In connection with the publication of the NPRM on the pay data reporting tool last week, today the proposed Equal Pay Report (Equal Pay Report) and Instructions, as well as a Supporting Statement, were released to the public.  The Equal Pay Report is to be filled annually by employers through a yet-to-be released online filing system.

As set forth in the proposed regulations, the form is designed to collect summary pay data by EEO-1 category for males and females by race/ethnicity. Race, ethnicity and job categories are the same as in the EEO-1 Report.

Additional details are as follows:

  • The filing period for the Report is January 1 to March 31 of each year.  The Report must be submitted annually to OFCCP no later than March 31 of each year.
  •  The Report must include total W-2 Wage and Tax Statement (W-2) earnings and total work hours for the calendar year, January 1 – December 31, for all employees included in your most recent EEO-1 Report.
  • The Report must include all employees whether or not they are still employed on December 31st.
  • Total work hours means all work hours for each employee in each race/ethnicity and job category during the calendar year.

Work hours are calculated as follows:

  • For salaried workers actual hours of work must be provided, if available.  Otherwise, you may use 2,080 hours for full-time employees and 1,040 for part-time employees.
  • For hourly workers, provide actual hours of work.
  • Reported hours may also be adjusted for part year work using date of hire or dates of absence (e.g., vacation or leave), but this is not required.

As with the EEO-1 Report, the EPR will require employers to provide Dun and Bradstreet numbers as well as North American Industry Classification System (NAICS) codes.  OFCCP has indicated its plans to make data received in the EPRs public by industry.

Similar to the EEO-1 Report, employers have the option to file a single-establishment report or multiple-establishment reports for each establishment “regardless of the establishment’s size” as well as a headquarters report.  There is no “consolidated report” requirement as is the case with the EEO-1.

The report will also require employers to certify the accuracy of the report prior to submission.

The window to submit public comments on the NPRM and associated form and instructions will remain open until early November.

Rounding out the festivities in Washington, D.C., OFCCP Director Pat Shiu addressed attendees on the closing morning of the 32nd Annual ILG National conference.  Keeping to the conference theme of “Learning from the Legacy, Focusing on the Future,” Director Shiu’s remarks centered around the “unfinished business of America” to address issues of pay, sexual orientation and gender identity non-discrimination and other areas President Obama has addressed in recent months through his Executive Actions.

Speaking to the federal contractors in the room, Director Shiu impressed upon them her believe that, as employers, they have “the power to create the ripples of hope” and that government contractors can lead the way in effectuating change by modeling best behaviors and best practices.  Director Shiu committed to “facilitating [contractor] success” and acknowledged OFCCP “does not operate in a vacuum.”

This past year has certainly brought a lot of change for the contractor community with still more changes to come.  We will continue to keep you updated on any new developments and additional insights into these “world changing” obligations.  So, as always, stay tuned for more . . .

The second full day of the 32nd Annual ILG National Conference was filled with a multitude of presentations by practitioners and government officials.

The day started with a joint agency presentation by representatives from EEOC, Department of Justice and OFCCP.  One of the “hot topics” discussed was the anticipated release of the long-awaited proposed revisions to OFCCP Scheduling Letter.  Debra Carr, Director of Policy and Program Development for OFCCP, reported she expected release of the Scheduling Letter, currently sitting with OMB, in the next couple of months.

After a day of informative discussions about enforcement topics including, steering, compensation and adverse impact, OFCCP Regional Directors and National Leadership held a panel discussion with attendees.

This year’s conference wraps-up tomorrow with an address from OFCCP Director Patricia Shiu.  We’ll be sure to share any newsworthy notes from her address so be on the lookout for tomorrow’s post.

As we reported earlier today, OFCCP has announced proposed regulations to satisfy President Obama’s mandate that contractors submit detailed pay data.    The NPRM will be officially published in the Federal Register this Friday with a 90 day public comment period after that.

As proposed, the data collection tool, called the Equal Pay Report (EPR) in the NPRM, is an annual supplement to the EEO-1 Report.  The NPRM proposes the following:

  • Annual report to be filed in the first quarter of every year
  • Required for Employers with 100 or more employees
  • To be filed separately for each establishment
  • Report W-2 earnings for all employees aggregated by EEO-1 category – so employers must report on total comp, as opposed to base comp like most employers include in AAP submissions to OFCCP
  • Report aggregated hours for all non-exempt employees by EEO-1 category – and for all exempt employees if tracked by the employer

We continue to digest the 150 pages of the NPRM and will continue to post detailed analyses of the proposed Equal Pay Report and accompanying regulations.  Stay tuned.

The 32nd Annual ILG National Conference opened this morning with an address from Secretary of Labor Thomas Perez.  This was the first time a sitting Secretary addressed the group, and Secretary Perez hoped it would not be the last.  In his remarks, the Secretary acknowledged the “good work” employers have done in past months to increase jobs, noting 22% of the workforce is employed by federal contractors, but commented his belief that the work is not yet done.  To that end, the Secretary relayed to the group the sentiment that while there are many different types of employers “we are in the same orchestra and that is the orchestra of opportunity and you’re sitting in the front row.”

Continuing with his commitment to listen to employers, Secretary of Perez encouraged attendees to “never hesitate to let him know if they think we are screwing up.”  Stating “I don’t know what I don’t know”, the Secretary repeated his desire to hear from contractors about their concerns, trepidations, and positive feedback.

There was speculation that Secretary Perez would unveil during his remarks this morning the much anticipated pay data collection tool or speak to other forthcoming Department of Labor regulations.  This was not the case; however, we have learned that OMB has released the details of the pay data collection tool to be published in the federal register on Friday – which coincides with OFCCP Director Pat Shiu’s address to the conference.  As we learn more about the details of the tool we will make sure to provide you with an update.

We have learned OMB has today released the proposed pay data collection tool to be published in the Federal Register on Friday.  Once published, the public will have 90 days to submit comments.  Details are still emerging on this breaking news.  We will update you as soon as we learn more so make sure to stay tuned.

Hello from the 2014 ILG National Conference in beautiful Washington, D.C.  The theme of this year’s conference is “Celebrate 50 Years of Civil Rights” and the conference opens tomorrow morning with an address from Secretary of Labor Thomas Perez.  Key officials from OFCCP and EEOC as well as leading practitioners are scheduled to present throughout the remainder of the week.  With all of the new regulations and executive orders impacting federal contractors, this year’s conference is going to be chockfull of invaluable insights and information about contractor compliance obligations and enforcement trends.  We’ll bring you the highlights and key take-a-aways so make sure to keep an eye out for our updates.

In the latest in a series of recent Executive Orders signed by the President,  creating significant additional burdens for federal contractors, the President signed today the “Fair Pay and Safe Workplaces Executive Order”.  In addition to releasing the EO, the White House also published a fact sheet on the new obligations contained in the EO.

The EO is misleadingly named in that it primarily covers topics other than fair pay and safe workplaces – these topics are covered among the wide-ranging set of new obligations.  The new requirements will include:

  1.  Federal Agencies considering the three-year record of labor and employment law violations when making contract award decisions,
  2. Contractor reporting of violations of employment laws,
  3. Contractor provision of information to employees to allow them to “verify the accuracy of their paycheck”, and
  4. Prohibition on mandatory arbitration agreements to resolve claims of civil rights violations.

Agencies will be required to take into account violations of 14 Federal statues (and equivalent state laws) when considering contract awards.  Contractors and subcontractors will be required to report violations of these same laws.  Among others, these laws include:

  • Fair Labor Standards Act,
  • Occupational Safety and Health,
  • National Labor Relations Act,
  • Family and Medical Leave Act,
  • Davis Bacon,
  • Service Contract Act, and
  • Title VII of the Civil Rights  Act,
  • Americans with Disability Act,
  • Age Discrimination in Employment Act,
  • Executive Order 11246,
  • Vietnam Veterans Readjustment Assistance Act,
  • Section 503 of the Rehabilitation Act, and
  • Executive Order 13658 (federal contractor minimum wage)

We anticipated much of what was in this Executive Order but there was also one big surprise – a provision prohibiting contractors and subcontractors from requiring new employees enter into pre-dispute mandatory arbitration agreements.  Many employers require employees to sign arbitration agreements at the outset of employment.  This provision of the EO is a “game changer” that government contractors and subcontractors must review and determine how to respond.  It is possible employers will bring litigation challenging this provision of the EO.

In an effort to assist contractors with the burden of the above, and existing reporting obligations, the Executive Order tasks the General Services Administration to develop a single website for contractors to meet their reporting requirements.

This is a breaking story.  We are doing a “deep dive” into the many details.  Stay tuned for additional posts in the upcoming days as we analyze the details and implication of these new obligations.

As OFCCP tries to find new ways to attack the “pay gap,” the Agency is focused increasingly on novel and creative methods to uncover alleged pay discrimination.  These “outside the box” investigations look beyond simply pay decisions (starting salary and pay adjustments) and instead examine employee selection processes – such as hiring decisions – and the impact of these processes on pay.  In that vein, OFCCP recently has greatly increased its focus on “steering” – a theory of discrimination alleging that an employer assigns newly hired employees into different (typically) entry-level positions with different pay rates based on race and/or gender.  A classic example is when new male employees disproportionately are hired for the heavier lifting production entry-level jobs in the warehouse while female entry-levels are hired into the warehouse “clean up” positions (which pay less).

These increasingly common steering investigations often are extremely time-consuming and burdensome on employers.  Moreover, OFCCP is starting to get big results with this innovative approach.   Most notably, in late 2013, G&K Services Co. agreed to settle claims of pay discrimination with OFCCP for more than $265,000.  OFCCP alleged the Company steered female applicants into lower paying “light duty” jobs upon hire.

Contractors should use their affirmative action plan data to identify whether the hallmarks of steering exist in their workforce.  Specifically, contractors should examine jobs that are on the same or similar level (such as entry-level production jobs) with differing pay rates for concentrations by race and/or gender.  If identified, closely examine how those concentrations came about – whether self-selection by applicants (good) or decisions made by recruiters or managers (potentially bad).  If the latter, determine whether there are job-related reasons for the decision-makers disproportionately selecting applicants of a specific race/gender for particular positions.

This is a rapidly developing area of OFCCP enforcement and Jackson Lewis is defending many steering investigations around the country.  We will present a session at the ILG national conference next week in DC on how best to avoid and (when necessary) effectively respond to OFCCP steering investigations.  If you plan to attend the conference, please join my colleagues Matt Camardella and Michelle Duncan as they present on this increasingly important issue.

Earlier this week, OFCCP delivered to the Office of Management and Budget (OMB) proposed regulations implementing the President’s recent Executive Order 13665 prohibiting employers from retaliating against employees for discussing their pay.  A White House Fact Sheet provides more information on how the proposed regulations fit into the President’s pay initiatives.

After OMB reviews (and approves) of the proposed regulations, the public will have the opportunity to comment on OFCCP’s proposed rules.  OMB’s review generally takes 90 days, but this time period may be shorted or extended as needed.  In fact, according to the OMB timetable, the Notice of Proposed Rule Making (containing the proposed rules) is due in September.

We will make sure post an update when the regulations have been released for public consumption.