMs for construction and sex discrimination are anticipated for publication on the dates listed in the spring regulatory agenda.

FAAP Agreements:
Contractors are not required to develop a FAAP (Functional AAP) agreement. The regulations specify that contractors who have employees who work at an establishment with fewer than 50 employees have the following options for covering these employees: 1. In an AAP covering just that establishment 2. In an AAP which covers the personnel functions or 3. In the AAP of the managing official to whom they report. The new FAAP directive is available on the OFCCP website. Notification letters were sent to existing FAAP holders to inform them to contact the agency about renewal of the FAAP.

The Revised Scheduling Letter:
The revised scheduling letter was published for comment in May, and the comment period closed July 11th. There were a few comments received. OFCCP is reviewing those comments and will make a determination regarding the letter and the itemized listing in the very near future. There are no new regulatory changes that will be reflected in the current revision.

The Federal Contract Compliance Manual:
The FCCM will be published sometime this fall.

The ACM vs. the ACE:
There are several major differences between Active Case Enforcement (ACE) and Active Case Management (ACM). Under ACE, OFCCP is using all of the compliance evaluation investigative methodologies specified in the regulations (i.e., compliance review, offsite review of records, compliance check and focused review), whereas under ACM, only the compliance review method was used. Under ACM, a full desk audit was only conducted where there were indicators of discrimination or in every 50th review. ACE procedures require a full desk audit in every compliance evaluation. Additionally ACM procedures focused on identifying cases where there were 10 or more affected class members, whereas ACE does not have a minimum affected class member threshold.

Outreach Efforts:
In the first half of the current fiscal year, OFCCP conducted nearly 1,000 outreach events, reaching almost 26,000 stakeholders, including workers, community-based organizations, civil rights groups, employers, human resources professionals, attorneys, consultants, labor unions, veterans’ service organizations and more. OFCCP will continue to participate in these activities. Notices of meetings and events can be found on the agency's website http://www.dol.gov/ofccp.

Inter-Agency Communications:
OFCCP and EEOC, as well as the Department of Justice, have increased communications at all levels. For example, the agencies are conducting joint trainings; coordinating civil rights policies on an ongoing basis; developing pilot programs among the field offices; and sharing best practices. The purpose of this collaboration is to develop a unified civil rights agenda which is part of President Obama’s vision for our agencies.

Does OFCCP always send a notice to the contractor to advise that the audit has been closed? Yes

One trend that OFCCP has observed is that when it identifies major violations, contractors have failed to implement internal, self-audit procedures and failed to implement corrective actions. This has resulted in the agency finding record keeping violations relating to personnel activity and compensation.

Will the proposed scheduling letter update follow OIRA protocol (http://www.reginfo.gov/public/jsp/Utilities/faq.jsp), which includes a second public comment period of 30 days before final approval? If so, will OFCCP seek an emergency extension for the current scheduling letter, which expires 9/30/2011?

Yes, OFCCP is following the OIRA protocol and will provide an opportunity for a second round of comments on the proposed updates to the scheduling letter.

Databases Used for Contractor Selection:
OFCCP uses several databases to determine whether an employer is a federal contractor. Examples include Central Contractor Registration (CCR), Federal Procurement Data System-New Generation (FPDS-NG), EEO-1 Surveys, and Dun & Bradstreet. CCR captures registration information of all federal contractors. FPDS-NG captures all transactions of federal contracts. OFCCP receives EEO-1 reports from the U.S. Equal Employment Opportunity Commission for all businesses that self-report as federal contractors. Finally, Dun & Bradstreet captures name, address, family tree, and DUNS numbers for all facilities and subsidiaries of a business.

Worker Misclassification:
Worker misclassification is an important issue for the OFCCP because Federal contractors must include all their workers in their compliance plans and not mask some by classifying them as independent contractors. As part of the Secretary’s department-wide “Plan Prevent and Protect” initiative, OFCCP is working with other DOL agencies on this misclassification issue.

Accomplishments:
In the first six months of Fiscal Year 2011, OFCCP has completed 44 financial conciliation agreements that include $5.66 million and 657 job offers for 8,090 victims. This compares favorably to the same period last year when the agency had completed 35 financial CAs totaling $2.77 million and 582 job-offers for 3,157 victims. This represents a 25 percent increase in CAs, more than double the financial remedies and, most importantly, an increase in job opportunities for workers who faced discrimination.

Monday, July 11, 2011

OFCCP Releases its Semi-Annual Regulatory Agenda

The U.S. Department of Labor's Office of Federal Conract Compliance Programs (OFCCP) has released its Semi-Annual Regulatory Agenda. According to the Director, Ms. Patricia A. Shiu, the agency plans to amend the regulations in order to "bring greater scrutiny to current and past regulations in order to more fully prepare for the future, modernizing our policies and practices to adjust to a changing workforce." Among the regulations to be amended will be the OFCCP's Sex Discrimination Guidelines, which have not been changed since 1978; the veterans' regulations and the Section 503 disability regulations. The agency also plans to amend the regulations regarding women and minorities in the construction trades.

OFCCP is also planning to release a new tool on compensation. According to Ms. Shiu, "This data will be critical to realizing President Obama’s vision of ending, once and for all, the persisting gap in wages between men and women, especially women of color. "

OFCCP is seeking input on the agency's regulatory agenda. On Tuesday, July 12, OFCCP will host a live web chat from 1:00-2:00 PM (EDT) to discuss OFCCP’s regulatory agenda and answer your questions. You may join the chat by going to www.dol.gov/regulations. On the website you will find information about the Department’s entire agenda, including fact sheets, videos and archival material. You can also register to receive a reminder for the web chat.

Monday, March 28, 2011

More News from OFCCP Action on Compensation Standards, CSALs, and I-9s

HR.BLR.Com March 22, 2011 OFCCP is rapidly earning the reputation as the agency that “never sleeps.” There have been big changes at OFCCP, including the notice of proposed rulemaking for Section 503 of the Rehabilitation Act, an interim final rule requiring disclosure of executive compensation, the discontinuation of functional affirmative action plans (AAPs), and the agency’s intention to rescind its 2006 voluntary guidelines for self-evaluation of compensation practices. Full Story: http://hr.blr.com/HR-news/Discrimination/Affirmative-Action/More-News-from-OFCCP-Action-on-Compensation-Standa/

Monday, April 26, 2010

Court: Wal-Mart gender pay lawsuit can go to trial

Cnn.com
By Bill Mears, CNN
Washington (CNN) -- A federal appeals court has certified the largest class-action employment lawsuit in U.S. history, in a long-standing dispute against retailer Wal-Mart Stores Inc. over alleged gender bias in pay and promotions.
The divided 6-5 ruling by the San Francisco-based 9th U.S. Circuit Court of Appeals on Monday allows the combined multiparty litigation to move ahead to trial, where a decision against the company could result in billions in damages. The Arkansas-based chain of stores has the option of appealing Monday's ruling to the U.S. Supreme Court for review.
At issue is whether more than a million current and former Wal-Mart employees can band together in their claims of discrimination, which they say has occurred over the past decade, at least.

Full Story: http://www.cnn.com/2010/CRIME/04/26/walmart.suit/index.html

Wednesday, April 21, 2010

When it Comes to Equal Pay, Who's Worse Off--Women JDs or Women MBAs?

AmLawDaily
April 20, 2010 6:35 PM

by Vivia Chen
Tuesdsay was Equal Pay Day, but women had little reason to celebrate given how far they lag behind men in compensation. Currently in the U.S., women earn 77 cents for every dollar earned by men, according to data from the U.S. Census Bureau.
"Twenty-three cents might not sound like a lot until you do the math," wrote Ilene Lang, president of Catalyst, a nonprofit organization working to achieve greater equality and opportunities for working women. "The small nicks to a woman's paycheck add up to astonishing amounts. A woman who graduates high school will earn roughly $700,000 less than her male classmates over the course of her life. A female college graduate will earn $1.2 million less."
Also, women holding professional degrees (JDs, MBAs, and MDs) fare even worse--over the course of their careers, they will earn $2 million less than the men in their graduating class, says Lang. "How's that for a graduation gift?" (Lang was writing in a column posted early Tuesday on Catalyst's blog, Catalyzing.)

Full Story: http://amlawdaily.typepad.com/amlawdaily/2010/04/payday.html

Sunday, April 18, 2010

Employers Urged to Save Pay Documents

Workforce Management
To defend themselves against allegations of discriminatory pay practices, employers may have to go back decades to provide documentation to defend against those claims. Such records may include payroll files, compensation programs, performance reviews and any of the decisions and guidelines around starting pay, promotional pay and merit increases. By Judy Greenwald
February 2010

The Lilly Ledbetter Fair Pay Act of 2009 has led many employers to re-examine their document retention policies so they’ll be prepared if they are sued under its provisions, but some experts say more work needs to be done.
The act provides that every paycheck resulting from a previous discriminatory pay decision constitutes a violation of several federal laws, meaning employers may have to go back decades to provide documentation to defend against such claims.
A survey released in August 2009 by Hewitt Associates of 1,156 organizations found that 88 percent were aware of the law. It found that 38 percent had conducted a pay-equity analysis, but 36 percent had taken no action in response to the law.
“Now that litigation over compensation decisions can potentially reach back 20 years or more, it’s become important for employers to hold on to records of when and why certain compensation decisions were made,” says Jeffrey D. Polsky, a partner with law firm Fox Rothschild in San Francisco.

Full Story: http://www.workforce.com/archive/feature/27/03/36/index.php

Tuesday, September 1, 2009

EEOC Amends Compliance Manual to Clarify Ledbetter Timeliness Issues

The U.S. Equal Employment Opportunity Commission has revised its Compliance Manual to comply with the recently enacted Lilly Ledbetter Fair Pay Act. In the manual the Commission states:

"In August 2009, the EEOC issued a revision of the "Threshold Issues" Compliance Manual section to address the time limitations for filing charges alleging compensation discrimination pursuant to the Lilly Ledbetter Fair Pay Act of 2009. The time limitations for filing compensation discrimination charges is addressed in the new subsection § 2-IV C.4, "Compensation Discrimination." "

In the Compensation section, the Commission writes:

4. Compensation Discrimination
An aggrieved individual can bring a charge up to 180/300 days after receiving compensation that is affected by a discriminatory compensation decision or other discriminatory practice, regardless of when the discrimination began. (Emphasis added.) If a charge alleges compensation discrimination under Title VII, the ADA, the Rehabilitation Act, or the ADEA,(198) the filing period begins when any of the following occurs: 1) the employer adopts a discriminatory compensation decision or other discriminatory practice affecting compensation; 2) the charging party becomes subject to a discriminatory compensation decision or other discriminatory practice affecting compensation; or 3) the charging party’s compensation is affected by application of a discriminatory compensation decision or other discriminatory practice, including each time wages, benefits, or other compensation is paid, resulting in whole or part from such discriminatory decision or practice.(199)
Payment of compensation is actionable if it is affected by either a discriminatory compensation decision or some other discriminatory practice. For example, a charging party may challenge within 180/300 days any paycheck that is lower than it otherwise would be because of the discriminatory denial of a career ladder promotion. In a career ladder promotion, an individual is promoted to a higher pay and/or grade level based on whether that individual meets certain predetermined performance, time-in-grade, or other criteria.
Example - After working for the Respondent for nearly 10 years as a production supervisor, CP learns she is being paid less than the other four production supervisors in her department, who are all men. Immediately after learning about the pay discrepancy, CP files an EEOC charge alleging sex-based wage discrimination in violation of Title VII. The investigation shows that CP generally received lower pay raises than her male counterparts as the result of lower performance ratings, which CP alleges to have been discriminatory. Although these performance ratings and related pay raises all occurred more than 300 days before CP filed her charge, they affected her pay within the filing period. Therefore, CP’s pay discrimination charge is timely.
These time frames apply to all forms of compensation, including the payment of pension benefits. However, because the congressional findings state that “[n]othing in [the Lilly Ledbetter Fair Pay Act] is intended to change current law treatment of when pension distributions are considered paid,”(200) it may be determined that pension benefits are considered paid “upon entering retirement and not upon issuance of each annuity check. ”(201) Therefore, to avoid potential timeliness issues, an individual who is considering challenging his or her pension benefits is strongly encouraged to file a charge within 180/300 days after retirement.

http://www.eeoc.gov/policy/docs/threshold.html#2-IV-C-4

Monday, October 20, 2008

GAO Issues Report On EEOC and OFCCP Pay Discrimination Enforcement

On August 11, 2008, the Government Accountability Office (GAO) issued a report critical of the enforcement of pay discrimination laws by the Equal Employment Opportunity Commission (EEOC) and the Department of Labor's Office of Federal Contract Compliance Programs (OFCCP). The report entitled, "Women's Earnings: Federal Agencies Should Better Monitor Their Performance in Enforcing Anti-Discrimination Laws," analyzed the equal employment opportunity laws enforced by the EEOC and OFCCP that are intended to prohibit discrimination on the basis of compensation, among other prohibited bases. Noting that in 2000, the gender wage gap was 80 percent, and that a portion of that gap was due to discrimination, GAO examined "(1) how EEOC enforces laws addressing gender pay disparities among private sector employers and provides outreach and what is known about its performance, and (2) how Labor enforces laws addressing gender pay disparities among federal contractors and provides outreach and what is known about its performance." http://www.gao.gov/products/GAO-08-799

As for EEOC, GAO concluded: "EEOC does not monitor gender pay enforcement efforts under another statute that covers multiple discrimination topics and under which more than half of gender pay charges are filed. As a result, EEOC does not make complete use of available information to help identify trends related to gender pay cases, set agency priorities, or understand how its gender pay enforcement efforts are contributing to overall performance goals relative to other efforts." Similarly, regarding OFCCP, the GAO made the following observations, among others: "[R]egulations require contractors to conduct a self-evaluation of their compensation systems to identify and address gender pay disparities. However, OFCCP's guidance on this is found in different source documents that are not cross-referenced, and its data system lacks a unique code to help the agency easily determine the extent to which contractors are complying with the self-evaluation requirement."

The GAO's recommendations are as follows:

Recommendations for Executive Action
Recommendation: To gauge how well EEOC is carrying out its responsibilities regarding gender pay discrimination, the Chair of the EEOC should devise a cost-effective method to improve its ability to monitor the performance of its gender pay enforcement efforts relative to other areas, using information already captured in its databases and supplementing information already reported.Agency Affected: Equal Employment Opportunity Commission Status: In process Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To strengthen OFCCP's enforcement and outreach efforts and gauge the performance of those efforts, the Secretary of Labor should direct the Director of OFCCP to evaluate the Westat mathematical model and incorporate lessons learned from the prior model to ensure contractors are appropriately being selected for compliance evaluations and to maximize limited enforcement resources.Agency Affected: Department of Labor Status: In process Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To strengthen OFCCP's enforcement and outreach efforts and gauge the performance of those efforts, the Secretary of Labor should direct the Director of OFCCP to improve oversight of compliance evaluations for contractors by establishing linkages between relevant and current guidance on conducting compensation self-evaluations and devising a unique violation code to document any non-compliance with the compensation self evaluation requirement.Agency Affected: Department of Labor Status: In process Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To strengthen OFCCP's enforcement and outreach efforts and gauge the performance of those efforts, the Secretary of Labor should direct the Director of OFCCP to ensure the planned new data system incorporates standardized data entry instructions and adequate internal controls to screen for erroneous, inconsistent, or missing data, and ensures violation codes are correctly entered.Agency Affected: Department of Labor Status: In process Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To strengthen OFCCP's enforcement and outreach efforts and gauge the performance of those efforts, the Secretary of Labor should direct the Director of OFCCP to develop a cost-effective means for monitoring performance of gender pay enforcement efforts relative to other areas, using information generally already captured in existing databases, once determined reliable.Agency Affected: Department of Labor Status: In process Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To strengthen OFCCP's enforcement and outreach efforts and gauge the performance of those efforts, the Secretary of Labor should direct the Director of OFCCP to devise a method for systematically collecting feedback from recipients of outreach and technical assistance and using this information to measure and monitor outreach performance.Agency Affected: Department of Labor Status: In process Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

To read the entire report, go to: http://www.gao.gov/new.items/d08799.pdf

Wednesday, October 1, 2008

Diversity's Bottom Line

AMLAWDaily
September 30, 2008 11:21 PM
Posted by Dimitra Kessenides
By Susan Hansen
Excerpted from the Fall 2008 issue of Minority Law Journal

Even in an era of $160,000 salaries for first-year associates--plus bonuses--not every young lawyer is feeling equally flush. Law school debt and the uncertainty of today's tumultuous markets have left many associates feeling squeezed--and a lot of them are minority lawyers.
This year our Minority Experience Study focused on the economic life of big-firm midlevels. Comparing responses from young attorneys of different racial groups, we found that African American associates, in particular, generally appeared to be in a less secure financial position. They, together with Hispanic lawyers, reported higher levels of debt and lower bonus compensation compared to their white and Asian American counterparts. More black attorneys said that their workloads were too light, and overall they reported lower billable hours, even though they took less of the vacation that they're entitled to than other groups.
As in previous years, the Minority Experience Study drew on data collected by our sibling publication The American Lawyer for its Midlevel Associates Survey. The survey, conducted in spring 2008, includes 7,259 third-, fourth-, and fifth-year associates at 180 large law firms who identified their racial background, including 5,390 whites, 539 Asian Americans, 241 Hispanics, and 212 African Americans. (The 877 survey respondents who did not specify their race were not included in the Minority Experience Study.)
The economic disparities among different groups of associates begin early. More than 90 percent of Hispanic and African American lawyers reported that they borrowed money for law school, while just over 80 percent of whites did. Only about three-quarters of Asian American attorneys took out law school loans. Black and Hispanic attorneys were also more likely to have taken out loans of more than $100,000.
To several diversity professionals, those numbers aren't surprising. Since minorities are more likely to have lower incomes, they note, fewer African American and Hispanic families can help their children foot the bill for law school. Furthermore, our survey found, lawyers of color were often more likely to have chosen to work at law firms because of that debt. More than half of African American and Hispanic lawyers said that law school loans were a major factor in their decision to join a firm, compared to just under 40 percent of white and Asian American midlevels.
One financial gap that shows up on our survey is in the area of compensation. Both African American and Hispanic respondents report an average base salary of about $178,000. White associates say they make $184,000, on average, and Asian American associates say they make $195,000. [To read the entire story, go to: http://amlawdaily.typepad.com/amlawdaily/2008/09/post-5.html ]

Thursday, November 8, 2007

OFCCP Issues New FAQs on Reviews of Compensation Practices

The Department of Labor's Office of Federal Contract Compliance Programs (OFCCP) has issued Frequently Asked Questions (FAQs) on its reviews of contractors' compensation practices. These FAQs are not intended to be comprehensive, however, but address its recently released revised procedures for reviewing compensation data while conducting compliance evaluations. These FAQs also address the Department of Labor's position regarding the implications of the Supreme Court's Ledbetter decision on agency compliance actions regarding compensation. For more information, go to: http://www.dol.gov/esa/regs/compliance/ofccp/faqs/emprnewfaqs.htm

FREQUENTLY ASKED QUESTIONS:
What process does OFCCP use to review a contractor's compensation practices?
Has OFCCP developed procedures for conducting a desk audit of a contractor's compensation practices?
What should a contractor expect when a desk audit of its compensation practices reveals an indicator of potential compensation discrimination?
What is the impact of the Supreme Court's decision in Ledbetter v. Goodyear Tire & Rubber Co. on OFCCP compensation evaluation and enforcement practices?
Back to Top
What process does OFCCP use to review a contractor's compensation practices?
OFCCP uses a tiered review process to conduct most compliance evaluations. This tiered review consists of an initial desk audit review followed, where indicated, by either a focused review or a full compliance review. OFCCP examines a contractor's compensation practices as part of every tiered review.
In addition, OFCCP conducts a full compliance review on a certain percentage of contractors scheduled for a compliance evaluation. During a full compliance review, OFCCP examines a contractor's total employment process, including its compensation practices.
Back to Top
Has OFCCP developed procedures for conducting a desk audit of a contractor's compensation practices?
Each of OFCCP's regional offices uses the same basic procedures for conducting a desk audit review of a contractor's compensation practices. Generally speaking, during a desk audit, the agency will examine the following three criteria when evaluating a contractor's compensation practices:
Whether, for at least one pay division, there is a specified difference in average compensation between the groups being compared and, if so, whether at least one group appears to be adversely affected.
After combining the pay divisions meeting the above condition, whether the number of employees in the non-favored group is greater than a specified number and represents a specified percentage of the total employees in that group in the overall workforce.
Whether the overall percentage of the group most adversely affected in the combined pay divisions is larger, by a specified amount, than the overall percentage of the other groups adversely affected.
The specific thresholds used in each of the three criteria above are not static, but rather are subject to change as OFCCP continues to evaluate its targeting methodology.
Back to Top
What should a contractor expect when a desk audit of its compensation practices reveals an indicator of potential compensation discrimination?
OFCCP does not consider the outcome of a desk audit to be a final indicator of discrimination. The desk audit is a screening procedure to identify areas requiring further review, including additional data requests, on-site investigation, or witness interviews.
When indicators are found, OFCCP will request detailed information on each employee in the overall workforce or appropriately determined subset. The information requested will cover those factors which OFCCP has observed to generally influence pay, as well as any influencing factors specific to the contractor. OFCCP may request data regarding any or all of the following factors, as appropriate:
Employee ID number or suitable ID for matching purposes
Gender
Race / Ethnicity
Job Title
Grade level or salary classification
Employee location
Time with the company or date of hire
Time in current job or date of last change in grade/title
Date of Birth
Current salary, hourly or annually
Part-time, Full-time, or Temporary status
Exempt or Non-exempt status
The specific additional data requested by OFCCP will vary depending on the contractor's pay system and the agency's investigation. However, OFCCP has found that the above data is often helpful in examining a contractor's compensation practices. Contractors are encouraged to provide this data to OFCCP electronically whenever possible.
If an evaluation of this additional data continues to reveal an indication of discrimination, then OFCCP will review the contractor's compensation practices under the Interpretative Standards for Systemic Compensation Discrimination under E.O. 11246 to determine if a violation of the law has occurred.
Back to Top
What is the impact of the Supreme Court's decision in Ledbetter v. Goodyear Tire & Rubber Co. on OFCCP compensation evaluation and enforcement practices?
In Ledbetter v. Goodyear Tire & Rubber Co., 127 S.Ct. 2162 (2007), the Supreme Court held that an allegation of pay discrimination under Title VII by a single employee is a discrete employment action that must be challenged within 180 (or 300) days of the allegedly discriminatory pay decision. OFCCP does not believe that Ledbetter invalidates its Interpretative Standards for Systemic Compensation Discrimination under E.O. 11246 ("Standards"). The agency will continue to use statistical analysis, including multiple regression techniques, to discover class-wide salary disparities of a systemic nature. As it has in the past, the agency will gather all relevant data regarding the factors that actually influenced the contractor's compensation systems or pay decisions as a whole and will continue to supplement any statistical analyses with anecdotal evidence of discrimination, as discussed in the Standards.
While OFCCP is still examining the impact of Ledbetter in specific cases, nothing in the decision permits a contractor to refuse to provide requested compensation data. To the extent a contractor wishes to present data regarding specific pay decisions, the data will be accepted and evaluated in conjunction with the data items requested by OFCCP.

Thursday, August 23, 2007

OFCCP Director Discusses Developments

OFCCP Director Discusses Developments With Contractors' EEO Representatives
Thursday, August 23, 2007

NEW YORK--A recent U.S. Supreme Court decision on when pay discrimination claims must be filed under Title VII of the 1964 Civil Rights Act does not "directly affect" the obligations of federal contractors to provide data on employee compensation to the Labor Department, Office of Federal Contract Compliance Programs Director Charles James said Aug. 22.
Speaking at the 25th annual conference of the Industry Liaison Group in New York, James said the Supreme Court's 5-4 decision in Ledbetter v. Goodyear, in which the court held that a female supervisor had waited too long to file a Title VII charge of alleged sex discrimination in pay (103 DLR AA-1, 5/30/07 ), does not change OFCCP procedures that require federal contractors to demonstrate compliance with Executive Order 11246, which prohibits sex discrimination and requires affirmative action.
James, the deputy assistant secretary of labor for federal contract compliance programs since 2001, told more than 600 equal employment opportunity specialists attending the conference that nothing in the Ledbetter decision would permit contractors to refuse to provide compensation data to DOL's OFCCP. The ILG conference brings together industry EEO specialists responsible for compliance with EO 11246, Section 503 of the Rehabilitation Act, and the veterans' statutes enforced by OFCCP and government personnel from that agency and the Equal Employment Opportunity Commission.
In the wake of Ledbetter, OFCCP will continue to use its existing standards for determining whether documented differences in pay among similarly situated employee groups amount to unlawful discrimination, James said. He explained that the Supreme Court case involved a "discrete employment action" and was "all about timing" under the applicable statute of limitations under Title VII rather than the "content" of a pay discrimination claim. He pointed out that in reviewing federal contractors' employment policies, OFCCP looks at compensation systems as a whole, and Ledbetter provides no excuse for contractors not to cooperate with agency audits.
James also noted that the House already has passed legislation that would overrule the court's decision in Ledbetter and the bill is now pending before the Senate (147 DLR AA-1, 8/1/07 ). The administration has indicated that if the Senate passes the bill, President Bush would veto the legislation, he said. "All I can say is stay tuned," James said.

[For the entire story, go to: http://pubs.bna.com/ip/bna/dlr.nsf/eh/a0b5a9k0e0 - subscription required]