OFCCP Week In Review: October 23, 2023

The 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:

• New US DOL Administrative Review Board Decision from March Sets Down New Backpay Calculation Runway in Litigated OFCCP Cases
• GAO Official Testified That Programs to Help Military-to-Civilian Life Transitions Need Improvements
• $1 Million Settlement Reached on US EEOC Allegations That Dollar General’s Hiring Process Violated GINA & ADA
• OFCCP’s FY 2023 Back Pay Collections Now Stop its Four-Year Downward Spiral by Exceeding its FY 2022 Collections
• Karla Gilbride Sworn In as U.S. EEOC General Counsel
• In Brief
• Looking Ahead: Upcoming Date Reminders

Monday, October 16, 2023: New US DOL Administrative Review Board Decision from March Sets Down New Backpay Calculation Runway in Litigated OFCCP Cases

Former Labor Secretary Walsh Reversed Previous ARB/ALJ Rulings Last Year

The U.S. Department of Labor’s (“DOL”) Administrative Review Board (“ARB”) issued an order modifying its earlier decision regarding damages and other remedies in an OFCCP administrative action – OFCCP v. WMS Solutions, LLC, ARB Case No. 2020-0057, ALJ Case No. 2015-OFC-00009. While the new decision is dated March 8, 2023, it was not posted on the Department of Labor’s (“DOL”) Office of Administrative Law Judges (“OALJ”) website until this past week. The case is notable because, late last year, then Labor Secretary Marty Walsh, for a second time, exercised the authority – granted to the Secretary of Labor through Trump Secretary of Labor Eugene Scalia’s Order 01-2020 – to intervene in an OFCCP administrative lawsuit as a court of last administrative resort within USDOL.

On December 23, 2022, then Secretary Walsh issued a Final Agency Decision reversing in part an earlier decision by the ARB. The ARB decision had affirmed an ALJ’s decision that had imposed remedies for alleged unlawful hiring and compensation discrimination. Finding that the ALJ “abused his discretion” in ruling on several issues regarding damages and other remedies, the Secretary remanded those portions of the case back to the ARB. For further details on that decision, see our story here.

In the newly posted, 14-page March 8, 2023, “Order on Remand from the Secretary of Labor,” the ARB modified the back pay and interest awards and ordered job relief consistent with the former Secretary’s Final Agency Decision. That Order now requires backpay to be calculated up to and through the date of the trial judge’s (Administrative Law Judge’s, or “ALJ’s”) decision. Prior to Secretary Walsh’s unusual intervention in the WMS case, ALJs had routinely ordered backpay calculated to and through a set date in advance of the trial (technically called a “Hearing”).

This “set date” practice had allowed Expert Witnesses for each side to then testify at trial and inform the Court of their opinions as to what the damages were and what amount of interest had accrued on those damages to and through the date in advance of trial the Court had set. And since ALJs routinely now take over a year after trial to render their written Judgments in OALJ OFCCP cases alleging unlawful discrimination, Secretary Walsh’s concern was that the beneficiary of a backpay Judgment was suffering the loss of the use of the backpay monies while awaiting the ALJ’s judgment in cases in which OFCCP prevailed by proving unlawful discrimination had occurred. The ALJ’s judgment is known technically as a “Recommended Decision and Order” and concludes the Hearing.

Going forward, Expert Witnesses testifying about backpay damages in an OFCCP discrimination case will have to provide the Court with daily interest rate accumulation projections over the period of time the Court might require to render its Recommended Decision and Order should the ALJ find unlawful discrimination occurred. Otherwise, the ALJ would have to reconvene a second Hearing just to hear Expert Testimony to true up the accrual of interest for the interval of time since the date of the testimonies of the Expert Witnesses at the original Hearing which led up to the ALJ’s Recommended Decision and Order.

Wednesday, October 18, 2023: GAO Official Testified That Programs to Help Military-to-Civilian Life Transitions Need Improvements

The U.S. Government Accountability Office (“GAO”) made numerous recommendations to the Departments of Defense (“DOD”) and Veterans Affairs (“VA”) designed to enhance their programs for the around 200,000 service members each year who transition from military to civilian life, John D. Sawyer, the GAO’s Director of Education, Workforce, and Income Security, testified before two Senate Committees. These programs include employment-related services. Director Sawyer was among the first panel of witnesses in a joint, almost three-and-a-half-hour hearing of the Senate’s Armed Services and Veterans’ Affairs Committees.

Since February 2022, the GAO has made ten recommendations (nine to DOD and one to VA) related to these military transition programs (See Appendix 1 (starting on page 13) of the Testimony Report. DOD concurred with the recommendations and identified planned steps and time frames for their implementation. VA implemented the GAO’s recommendation to it.

Highlights of those recommendations include:

• DOD has two programs to help service members get civilian credentials for their military training, but it does not have sufficient evidence to show that the programs work. Service members have the opportunity to obtain civilian credentials related to their military training and skills before they leave the military, which they can use to obtain civilian jobs. In February 2022, the GAO found that DOD had not fully assessed the effectiveness of these programs. One of the recommendations for the DOD was to undertake such an assessment.
• Service members preparing to leave the military generally must participate in the Transition Assistance Program (“TAP”). Although DOD service branches have implemented elements of TAP, in July 2021, the GAO found that selected small or remote installations had implementation challenges. Moreover, the GAO’s December 2022 analysis of TAP data from April 1, 2021 to March 31, 2022, showed that nearly a quarter of service members who were required to attend a 2-day TAP class did not do so. The GAO also found that most service members (70 percent) did not start TAP more than one year in advance, as generally required. Additionally, DOD and its service branches were not using available performance data to understand the root causes of poor participation and take appropriate corrective action.
• The Solid Start program provides tailored information about resources and benefits to support veterans during their first year after leaving the military. In January 2023, the GAO found that VA representatives successfully contacted about 71 percent of eligible veterans in 2021, and these veterans used VA benefits to a greater extent than those who did not speak with a representative. However, the GAO found that VA had not collaborated with veterans’ organizations to help connect with hard-to-reach veterans. As a result, the GAO recommended greater collaboration with these organizations.

Thursday, October 19, 2023: $1 Million Settlement Reached on US EEOC Allegations That Dollar General’s Hiring Process Violated GINA & ADA

Agency Alleged Retailer Required Disclosure of Family Member’s Medical Conditions During Pre-Employment Medical Exam

EEOC Also Alleged Employer Used Criteria that Screened Out Qualified Applicants with Disabilities

A $1 million settlement between the U.S. Equal Employment Opportunity Commission (“EEOC”) and the retailer doing business as Dollar General provides another cautionary tale for employers to be mindful of the scope of mandatory pre-employment medical exams and relevant job qualification criteria. Variety store retailer Dolgencorp, LLC agreed to the monetary settlement and other relief to settle the EEOC’s claims that the retailer’s hiring process for distribution center workers violated the Genetic Information Nondiscrimination Act (“GINA”) and the Americans with Disabilities Act (“ADA”). This settlement resolves claims in a lawsuit that the EEOC filed in 2017 (EEOC v. Dolgencorp, LLC., Case No. 2:17-cv-01649-MHH) in the U.S. District Court for the Northern District of Alabama. Dollar General discontinued its practice of requiring pre-employment medical exams for these warehouse jobs after the lawsuit was filed, the Commission reported in its press release announcing the settlement.

GINA Allegations Centered on Solicitation of Family Medical Histories

According to the EEOC, after the retailer made job offers to work at its Bessemer, Alabama Distribution Center, it required those 498 applicants to pass a pre-employment medical exam which required them to divulge past and present medical conditions of family members such as cancer, diabetes, and heart disease. GINA defines “genetic information” to include the manifestation of a disease or disorder in an employee’s/applicant’s family members. GINA prohibits employers from requesting, requiring, or purchasing genetic information, including about applicants or employees and their family members, except in very narrow circumstances.

“Requiring individuals during the hiring process to answer invasive questions about medical conditions of their grandparents, parents or children violates GINA,” said EEOC Birmingham District Director Bradley Anderson in the press statement. “An employer is prohibited from soliciting this information, regardless of whether the information is used to deny employment.”

ADA Allegations Centered on Job Qualification Criteria

The Commission also alleged that the retailer used qualification criteria that screened out qualified individuals with disabilities. For instance, the employer rescinded job offers to applicants whose blood pressure exceeded 160/100 or who had less than 20/50 vision in one eye, even when those impairments did not prevent the applicants from safely performing the job, the EEOC claimed.

“The ADA protects job applicants from being denied employment because of a disability as long as they can perform the job with or without an accommodation. Employers cannot deny employment solely based on stereotypes about the abilities of individuals with certain impairments,” said Regional Attorney for the EEOC’s Birmingham District Marsha Rucker in the press release.

Other Agreed Upon Remedies

The 27-month consent decree settling the suit also requires the employer to review and revise its ADA and GINA policies and distribute them to all individuals involved in the hiring process should they resume requiring medical exams. In addition, the employer must (1) require their medical examiners not to request family medical history; (2) consider the medical opinion of an applicant’s personal physician; and (3) inform applicants how to request a reasonable accommodation if needed. Under the agreement, the retailer will also provide annual training to all individuals involved in the hiring process on the ADA and GINA and post a notice to employees on their rights under these statutes and how to file a charge of discrimination with the EEOC.

Friday, October 20, 2023: OFCCP’s FY 2023 Back Pay Collections Now Stop its Four-Year Downward Spiral by Exceeding its FY 2022 Collections

Following a flurry of 10 FY 2023 discrimination law settlements OFCCP belatedly published only last week (week of October 18^th), and all signed in the last three days of FY 2023 with 6 of them on the very last working day of the Fiscal Year, OFCCP pushed up its total back pay collections for FY 2023 (thus far) to $13,815, 464.18. This is up from the $9,779,529.79 OFCCP had publicly reported through October 15, 2023 as we wrote about here. FY 2023 ended Saturday September 30, 2023.

The volume of last-minute end-of-Fiscal Year settlements, their late reporting to the public, and their higher monetary value also set new records for OFCCP. While we are not sure the agency is finished yet with late reports of discrimination law settlements  (since it has now trickled out over 15 of them two to three weeks after Fiscal Year 2023 ended), OFCCP has thus far reported 35 Conciliation Agreements for FY 2023 settling discrimination claims it made against covered federal Government contractors, 13 of them (37%) occurred in the fourth Quarter of FY 2023. Moreover, those 4^th Quarter settlements were worth $9,868,294.18 or 71% of OFCCP’s (thus far) total back pay collections in FY 2023.

NOTE: Prior OFCCP Administrations had tried to curb OFCCP’s historic habit of a swelled end-of-year settlement push by seeking to level settlements more evenly throughout each quarter of the Fiscal Year. OFCCP has now clearly reverted, however, to its prior “run fast at the end of the race” settlement strategy as we reported last week and a year ago. OFCCP’s end of year settlement push this past Fiscal Year was simply later and larger than that of previous years.

OFCCP’s enforcement production to date for FY 2023 of over $13 million has now increased its FY 2022 production (of $11,763,447) by 17%. The FY 2023 back pay collection uptick, however, is still only about half of OFCCP’s $26 million plus back pay collection in FY 2021 and almost two thirds less than the $35 million plus in the last year of the Trump Administration.

And, of course, this year’s increase in back pay collections to $13 million pales by comparison to OFCCP’s record $40 million plus the agency raked in during the penultimate year (FY 2019) before the Trump Administration left office (as we reported then and summarized in our Week In Review story last Monday October 16, 2023 and hyperlinked, above). So, OFCCP’s FY 2023 back pay collections was a nice (and needed) rebound, but with a l-o-n-g way back to its “glory days” only a few short years ago.

We will continue to follow the saga of OFCCP’s FY 2023 back pay collections to determine if the agency is now done, or whether the spigot is still trickling discrimination law settlements out every few days like a short order cook serving up diner food.

Monday, October 23, 2023: Karla Gilbride Sworn In as U.S. EEOC General Counsel

Senate Voted to Confirm Nomination on Tuesday

Republican Senator Collins Gave Gilbride Her 50th “Yea” Vote

U.S. Equal Employment Opportunity Commission (“EEOC”) Chair EEOC Chair Charlotte A. Burrows swore in Karla Ann Gilbride as General Counsel (“GC”) of the EEOC. Ms. Gilbride left her jobs as Of Counsel to Sanford Heisler Sharp, LLP, and as Of Counsel to the Civil Rights Education and Enforcement Center to take the EEOC GC position. That job had been vacant for over two and a half years. Gilbride, who is blind, is the first person with a known disability to be appointed to the role of general counsel at the EEOC, the Commission noted in a press release.

On Tuesday, with insufficient Democrat support to get her confirmed, Senator Susan Collins (R-ME) broke political party ranks and cast her vote “Yea” in favor of Gilbride’s confirmation to be the next General Counsel (“GC”) of  the U.S. Equal Employment Opportunity Commission (“EEOC”).  Collins’ vote gave Gilbride a 50-46 win which otherwise formed up along party-lines. Collins was the sole Republican voting in favor of Gilbride’s nomination, but without Collins, Gilbride’s nomination would have failed. All of the Senators who voted against the nomination were Republicans. Two Republicans – Rand Paul (KY) and Tim Scott (SC) – and two Democrats –newly appointed Laphonza Romanique Butler (CA) (replacing Senator Diane Feinstein who recently died in office) and Richard Durbin (IL) – did not vote.

Earlier the same day, the Senate voted 50-47 to bring any debate on the nomination to a close. Senator Collins was also the sole Republican vote then. Democratic Senators Butler and Durbin and Republican Senator Paul did not vote.

How We Got Here

In June 2022, the President first nominated Ms. Gilbride for the EEOC GC position (more details on her background are in our story here). The Senate failed to approve her nominations in the previous (117th) Congress which adjourned on January 3rd of this year as the 118th Congress was seated. Nonetheless, President Biden re-nominated her in January. In February, the Senate Committee on Health, Education, Labor, and Pensions (“HELP”) Committee reported favorably on Gilbride’s nomination (our story is here).

When President Biden first announced his nomination of Ms. Gilbride in June 2022, it was almost 15 months after he fired President Trump’s pick for EEOC General Counsel, Sharon Gustafson. President Biden fired Gustafson in March of 2021 after she refused to resign upon the change in administrations.

Friday, October 20, 2023: Senate HELP Committee Scheduled Hearing on Nomination of Current EEOC Chair Burrows for 3rd Commissioner Term

On Wednesday, October 25, the U.S. Senate Committee on Health, Education, Labor, and Pensions (“HELP”) Committee plans to hold a hearing on President Biden’s nomination of Charlotte A. Burrows for a third term on the bipartisan U.S. Equal Employment Opportunity Commission (“EEOC”). Burrows, currently the Commission Chair, was initially nominated to serve as a Commissioner in 2014 (by President Obama) and then re-nominated in 2019 (by President Trump). The HELP Committee will also consider three other pending nominations for positions with other agencies.

President Biden nominated Commissioner Burrows for a third term in June of this year. (See our story here). If confirmed, Ms. Burrows’ third term would expire on July 1, 2028. Her second term technically expired on July 1, 2023. However, under Commission Rules, sitting Commissioners may remain in office until the end of the calendar year in which their term of office terms out, if the U.S. Senate does not previously confirm the President’s Nominee to replace a departing Commissioner.

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.