OFCCP Week In Review: February 26, 2024

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:

• Telecommuting Decreased in 2022, But Still Far Above Pre-Pandemic Numbers, U.S. Census Bureau Reported
• Overturning ALJ, U.S. NLRB Ruled Employee’s Display of Black Lives Matter/BLM on Work Apron Was Protected Activity
• U.S. Trial Court Judge Pushed Back NLRB Joint Employer Rule Effective Date to March 11
• OFCCP Rolled Out Its Entirely Revamped Construction Contractor Audit Selection Protocols and Audit Schemes
• OFCCP Has Formally Proposed to Resurrect Monthly CC-257 Employment Utilization Reports for Construction Contractors to Give OFCCP a New Way to Select Construction Contractors for Audit
• GAMECHANGER: OFCCP Proposed Changes to Construction Compliance Review Scheduling Letter, Itemized Listing, and Construction Contract Award Notification Requirement Form
• In Brief
• Looking Ahead: Upcoming Date Reminders

Tuesday, February 20, 2024: Telecommuting Decreased in 2022, But Still Far Above Pre-Pandemic Numbers, U.S. Census Bureau Reported

Over 20 Million People Worked from Home in 2022

Public Transit Commuting Has Not Fully Rebounded

Among U.S. workers, 15.2 percent worked from home in 2022, down from almost 17.9 percent in 2021, but still far higher than the 5.7 percent that worked from home before the onset of the COVID-19 pandemic in 2019, the U.S. Census Bureau announced, citing its new brief on Commuting in the United States: 2022. The brief highlights the latest available statistics on commuting behavior in the United States and Puerto Rico from the 2022 American Community Survey (“ACS”). It explores recent commuting trends using estimates from the 2022 ACS, 1-year dataset, with comparisons to 2019 and 2021 (See our story here for details on the Bureau’s commuting report for the period between 2019 and 2021). The new brief analysis shows changes in the way people travel to on-site work since the onset of the COVID-19 pandemic along with several key commuting characteristics, including means of transportation to on-site work, travel time to on-site work, and time of departure from home to go to a workplace.

The Bureau cited additional highlights, including:

• Almost 140 million people in the United States routinely commuted to on-site work in 2022, and more than 20 million worked from home.
• Among workers in Puerto Rico, 5.9 percent worked from home in 2022, down from 7.4 percent in 2021 but more than twice the 2019 share of 2.4 percent.
• The share of U.S. workers driving alone to on-site work was 68.7 percent in 2022, about seven percentage points less than the 75.9 percent in 2019. In Puerto Rico, 82.7 percent of workers drove alone to their place of work in 2022, compared to 84.3 percent in 2019, a decline of less than 2 percentage points.
• Public transportation commuting in the United States remained well below the 2019 share of 5.0 percent of workers at 3.1 percent in 2022. This represented an increase from the 2.5 percent of workers commuting by public transportation in 2021. In Puerto Rico, less than 1 percent of workers commuted by public transportation in 2021 and 2022, compared to 1.2 percent in 2019.
• In each of seven U.S. metropolitan areas with the most public transportation commuters, more workers commuted by public transportation in 2022 compared to 2021. However, public transportation commuting did not rebound to 2019 levels in any of these seven metro areas. In the New York metro, there were roughly 700,000 fewer transit commuters in 2022 than in 2019.
• Average one-way commuting time among those who traveled to a workplace increased by almost 1 minute from 25.6 minutes in 2021 to 26.4 minutes in 2022, still well short of its historic high of 27.6 minutes in 2019.
• With more than 20 million people working from home in 2022, about nine million fewer commuters departed their homes for the workplace during the core commuting hours of 6 a.m. to 8:59 a.m. in 2022 than in 2019.

Wednesday, February 21, 2024: Overturning ALJ, U.S. NLRB Ruled Employee’s Display of Black Lives Matter/BLM on Work Apron Was Protected Activity

A customer-facing retail employee’s display of “BLM” – the acronym for “Black Lives Matter” – on their work apron was an activity protected by Section 7 of the National Labor Relations Act (“NLRA”), the National Labor Relations Board (“NLRB”) ruled 3-1. (Sidenote: the employee’s pronouns are “their” and “them.”) Accordingly, Home Depot violated Section 8(a)(1) of the NLRA when it: directed the employee to remove the BLM marking; applied its dress code and apron policy to prohibit them from wearing the BLM marking, and constructively discharged them for declining to remove it, the Board majority concluded (Home Depot USA, Inc., Case 18–CA–273796). In so ruling, the NLRB reversed a June 10, 2022, decision by U.S. Department of Labor  Administrative Law Judge (“ALJ”) Paul Bogas. We discussed the facts of this case in detail in our previous story about ALJ Bogas’ decision.

The NLRA protects the legal right of employees to engage in “concerted activities” for the purpose of “mutual aid or protection” regardless of whether they are represented by a union, the Board explained in a statement on the decision. The NLRB majority reasoned that the employee’s refusal to remove the BLM marking was “concerted” because it was a “logical outgrowth” of prior concerted employee protests about racial discrimination in their workplace and because it was an attempt to bring those group complaints to the attention of Home Depot managers. The employee’s conduct was also “for mutual aid or protection” because the issue of racial discrimination involved employees’ working conditions, the majority concluded.

Board Chair Lauren McFerran, joined by Members Gwynne A. Wilcox and David M. Prouty, issued the 20-page majority ruling.

Marvin E. Kaplan, the Board’s lone Republican member, dissented in part. In an 11-page opinion, he argued that the employee’s actions did not constitute concerted activities, and even if they did, they did not do so for the purpose of mutual aid or protection.

“In a different case with different facts, it could well be that an employee who displays ‘BLM’ in the workplace is protected by the [NLRA] in doing so. On the facts of this case, however, I cannot so find,” Kaplan wrote.

Thursday, February 22, 2024: U.S. Trial Court Judge Pushed Back NLRB Joint Employer Rule Effective Date to March 11

Stay Extends Previous February 26 Effective Date by 14 Days

U.S. District Judge J. Campbell Barker of the Eastern District of Texas (in Tyler) stayed, until March 11, 2024, the effective date of the U.S. National Labor Relations Board’s (“NLRB”) finalized joint employer Rule. In November 2023, the NLRB extended the original effective date of the Final Rule by two months, from December 26, 2023, to February 26, 2024 (see our story here). Judge Barker’s order extends the February 26 effective date by another 14 days to allow the Court to decide potentially dispositive motions pending in the case.

The Final Rule established a new, broader standard to determine whether two or more employers are joint employers of particular employees within the meaning of the National Labor Relations Act. The new standard will only apply to cases filed after the Final Rule takes effect, the NLRB reiterated in a statement on Judge Barker’s order. We discussed the Final Rule, published in late October 2023, in detail here.

On November 9, 2023, the U.S. Chamber of Commerce and other business groups sued the NLRB in the U.S. District Court in the Eastern District of Texas seeking to block the Final Rule permanently (Chamber of Commerce of the United States of America, et. al v. NLRB, No. 6:23–cv–00553). On February 13, 2023, Judge Barker held a hearing on various potentially dispositive motions in the case. The temporary stay of the effective date will allow the judge time to consider those motions.

In a November 22, 2023, Federal Register Notice, the NLRB stated that it amended the original effective date “to facilitate the resolution of the legal challenges with respect to the Final Rule” (see our story here.) Specifically, it cited a November 6, 2023, petition for review of the Final Rule filed in the United States Court of Appeals for the District of Columbia Circuit (Service Employees International Union v. NLRB, No. 23–1309). It also cited the case over which Judge Barker currently presides.

Friday, February 23, 2024: OFCCP Rolled Out Its Entirely Revamped Construction Contractor Audit Selection Protocols and Audit Schemes

OFCCP Positioning Itself To Now Routinely Subject Construction Contractors To Systemic Discrimination Investigations

OFCCP came out-of-the-blue with two major game changing overhauls of its construction contractor audit selection protocols and its auditing schemes to now put systemic discrimination investigations front and center of construction contractors.

We have written two blogs today which appear immediately below to describe these two major OFCCP initiatives, obviously long in the making.

The first Blog, below, discusses OFCCP’s proposal to revitalize and expand use of a previously retired “CC-257” monthly report of hours worked on each construction worksite. OFCCP plans to use this tool to both make selections for audits , using new neutral selection criteria to be developed, and to help increase the agency’s efficiency as it often currently prepares to audit a construction contractor onsite only to discover the project is completed and the worksite is closed. The issue here for the almost 10,000 construction contractors OFCCP believes trigger its jurisdiction is the large monthly reporting  burden, which we discuss below.

The second Blog, below, discusses OFCCP’s proposal to substantially revise its audit Scheduling Letter and Itemized Listing. The action is in the Itemized Listing and raises questions both about burden on audited contractors and the vulnerability that many construction contractors will face without proper documentation of their selection rationales to defend themselves in the coming new form of OFCCP audit. Those  audits will soon focus primarily on whether unlawful hiring exists in hiring, promotions, involuntary terminations, layoffs, recalls, compensation, and the assignment of overtime. While Supply and Service contractors are now long used to these searching OFCCP systemic discrimination law investigations, this is a brand-new ball game for construction contractors.

We highly recommend you read both blogs with care, as these are major moves by OFCCP, and probably with a good glass of an aged red wine to help this all go down a little bit more smoothly. Enjoy!

Friday, February 23, 2024: OFCCP Has Formally Proposed to Resurrect Monthly CC-257 Employment Utilization Report for Construction Contractors to Give OFCCP a New Way to Select Construction Contractors for Audit

Proposed Version of Reinstated Form Would Have Multiple Changes

In a move perhaps akin to a vampire or zombie story, OFCCP is seeking public comments regarding its sudden proposal (not mentioned in its Semi-Annual Regulatory Reports) to obtain approval from the Office of Management and Budget (“OMB”) to resurrect, with changes, a so-called Monthly Employment Utilization Report (CC–257) for construction contractors. The Clinton OFCCP discontinued these reports almost 30 years ago. No other Republican or Democrat Administration since then has thought the CC-257 reports worthwhile and all thought them too expensive for construction contractors and for OFCCP itself to process. (Thousands of them used to monthly stack up in agency hallways in boxes, unread.)

Note: Please read this story in conjunction with the following story discussing OFCCP’s simultaneous requests to OMB for it to approve a new construction contractor audit Scheduling Letter and attached Itemized Listing and to continue the use, for another three years, of a Construction Contract Award Notification Form (Form CC–314). OFCCP requires covered federal Government construction contractors to complete and file the Form CC-314 with OFCCP disclosing the contractor’s covered federal Government “subcontractors.”

In a Federal Register Notice, the agency explained that “covered construction contractors previously submitted [Form CC-257] to OFCCP on a monthly basis and [it] included information on employee work hours by race/ethnicity, gender, and trade in the covered area.” You may download a copy of the previous version of the form here. OFCCP discontinued the use of Form CC-257 on December 8, 1995. Comments on the proposal are due by April 23, 2024. You may submit them here or here.

OFCCP attached links to the Proposed CC-257 Form and Proposed CC-257 Form Instructions to the electronic version of the Federal Register Notice and on Regulations.gov (search for Docket (OFCCP-2024-0001)). As of our publication deadline, OMB has not yet posted its “Abstract” (i.e., OMB’s file dashboard on this OFCCP request) for OFCCP-2024-0001.

The text of the Notice itself simply states that, under the proposed changes, construction contractors would “provide information on employee work hours and employee count by race/ethnicity, gender, and trade in the covered area.” A corresponding 17-page Supporting Statement, attached to the Notice and posted on Regulations.gov, provides more detail.

OFCCP is in a Fast Hurry to Implement this New Reporting Requirement

“OFCCP plans to implement the re-instated CC-257 report upon OMB approval. OFCCP will provide stakeholder education on the collection and inform stakeholders of the implementation dates through its stakeholder messaging or other means.”

This statement ignores that requiring a new report from contractors must undergo not only OMB review pursuant to the Paperwork Reduction Act, but also Notice and Comment pursuant to the Administrative Procedure Act detailing the proposal, supplying definitions, and inviting review as to whether the proposal is either “arbitrary and capricious” and whether there is Congressional statutory authorization for the proposed CC-257 Report.

OFCCP’s statement also communicates a sense of informal treatment of this proposal despite the fact that, if implemented, the proposal will have grave repercussions within the construction contractor community.

OFCCP’s statement also ignores the reality that even if the re-inflated and revised CC-257 Report met legal muster in all respects that most construction contractors (especially construction contractors) do not…

Monday, February 26, 2024: GAMECHANGER: OFCCP Proposed Changes to Construction Compliance Review Scheduling Letter, Itemized Listing, and Construction Contract Award Notification Requirement Form

OFCCP published a Notice in the Federal Register seeking public comments on several changes to its Information Collection Requirements (“ICRs”) for federal construction contractors in conjunction with its request for Office of Management and Budget (“OMB”) approval to continue the ICRs pursuant to the federal Paperwork Reduction Act. The proposal includes significant changes to OFCCP’s Construction Contractor Scheduling Letter and Itemized Listing, including two new items and multiple new subparts to its existing Itemized Listing. OFCCP also proposes changes to OFCCP’s Construction Contract Award Notification Requirement Form CC–314. However, the notice itself does not list the substantive proposed changes. Details on the changes were revealed in the 34-page Supporting Statement that OFCCP submitted to OMB. The proposed revised Construction Contractor Scheduling Letter and Itemized Listing are available here, and the proposed revised Form CC-314 is available here.

Comments on the proposed changes are due on April 26, 2024, and can be submitted here or here.

Current Documents

OMB last approved OFCCP’s Construction ICRs, including its audit Scheduling Letter and Itemized Listing, without substantive change on November 22, 2022. That approval expires on July 31, 2024. Our story on that approval explained that the only change to the ICRs then was a minor change to OFCCP’s Construction Contract Award Notification Form (Form CC-314) to add a missing e-mail address field for the “Contractor Awarded Contract or Subcontract.” At that time, there was no change to the Construction Scheduling Letter and Itemized Listing.

The Construction Contractor Scheduling Letter includes an Itemized Listing with three parts to cover the three laws OFCCP enforces: Executive Order 11246 (“EO 11246”), Section 503 of the Rehabilitation Act of 1973 (“Section 503”), and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (“VEVRAA”).

What Are the Proposed Changes?

Throughout the Supporting Statement, OFCCP made repeated references to the changes it implemented in August 2023 to the Supply and Service Scheduling Letter and Itemized Listing. (See our stories here and here for details on those changes.) The changes OFCCP proposed to the Construction Contractor Scheduling Letter and Itemized Listing are detailed below.

Tuesday, February 20, 2024: Plaintiff Amended Novel Complaint Alleging Certain AI Applicant Screening Tools Discriminated Based on Race, Age, & Disability

Complaint Seeks Class Action Certification

As we anticipated, a potential lead plaintiff in a case seeking class action certification filed an amended complaint alleging that Workday, Inc., violated federal anti-discrimination laws by providing companies with algorithm-based applicant screening, or “AI” (“Artificial Intelligence”) tools that discriminated against him and other similarly situated job applicants based on race, age, and disability.

Last month, we reported that Judge Rita F. Lin of the United States District for the Northern District of California (San Francisco) ruled that the plaintiff did not, in his initial complaint, allege the necessary facts to state a plausible claim that Workday is liable as an “employment agency” under the anti-discrimination statutes at issue (Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, and the Age Discrimination in Employment Act). However, Judge Lin allowed the plaintiff an opportunity to amend his complaint and spent a significant amount of her written opinion providing the plaintiff with instructions on how to replead his claim. The case is Mobley v. Workday, Inc. (No. 3:23-cv-00770).

In his amended complaint, the plaintiff asserted that Workday is “an agent of employers who have delegated to it authority to make decisions in the hiring process, including by relying on the results of selection procedures that Workday administers on the employers’ behalf to make hiring decisions, alternatively Workday is an indirect employer because it controls access to employment opportunities.”

Moreover, Plaintiff Mobley alleged that:

“Workday’s algorithmic decision-making tools lack sufficient guardrails to prevent discrimination. The conscious failure to include such guardrails is intentional and shows a reckless disregard for the anti-discrimination laws.

Further, lack of guardrails creates a phenomenon referred to as AI drift. AI drift occurs when an AI system’s performance and behavior change over time, often due to the evolving nature of the data it interacts with and learns from. This can result in the Artificial intelligence system making predictions or decisions that deviate from its original design and intended purpose. ‘AI drift can perpetuate or amplify existing biases present in training data, leading to discriminatory or unfair outcomes. For instance, a hiring AI might start favoring certain demographics or perpetuating gender or racial biases’ . . . i.e., disparate impact.”

Mobley also asserted that Workday uses data mining “to detect patterns and assist in making future decisions.”

Wednesday, February 21, 2024: Senate HELP Committee Scheduled February 27 Hearing on Renomination of Julie Su for U.S. Labor Secretary

On February 27, the U.S. Senate Health, Education, Labor, and Pensions (“HELP”) Committee is scheduled to hold an Executive Session on the renomination of Julie Su for Secretary of Labor. We reported last month that, on January 8, President Biden formally sent the renomination to the U.S. Senate. Our story last month also details the most relevant prior developments in this ongoing saga.

Thursday, February 22, 2024: Heard on The Street – OFCCP Switching Staff Up a Bit

OFCCP’s Southeast Regional Director, Aida Collins, is leaving the agency for a position at the Department of Energy, the WIR reporting team has unofficially heard. Collins has served as OFCCP Southeast Regional Director since June 4, 2021. Until OFCCP selects a new Southeast Regional Director, we understand that OFCCP’s Acting Director Michele Hodge will also serve as the Acting Southeast Regional Director, with support from OFCCP’s Acting Deputy Director, Tina T. Williams.

Also of note, in September 2023, Diana Sen left her position as Regional Director for OFCCP’s Northeast Region on leave to the U.S. Justice Department, serving as Senior Counselor in the Civil Rights Division. Ms. Sen began serving as OFCCP’s Northeast Regional Director in December 2012.

Friday, February 23, 2024: U.S. EEOC Published Corrections to its Interim Final Rule Amending Procedural & Administrative Regulations to Include PWFA

The U.S. Equal Employment Opportunity Commission (“EEOC”) published a two-page Notice in the Federal Register with some textual corrections to its Interim Final Rule to Amend Procedural & Administrative Regulations to Include the PWFA. As we reported last week, the EEOC published the Interim Final Rule on February 14.

According to the notice, “[d]ue to drafting errors, two of those changes would not be recognized in the Code of Federal Regulations as drafted, and the Commission therefore issues these correcting amendments to ensure that its procedural regulations reference the PWFA where appropriate.”

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.