OFCCP Week In Review, authored by John C. Fox, Candee J. Chambers, and Cynthia L. HackerottThe DE OFCCP Week in Review (WIR) is a simple, fast and direct summary of relevant happenings in the OFCCP regulatory environment, authored by experts John C. Fox, Candee J. Chambers and Cynthia L. Hackerott. In today’s edition, they discuss:

Wednesday, September 6, 2023: 2022 EEO-1 Component 1 Instruction Booklet Posted

Booklet Reflects Changes OMB Approved Last Month

DE Executive Director Chambers Expects Recent Revisions Will Make Filing Easier

Official Seal of the EEOC featuring Bald Eagle and bannerAs anticipated, the U.S. Equal Employment Opportunity Commission (“EEOC”) posted the 2022 EEO-1 Component 1 Instruction Booklet (“Instruction Booklet”) on its EEO-1 data collection landing page. In its announcement, the agency stated:

“As part of its ongoing modernization efforts and in response to feedback from filers in prior collections, the EEOC’s Office of Enterprise Data and Analytics (OEDA) has redesigned the EEO-1 Component 1 Instruction Booklet to better meet the needs of filers. The Instruction Booklet consolidates existing filer-support materials, including frequently asked questions (FAQs) and fact sheets, into a single resource for filers and provides additional information to clarify reporting requirements. Like the dedicated EEO-1 Component 1 website launched by the EEOC in 2021, the updated Instruction Booklet will serve as a “one-stop-shop” containing important information for new and returning filers.”

The EEOC anticipates posting the updated 2022 EEO-1 Component 1 Data File Upload Specifications for filers on Wednesday, September 13, 2023.

Last week, we reported that the EEOC set October 31 as the Opening Date for its 2022 EEO-1 Survey Component 1 Data Collection with the filing deadline on December 5, 2023.

Revisions Approved Last Month

We also reported in our story last week that, on August 8, 2023, the White House Office of Management and Budget (“OMB”) approved the EEOC’s pending proposed changes, including the EEOC’s proposal to eliminate various “types” of EEO-1 reporting  (i.e., by discontinuing the requirement for “Type 4” and “Type 8” EEO-1 reports), but ONLY for one year. This OMB action was unusual because OMB approvals for “information collection requirements” under the Paperwork Reduction Act, such as the EEO-1 Survey, are normally for three years. Our story last week discussed in detail what is going on behind the scenes of the OMB’s unusual decision, specifically how the OMB is gearing up for revised race and ethnic data collection standards and how the EEOC is now set up to propose its anticipated Component 2 Data Collection.

Discussion of the Recently Approved Revisions in the New Instruction Booklet

The EEOC discusses on page 13 of its Instruction Booklet the revisions OMB approved last month (elimination of the Type4 and Type 8 EEO-1 Reports and the creation of a new “Establishment Level Report”):

“Establishment-Level Report

A multi-establishment employer is required to submit and certify an “Establishment-Level Report” for each non-headquarters establishment of the employer regardless of the number of employees at the establishment. The “Establishment-Level Report” must include demographic data for all the employer’s employees at each establishment, as well as any remote employees who report to the establishment, categorized by job category and sex and race or ethnicity.

Beginning with the 2022 EEO-1 Component 1 data collection, multi-establishment employers will no longer be required to file a separate “type” of establishment report based on the size of an individual non-headquarters establishment (i.e., establishments with 50 or more employees or establishments with fewer than 50 employees). Rather, in place of the “Type 4” and “Type 8” establishment reports and the former “Type 6” establishment list report, there will be a newly named “Establishment-Level Report.” All multi-establishment employers will use an “Establishment-Level Report” to submit establishment-level employee demographic data for each of their non-headquarters establishment(s) regardless of size.

With this change, a multi-establishment employer will no longer have to take the additional step of counting employees in each establishment to determine whether to file a “Type 4” or “Type 8” establishment report. Multi-establishment employers will still be required to submit a “Headquarters Report” and a “Consolidated Report.” However, all individual “Consolidated Reports” for multi-establishment employers will be auto-populated and auto-generated with data from their “Headquarters Report” and each “Establishment-Level Report” within the OFS.”

[citation references omitted] [See also footnotes 33-36]

DE’s Candee Chambers: “The Mechanics to File Reports Should Be Easier”

DirectEmployers Executive Director Candee Chambers (Executive Editor and Publisher of the WIR) filed EEO-1 Reports for over two decades and weighed in on how these changes will impact employers filing their 2022 EEO-1 Component 1 Reports:

“Eliminating the Type 4 and Type 8 establishment reports should be relatively easy moving forward because the HRIS groups will just need to report employees by establishment (which federal contractors most likely already do for their OFCCP Affirmative Action Programs) and count them by race, gender, ethnicity, etc., and eliminate the division into the various types of ‘over 50 employee’ and ‘under 50 employee’ reports.”

Candee also explained how many total reports an employer will now need to supply.

“Employers will now need three reports, but they will only need to complete two of them – the ‘establishment report’ and the ‘headquarters report.’ The EEOC is saying its EEO-1 portal software will automatically generate the needed ‘consolidated report’ from the data the employer certifies for its ‘establishment reports’ and its ‘headquarters report. ’BUT EEO-1 filers would be wise to review each field in the consolidated report, once it generates, to ensure that the consolidated report is correct and the data was accurately pulled from the data the employer certified in its two other reports.”

Wednesday, September 6, 2023: U.S. Senate Narrowly Confirmed Wilcox for Second NLRB Term

Nomination to Fill Remaining Republican Board Slot Expected Soon

Official seals for the United States Senate and the National Labor Relations Board (NLRB)The U.S. Senate confirmed Gwynne A. Wilcox for a second National Labor Relations Board (“NLRB”) term, expiring on August 27, 2028. The vote was 51-48, with Senator Cory Booker (D-NJ) not voting. Senator Joe Manchin (WV) was the only Democrat to vote against. Both Alaska Republican Senators Lisa Murkowski and Dan Sullivan voted in favor.

Earlier in the day, the Senate voted 50-49 to invoke cloture and bring the debate on the nomination to a close. That voting process took an hour and twenty minutes to complete. Senator Murkowski voted in favor and Senator Manchin voted against. Senator Sullivan voted against the motion to close the debate, but ultimately voted in favor of the nomination itself. Senator Booker also did not vote on this procedural matter.

What’s Behind the Republican Votes to Confirm?

The NLRB is a five-member, bi-partisan board, with three seats for the party currently in the White House, and two for the opposition party. The President appoints Board Members to five-year terms, with Senate consent, with the term of one Member expiring each year.

With Wilcox’s new confirmation, the Board’s membership will now consist of three Democrats – Board Chairman Lauren M. McFerran (whose current term expires on December 16, 2024), Member David M. Prouty (whose term expires on August 2026), and Member Wilcox.

Currently, Marvin E. Kaplan (whose term expires on August 27, 2025) is the sole Republican Member on the Board. Although Republican former Member John F. Ring’s tenure on the Board expired on Friday, December 16, 2022, President Biden has not yet nominated anyone to replace Ring in that Republican spot.

On Thursday, Senator Murkowski told Bloomberg that the White House assured her that a candidate to fill the Republican slot has been sent to the White House. Senator Murkowski also told Bloomberg that “she was assured by Senate Majority Leader Chuck Schumer (D-N.Y.) that the nominee, once officially nominated by President Joe Biden, will see their day on the chamber floor.”

“It was confirmed to me yesterday that a name has been sent up, the President is basically doing the vetting that needs to happen with that and I’ve been given assurances that the Republican pair [as in paired to the nomination of Democrat Wilcox] will have an opportunity to advance,” Murkowski said to Bloomberg.

“What I didn’t want to have happen was to have a situation where you filled all the Democrats and you have no incentive to advance the Republicans,” she added. “I want to see the board function, but I want to make sure there’s continued pressure to get that Republican slot filled.”

Bloomberg further reported that Senator Sullivan declined to comment on the matter.

How We Got Here

Ms. Wilcox has served as a Member of the NLRB since August 4, 2021. President Biden first nominated her on May 27, 2021, for a portion of an unexpired term on the Board. The Senate confirmed her quickly on July 28, 2021. Because Ms. Wilcox stepped in to complete the existing term of former NLRB Member Mark Gaston Pearce (vacated in 2018), her first term was not a full five-year term but instead expired in only two years, on August 27, 2023.

In June, President Joe Biden nominated Wilcox for a second NLRB term. The Senate Committee on Health, Education, Labor, and Pensions advanced the nomination on July 12.

Friday, September 8, 2023: 1,000 Compliance Evaluations Slated in Second FY 2023 Corporate Scheduling Announcement List

List Focused on Low-Wage Industries & Infrastructure Contracts

OFCCP Also Casually Announced (via FAQ) a Change Upsetting a 50-Year-old OFCCP Rule, Policy and Practice

logo for the Office of Federal Contract Compliance Programs (OFCCP)With OFCCP’s latest, controversial revisions to its audit Scheduling Letter and Itemized Listing in place as of August 24, the agency published its second FY 2023 Corporate Scheduling Announcement List (“CSAL”) for Supply & Service (“S&S”) contractors on its Scheduling List Resources webpage. (See our stories here and here for details on the changes to the Scheduling Letter and Itemized Listing). In contrast to the audit Scheduling Letter, the CSAL is a courtesy advance notification to an establishment selected for audit.

OFCCP also announced the publication of the new CSAL via an email to stakeholders. The agency published its first FY 2023 CSAL for S&S contractors in January (see our story here). If a contractor believes it should not have been selected for evaluation, the contractor must send an email to the OFCCP Scheduling Mailbox at ofccp-dpo-scheduling@dol.gov.

We estimate that this CSAL will supply enough Supply & Service audit targets at OFCCP’s current level of staffing to carry OFCCP through for about 12 months to about the beginning of FY 2025 (beginning October 1, 2024). We wrote about OFCCP’s January first CSAL Release for 500 S&S contractors in 2023 estimating that OFCCP’s then CSAL would carry it through to about the beginning of OFCCP’s new Fiscal Year (beginning in about three weeks on October 1, 2023).

OFCCP was thus successful this year in wrenching its CSAL list for S&S contractors to coincide, approximately, with OFCCP’s Fiscal Year. Fiscal Year coincidence with OFCCP’s publication of its coming audit list had been the tradition soon after OFCCP first began publication of its CSALs in the second-term Bush (the son) OFCCP Administration under OFCCP Director Charles James.

Latest Audit Selection Methodology Focused on Low-Wage Industries & Non-Construction Contractors with the Most Bipartisan Infrastructure Bill Contracts

As it has done for various CSALs going back to November 2019, OFCCP published a corresponding methodology explaining how it developed this latest CSAL. This latest, two-page methodology notes that the new CSAL contains 1,000 compliance evaluations for federal contractors and subcontractors covering establishment-based reviews, Corporate Management Compliance Evaluation (“CMCE”) reviews, and Functional Affirmative Action Program (“FAAP”) reviews. Establishment-based reviews for this list include reviews for financial institutions, universities, and colleges.

In its first FY 2023 S&S CSAL (published January 20, 2023), OFCCP targeted contractors the agency believed were required to maintain Affirmative Action Programs (“AAPs”) but that did not complete their assertedly “mandatory” annual certification in the OFCCP Contractor Portal as of December 1, 2022. For its methodology statement as to this second FY 2023 S&S CSAL published Friday, OFCCP makes no mention of the Portal or selecting for audit those contractors OFCCP believes should have certified their AAPs in the agency’s Portal but did not.

Instead, OFCCP reported that it selected covered federal Government contractors and subcontractors engaged in low-wage industries.

Editorial Note: This will position OFCCP to take it back to its “glory days” of “failure-to-hire” cases for entry-level production laborers and farther away from compensation claims made in audits. Failure-to-hire cases have historically been OFCCP’s “meat and potatoes” work generating the “lion’s share” of its back pay collections.

The agency also identified non-construction industries that received the highest frequency of contracts awarded through the bipartisan Infrastructure Investment and Jobs Act. OFCCP further refined the pool by retaining in the pool for potential selection for audit those contractor and subcontractor establishments with the highest employee headcount located within the span of control of each OFCCP District Office, based on employee counts in contractors’ 2021 EEO‐1 filings.

For each parent company with at least one contract of $50,000 anywhere in the organization, OFCCP included all establishments that meet the scheduling list’s criteria in the eligible pool of contractors. The agency created its pool of eligible financial institutions by downloading FDIC-insured banks, addresses, and employee counts from the FDIC online data tools. NOTE: Legal controversy continues to exist as to whether OFCCP has jurisdiction over banks and financial institutions as “covered” federal “Government” contractors by virtue of FDIC and related federal government insurances of deposit accounts which most believe are “Federal Financial Assistance” and not “Government contracts” Although rare, “direct deposit” of federal funds into banking institutions is the only other federal “contract” giving rise to OFCCP jurisdiction over banks. (The U.S. Department of the Treasury ceased selling savings bonds and notes on January 1, 2012 “over the counter” at banks and credit unions. The Department of the Treasury has for the over the past decade sold savings bond and notes only via online sales transactions the Department manages.)

Then, OFCCP cross-referenced all eligible establishments and functional units with the agency’s compliance management system to remove those establishments from the pool that were: (1) currently under review; (2) currently in a monitoring period pursuant to a conciliation agreement; (3) currently within the exemption period following a closed review; (4) currently pending scheduling for review from a prior scheduling list; or (5) have an active separate facilities waiver.

To finalize the selections, OFCCP used the following criteria to select:

  1. five CMCE reviews per region with the highest employee count in a district office. So, six OFCCP Regions x five CMCEs per Region = 30 CMCEs nationwide;
  2. establishments with the highest employee count within the span of control of an OFCCP District Office for establishment reviews, but OFCCP did not include more than two establishments on its CSAL of any parent company;
  3. six FAAP Establishments per OFCCP Region (so 36 FAAP Establishment audits nationwide) selected from among those FAAPS that had the highest employee counts between 200 and 400 within the span of control of the OFCCP District Offices responsible to undertake the audits, but did not select more than three FAAP Establishments of any parent company;
  4. two financial institutions per OFCCP Region (2 x 6 =12 financial institution OFCCP audits nationwide) with the highest employee counts in each Region; and
  5. two colleges/universities per OFCCP Region (2 x 6 = 12 college/university audits nationwide) with the highest employee counts in each OFCCP Region.

Editorial Note: These 12 audits will “sink OFCCP’s boat” because they will likely be the 12 largest audits OFCCP will start (not complete) in the next 12 months.

Revamped CSAL FAQ Section Purports to Overrule OFCCP’s Rules and 50+ Years of OFCCP Policy and Practice

Also on Friday, OFCCP made extensive updates to its Frequently Asked Questions (FAQs) section covering CSALs. The last time OFCCP revised this FAQ section was on June 5, 2023, when it published a CSAL identifying 250 “Construction Contractors” for audit (see our story on that CSAL here). Important highlights of Friday’s FAQ revisions include:

OFCCP formally recognized that the agency is changing its half-century-long position on the compliance obligations of companies with both S&S and Construction contracts by auditing “contracts,” not contractor type. (See new FAQ #1.) Accordingly, a Supply and Service contractor with a Supply & Service contract that is also signatory to a covered federal Government Construction contract could be subject to an audit of its Supply & Service contract and separately of its construction contract, in OFCCP’s new view. Here is what OFCCP has now written:

“1. My company traditionally performs work under non-construction, or supply & service contracts. If my company also performs work under a construction contract, and my company is scheduled for a review under said construction contract, will OFCCP administratively close the construction compliance review?

No. OFCCP will no longer (emphases added) administratively close the construction compliance reviews in this instance.

Contractors and subcontractors with a covered construction contract are required to fulfill all applicable obligations under 41 CFR part 60-4 as to its workers that are engaged in on-site construction work and functions incidental to the actual construction (e.g., supervision or inspection of construction work), and including those construction employees who work on a non-Federal or non-federally assisted construction site. Thus, a company that holds a covered non-construction (supply and service) contract and a covered construction contract may be scheduled and reviewed by OFCCP under 41 CFR part 60-2 or 41 CFR part 60-4, depending on the establishment or worksite that is scheduled.”

Editorial Note: OFCCP’s new “podium policy” is quite different from the way in which OFCCP’s Rules are written at 41 CFR Section 60-2.1 and at 60-4, even though there has been no OFCCP proposal to change its Rules, let alone to publish a legally effective Final Rule. OFCCP’s forced transition away from the clear language of OFCCP’s Rules and OFCCP’s longstanding (51-year) policy and practice to audit “contractors” (not “contracts signed”) violates the Administrative Procedure Act (“APA”) and is unenforceable once properly resisted and OFCCP seeks to enforce its casually accomplished policy change in the courts.

What OFCCP’s newly announced “podium policy” means to any Supply and Service Contractors that choose to comply with it is that the company would have to carve out of its Affirmative Action Programs and supporting analyses, and from OFCCP’s Supply & Service audits, all its employees who work on or under the company’s federal government construction contract or subcontract. And, the “hybrid” federal contractor signatory to both construction and Supply & Service covered federal Government contracts that chooses to submit to OFCCP’s pressure to comply will also have to comply with OFCCP’s construction contractor affirmative action policies and compliance requirements set out in 41 CFR Section 60-4 (including, notably, the “16 Affirmative Action Steps” for federal construction contractors). And, vice versa for construction contractors that also sign Supply & Service contracts.

And, of course, absent formal Rulemaking, neither the contractor nor OFCCP will know how to treat “hybrid” support personnel, like the CEO, CFO, CHRO, General Counsel, etc., who support both of the company’s federal Supply & Service and Construction contracts. Unless a contractor that is signatory to both Supply & Service and Construction contracts resists audit and forces OFCCP to sue it to enforce this new questionable practice as a departure from OFCCP’s Rules (and thus violative of the APA), OFCCP’s forced “hybrid audits” of “hybrid contractors” are going to be very confused affairs.

  • The agency eliminated, formally, references to “Focused Reviews” and “Compliance Checks” (which the Biden OFCCP ceased undertaking at the beginning of this Administration); and
  • The audit limit per company is now three, not four. (See new FAQ #8).

In Brief

Friday, September 8, 2023: U.S. DOL’s WHD Officially Published Overtime Rule Proposal

Comments Due by November 7

Official Logo for the US Department of Labor's Wage and Hour DivisionThe U.S. Department of Labor’s Wage and Hour Division (“WHD”) officially published its previously announced  Notice of Proposed Rulemaking (“NPRM”) to revise its regulations under Section 13(a)(1) of the Fair Labor Standards Act (“FLSA”). Section 13(a) implements the exemptions from minimum wage and overtime pay requirements for “executive,” “administrative,” and “professional” (“EAP”) employees. The proposed revisions include increasing the standard salary level necessary for exemption from the current $35,568 to $55,068 annually and the highly compensated employee (“HCE”) total annual compensation threshold from the current $107,432 level to $143,988. The proposal would also provide an automatic updating (indexing) mechanism to allow for the timely and efficient updating of all the thresholds to reflect the current earnings data.

We reported on this NPRM in detail following the WHD announcement of it on August 30. The WHD’s Federal Register notice also contains links to five supporting documents. Comments are due on or before November 7, 2023, and you may submit them here or here.

Friday, September 8, 2023: Second, & Last, Chance to Comment on EEOC’s Request to Extend ADEA/OWBPA ICR w/o Change

Official Seal of the EEOC featuring Bald Eagle and bannerEmployers have a second opportunity to comment on the U.S. Equal Employment Opportunity Commission’s (“EEOC”) request for the White House Office of Management and Budget (“OMB”) to extend – without change – its approval of the EEOC’s Age Discrimination in Employment Act of 1967 (“ADEA”) waiver third-party disclosure requirements. The Older Workers Benefit Protection Act (“OWBPA”) enacted in 1990, amended the ADEA to require employers to disclose certain information to employees (but not to the EEOC) in writing when they ask employees to waive their rights under the ADEA in connection with an exit incentive program or other employment termination program. Those requirements are contained in the agency’s regulation at 29 CFR 1625.22.

On Friday, the EEOC published a Federal Register notice of a 30-day comment period on this proposal that references its earlier June 12, 2023, more detailed 60-day notice of the proposal. The 60-day comment period closed on August 11, 2023; the EEOC reported that it did not receive any comments on the 60-day notice. The deadline for comments on the 30-day notice is October 10, 2023. You may submit comments here or here.

The current OMB approval for this “information collection requirement” (“ICR”) expires on September 30, 2023. The OMB grants a month-to-month extension of existing ICRs while they undergo review.

Looking Ahead - Upcoming Reminders

Looking Ahead:
Upcoming Date Reminders

We have added four NEW items to this week’s calendar, below:

June 2023: U.S. DOL WHD’s current target date (now overdue) to publish its Final Rule on Nondisplacement of Qualified Workers Under Service Contracts (RIN: 1235-AA42)

June 2023: U.S. OSHA’s current target date (now overdue) to publish its Final Rule on Occupational Exposure to COVID-19 in Healthcare Settings (RIN: 1218-AD36)

August 2023: U.S. DOL WHD’s (now overdue) target date for its Final Rule on Employee or Independent Contractor Classification Under the Fair Labor Standards Act (RIN: 1235-AA43)

August 2023: U.S. NLRB’s (now overdue) target date for its Final Rule on Standard for Determining Joint-Employer Status (under the NLRA) (RIN: 3142-AA21)

August 2023: U.S. NLRB’s (now overdue) target date for its Final Election Protection Rule (RIN: 3142-AA22

August 2023: U.S. DOL’s OASAM’s (now overdue) target date to publish Proposed Rule on “Revision of the Regulations Implementing Section 188 of the Workforce Innovation and Opportunity Act (WIOA) to Clarify Nondiscrimination and Equal Opportunity Requirements and Obligations Related to Sex” (RIN: 1291-AA44

September 13, 2023 (2:00 – 3:30 PM ET): DE webinar on “What Federal Contractors Need to Know About OFCCP’s New Audit Scheduling Letter 

September 19, 2023: Comments due on the Office of Personnel Management’s Proposed Rule – “Recruitment and Selection Through Competitive Examination, and Employment in the Excepted Service (Rule of Many)

September 30, 2023: 2023 VETS-4212 filing deadline – the reporting cycle began on Tuesday, August 1, 2022

October 2, 2023: Deadline for comments on DHS/ICE’s proposed pilot procedure program & information collection for non-E-Verify participants as to remote I-9 Form document inspections

October 10, 2023: Comments due on EEOC’s Proposed Regulations to Implement the Pregnant Workers Fairness Act

 NEW  October 10, 2023: Comments due on the EEOC’s proposal to extend – without change – its ADEA/OWBPA third-party waiver & disclosure requirements 

October 23, 2023: US DOL’s WHD Final Rule updating Davis-Bacon & Related Acts regulations takes effect

October 30, 2023: Deadline for comments on OSHA’s union-friendly proposal to revise its Worker Walkaround Representative Designation Process

 NEW  October 31, 2023: Opening Date for EEO-1 Survey Component 1 Data Collection

 NEW  November 7, 2023: Comments due on U.S. DOL WHD’s proposal to revise its FLSA regulations on the exemptions from minimum wage and overtime pay requirements for executive, administrative, & professional employees

 NEW  December 5, 2023: Deadline for EEO-1 Survey Component 1 Data Collection

December 26, 2023: NLRB’s Direct Final Rule revising its procedures governing representation elections takes effect

December 29, 2023: Statutory deadline for EEOC regulations to enforce the Pregnant Workers Fairness Act 

December 2023: OFCCP’s current target date for its Notice of Proposed Rulemaking to “Modernize” Supply & Service Contractor Regulations (RIN: 1250-AA13)

December 2023: OFCCP’s current target date for its Final Rule on “Technical Amendments” to Update Jurisdictional Thresholds & Remove Gender Assumptive Pronouns (RIN: 1250-AA16)

January 1, 2024: U.S. DOL OSHA’s Final Rule Requiring Covered High-Hazard Industry Employers to Electronically Submit Injury & Illness Records Takes Effect

April 3 – April 5, 2024: DEAMcon24 New Orleans 

Register for DEAMcon24

June 2024: OFCCP’s current target date for its Notice of Proposed Rulemaking to Require Reporting of Subcontractors (RIN: 1250-AA15)

THIS COLUMN IS MEANT TO ASSIST IN A GENERAL UNDERSTANDING OF THE CURRENT LAW AND PRACTICE RELATING TO OFCCP. IT IS NOT TO BE REGARDED AS LEGAL ADVICE. COMPANIES OR INDIVIDUALS WITH PARTICULAR QUESTIONS SHOULD SEEK ADVICE OF COUNSEL.

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John C. Fox
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