OFCCP Week In Review: March 18, 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:

• Biden “Hits the Brakes” on Non-Defense Discretionary Budgets for Federal Agencies Joining Congress’ Historic Pivot Away from Both Bigger Federal Agencies and Bigger Social Programs
• U.S. EEOC’s FY 2023 Annual Performance Report Touted 29.5% Increase in Monetary Remedies Over Previous Year
• Biden Administration Marked Annual “Equal Pay Day”
• U.S. EEOC’s Data Dashboard for Limited 2017 & 2018 EEO-1 Component 2 Pay Data Collection Shows Both Sex & Race Disparities
• In Brief
• New Publications
• Looking Ahead: Upcoming Date Reminders

Monday, March 11, 2024: Biden “Hits the Brakes” on Non-Defense Discretionary Budgets for Federal Agencies Joining Congress’ Historic Pivot Away from Both Bigger Federal Agencies and Bigger Social Programs

President Proposes a Flat-Line Federal Agencies Budget Even with FY 2023 & FY 2024 Spending

With the Presidential election now less than eight months away, and with 57% of  America’s voting public reporting that they feel that reduction of the federal deficit should be a top priority for the President and Congress (up 12% from two years ago), the President “trimmed sail” and tacked hard to the middle in his FY 2025 budget proposal for Non-Defense Discretionary (“NDD”) spending for federal agencies.

Fiscal Year 2025 will begin on October 1, 2024. Specifically, the President’s proposed FY 2025 Budget is for only $770 Billion in Non-Defense Discretionary spending for the federal civilian agencies.

Reversal of Fortunes

President Biden’s FY 2025 NDD spending proposal of $770 Billion is down $44 Billion from the President’s FY 2024 proposal to spend $814 Billion for that same budget category in the current Fiscal Year. Biden’s FY 2025 $770 Billion NDD budget is also slightly below the $772.5 Billion Congress authorized and the President signed into law for FY 2023 for NDD spending which was a $ 83.5 Billion increase from the enacted FY 2022 NDD budget.

Congress has consistently resisted the President’s NDD budget proposals since enactment of the FY 2022 budget and authorized only $772.5 Billion in FY 2023. For the entirety of FY 2024 (still in progress but without a FINAL line-item budget bill, yet), Congress agreed on January 9, 2024, to hold the FY 2024 NDD budgets to the FY 2023 $770 Billion level for FY 2024 as we first reported here. With Congress now “standing on the brakes,” the President has started his FY 2025 budget proposal at the $770 Billion NDD number Congress has twice in the last two years told him he may NOT exceed. This is in stark contrast to the $118 Billion (8.4%) increase in NDD spending President Biden requested for FY 2022 and the $25 Billion increase in the FY 2022 NDD budget Congress passed and President Biden signed into law. It is now clear that “the good old days” of the President “asking for the sun, the moon, and the stars” and accepting the “sun and the moon” are over.

Proposed Biden NDD Increase		NDD Enacted
FY 2022	$118 Billion (8.4%)	$25 Billion increase to $689 Billion
FY 2023	$78 Billion (11.3%)	$83.5 Billion increase to $772.5 Billion
FY 2024	$330 Billion (43%)	$0 increase; Flatline agreement at $770 Billion
FY 2025	$0 increase (0%)	$ TBD; Congress has begun to consider

Note: Congressional Budget Office (“CBO”), a neutral arm of the Congress, routinely reports Enacted Budgets higher than what The White House reports and which the popular press uncritically reports to the public. (For example, the popular press reports the NDD ENACTED budget for FY 2023 to be only $770 Billion, but the CBO reports $917 Billion). Also, the CBO does not report spending for Fiscal Years still in progress, as is the case with FY 2024, the current Fiscal Year which has just passed its mid-point, or as to the FY 2025 budget proposed last week.

Remember: There are two types of federal budgets: the “mandatory” federal spending budget (over which the Congress expends no discretion to fund (covering expenses which are automatically paid pursuant to statute, including most notably Social Security, Medicare, SNAP, and the interest paid on the federal debt, among other expenses). The “mandatory” budget spending is about 2/3rds of the annual federal budget. The other 1/3^rd is what President Biden was addressing in putting forward a PROPOSED budget for Congressional review and approval to fund the federal agencies in amounts in the discretion of Congress. Congress exercises this discretion by passing 12 different budget bills it then sends to the President to sign into law, or to veto. The “discretionary” budget in turn, as noted above, is broken into a “Defense Discretionary” budget and eleven “Non-Defense Discretionary” (“NDD”) budgets for the federal agencies.

As Congress continues to haggle over the specific line-item apportionments of budget to be awarded to each federal sub-agency within each of the federal departments even after having agreed on January 9, 2024, to a “top-line” number for the NDD budgets (see our latest story here), President Biden announced his $7.3 Trillion (total) budget proposal for fiscal year (FY) 2025. The White House Office of Management and Budget’s (OMB) Appendix to the FY 2025 Budget document contains the specific allocations the President proposes for each agency next year.

Compared to the President’s FY 2024 budget proposal (see our story here), the FY 2025 request generally proposed more modest increases for the agencies relevant to our reporting, and in some cases, zero staffing increases.

The Congressional Budget Justification (“CBJ”) for each agency relevant to our reporting are included in the embedded links as follows:

• Department of Labor (“DOL”), including OFCCP, the Bureau of Labor Statistics, Employment and Training Administration, Office of Disability Employment Policy, Office of Labor-Management Standards, Occupational Safety and Health Administration, Veterans’ Employment and Training Service, Wage and Hour Division, and DOL IT Modernization;
• Equal Employment Opportunity Commission (“EEOC”); and
• National Labor Relations Board (“NLRB”).

Two Percent Federal Employee Pay Raise

The proposal includes an average two percent pay raise for federal civilian employees. The U.S. Office of Personnel Management’s Executive Summary provides specifics. For more information, including an overview of raises in recent years, see here and here.

Labor Department’s Overall Budget Request – 2.21% increase sought

The DOL’s 70-page Budget in Brief (“BIB”) document is here.

Because the final FY 2024 Department and sub-agency budgets are still in limbo, the list below details the amounts the DOL requested in its FY 2025 CBJ compared with the numbers the Administration estimates for FY 2024. The estimates assume the agencies are operating under the Continuing Appropriations Act, 2024 and Other Extensions Act (Division A of Public Law 118-15, as amended). That was the Continuing Resolution (“CR”) passed in September 2023, which was the first of four CRs on the FY 2024 budget so far. As of now, the DOL/OFCCP, the EEOC, and the NLRB are funded at current (FY 2023) levels through March 22, 2024 (and each Department will continue to be so funded to the end of FY 2024, even while any particular sub-agency could be awarded more or less budget than it received in FY 2023). The amounts included for the FY 2024 estimate reflect the annualized level provided by the September 2023 CR.

“FTEs” stands for full-time equivalent employees. The percentage increase numbers are rounded up or down to the nearest two decimal points. Page references below are all to the print copy pages (to match up with the Table of Contents) of the BIB.

Overall, the President requested $13.9 Billion for the DOL (see page 1 of the BIB). This request is $0.3 Billion over the FY 2024 estimate of $13.6 Billion, marking a 2.21 percent budget increase request. The request includes 15,762 FTEs, which is an increase of 342 over the FY 2024 estimate of 15,420, marking a 2.2 percent increase.

The above numbers do not include additional mandatory funding and supplemental FTEs.

Labor Department’s Agency-Specific Budget Requests

OFCCP (page 37) – 4.65% increase sought:

OFCCP’s FY 2025 request is $116,132,000 and 492 FTEs. The FY 2024 estimates are $110,976,000 and 492 FTEs. That is a 4.65 percent budget increase and a 0 FTE increase.

OFCCP states it will use this requested allocation to build on its Mega Construction Project Program and focus on the development of strong systemic cases, with an emphasis on hiring and a strategic approach to pursuing compensation indicators.

Editor’s Note: So, OFCCP is hoping to build software to assist contractor selection for audit and enforcement analyses. Whether OFCCP gets this budget increase or not, expect fewer audits in the coming 18 months.

Bureau of Labor Statistics (page 46) – 2.13% increase sought:

The BLS FY 2025 request is $712,786,000 and 2,023 FTEs. The FY 2024 estimates are $697,952,000 and 2,023 FTEs. That is a 2.13 percent budget increase and a 0 FTE increase.

Employment and Training Administration (page 10) – 5.08% DECREASE sought:

ETA’s FY 2025 request is $3,930,587,000. The FY 2024 estimate is $4,140,911,000. That is a 5.08 percent budget DECREASE.

Office of Disability Employment Policy (page 52) – 4.36% increase sought:

ODEP’s FY 2025 request is $44,876,000 and 63 FTEs. The FY 2024 estimates are $43,000,000 and 63 FTEs. That is a 4.36 percent budget increase and a 0 FTE increase.

Office of Labor-Management Standards (page 40) – 4.80% increase sought:

The OLMS FY 2025 request is $50,845,000 and 208 FTEs. The FY 2024 estimates are $48,515,000 and 208 FTEs. That is a 4.80 percent budget increase and a 0 FTE increase.

Occupational Safety and Health Administration (page 42) – 3.66% increase sought:

OSHA’s FY 2025 request is $655,463,000 and 1,980 FTEs. The FY 2024 estimates are $632,309,000 and 1,962 FTEs. That is a 3.66 percent budget increase and a 0.92 percent FTE increase.

Veterans’ Employment and Training Service (page 26) – 0.58% increase sought:

The VETS FY 2025 request is $337,301,000 and 237 FTEs. The FY 2024 estimates are $335,341,000 and 237 FTEs. That is a 0.58 percent budget increase and a 0 FTE increase.

Wage and Hour Division (page 34) – 11.08% increase sought:

WHD’s FY 2025 request is $349,901,000 and 1,588 FTEs. The FY 2024 estimates are $315,000,000 and 1,401 FTEs. That is an 11.08 percent budget increase and a 13.35 percent FTE increase.

IT Modernization (page 56) – 2.97% increase sought:

The FY 2025 request contains a separate line item for DOL IT Modernization. The overall DOL IT Modernization FY 2025 request is $35,286,000 and 24 FTEs The FY 2024 estimates are $34,269,000 and 18 FTEs. That is a 2.97 percent budget increase and a 33.33 percent FTE increase.

Agencies Outside DOL

EEOC – 7.30% increase & NLRB – 6.94% increase sought

The President proposed increasing the FY 2025 EEOC budget to $488,221,000. Unlike the DOL CBJ, the EEOC CBJ does not contain FY 2024 estimates, rather it makes comparisons to its FY 2024 Budget request and the actual FY 2023 appropriations. In light of the fact that the applicable CR funds the agency at the FY 2023 enacted levels, our calculations reflect the difference between the FY 2025 request and the FY 2023 enacted levels. The FY 2023 enacted level was $455,000,000. That is a budget increase request of 7.30 percent.

The President requested $320,002,000 and 1,308 FTEs for the NLRB in FY 2025. Like the DOL, the NLRB CBJ contains FY 2024 estimates. The FY 2024 estimate is $299,224,000 and 1,258 FTEs. That is a 6.94 percent budget increase and a proposal to increase FTE by 3.97 percent.

Editor’s Note: The cumulative effect of flat-line budgets for the last two Fiscal Years, combined with 9.8% in wage increases (4.6% in FY 2023 and (an historic) 5.2% increase in FY 2024) and the 2% the President has granted federal employees for FY 2025 is significant. Those two actions, alone, mean that most federal agencies must cut either “heads or programs”) to keep up with these rising costs of “doing business,” AMONG THEIR SEVERAL OTHER RISING COSTS. Many agencies devote 80% or more of their budget to payroll/benefits costs. An increase in wage costs alone of 11.8% (4.6% + 5.2% + 2.0%) x 80% means the agencies have to divert almost 9½% of their budgeted monies just to cover wage increases.

Companies signatory to “Federal Financial Assistance” (aka “grants”) contracts (as opposed to federal contracts for supplies, services, and construction) will be the first to feel the downshift in spending in Washington. Historically, most federal agencies have tried to balance their books when available budget gets tight by first canceling outstanding “grant” awards and non-renewing them upon expiration. Federal agencies also have the discretion and legal right not to renew multi-year contracts, perhaps for five years renewable in one-year increments.

Epilogue: Congress will more likely than not finalize the FY 2024 budgets in this month of March and will then turn to see how much it wants to cut from President Biden’s FY 2025 proposed budget.

Monday, March 11, 2024: U.S. EEOC’s FY 2023 Annual Performance Report Touted 29.5% Increase in Monetary Remedies Over Previous Year

Marking a 29.5 percent increase over fiscal year (“FY”) 2022, the U.S. Equal Employment Opportunity Commission (“EEOC”) obtained over $665 Million in monetary benefits for victims of discrimination in FY 2023, according to the agency’s FY 2023 Annual Performance Report. That was a $152 Million increase compared to FY 2022 during which the EEOC recovered approximately $513 Million for employees and applicants.

It is disheartening, however, that about 30% ($202 Million) of the Commission’s total ($665 Million) backpay collection came from unlawful federal government discrimination against 5,943 federal employees and applicants. That $202 Million total also represented an average payout to federal employees of almost $34,000 per alleged victim, almost $5,000 more than the Commission collected for 15,143 alleged victims for whom the agency collected $440.5 Million from private sector employers.

Note: Moreover, the incidence of unlawful discrimination findings (5,943) among the approximately 2,250,000 (2¼ Million) federal civilian agency employee population is approximately 1 out of every 378 employees (1:378) while the incidence of unlawful discrimination findings in the approximately 135,000,000 (135 Million) private sector employee population is reportedly only about 1 out of every 9,000 employees (1:9,000). The incidence of unlawful discrimination the EEOC is finding in the federal sector civilian employee population is thus almost 24 times greater than in the private sector.

Editor’s Note: There is certainly something wrong with the exceedingly high incidence of reported unlawful discrimination in the relatively small federal civilian employee population (barely larger than Walmart’s worldwide employee population). Is more training of federal managers needed? Would the result be the same if private sector defense employment lawyers represented the federal agencies against their claimants? What accounts for this stark statistical disparity? Are the federal civilian agencies holding their managers accountable for their unlawfully discriminatory actions to minimize (and hopefully eliminate) repetition of their unlawful conduct?

And, if the EEOC’s civilian federal agency discrimination findings are meritorious and true, what difficult conditions these federal civilian agency workplaces must be as a place to work given that they appear to be so rife with rampant unlawful employment discrimination. Federal civilian employees should not have to remain subjected to these discriminatory work environments. It seems like it would be a worthwhile endeavor were the United States Department of Justice Civil Rights Division to open a civilian-agency wide investigation of these EEOC findings to determine which federal civilian agencies have the highest incidences of reported unlawful discrimination and to then learn why there is such rampant unlawful discrimination in the federal civilian workplace if it is true.

The agency’s performance during FY 2023 “reflects both an increased demand for its services and significant remedies for workers who suffered discrimination,” according to a corresponding EEOC statement. “This includes handling more than 522,000 calls from the public through the agency contact center and a 10 [percent] increase in receipts of private sector charges of discrimination, while recovering more than $665 million on behalf of victims of discrimination,” the statement continued.

While the FY 2023 Report is dated February 23, 2024, the EEOC did not announce or post the Report until March 11, 2024.

Other highlights of note touted by the Commission include:

• filing 143 new lawsuits, an increase of more than 50 percent compared to FY 2022, including 86 suits on behalf of individuals, 32 non-systemic suits with multiple victims, and 25 systemic suits involving multiple victims or discriminatory policies;
• obtaining more than $22.6 Million for 968 individuals in litigation, while resolving 98 lawsuits and achieving favorable results in 91 percent of all federal district court resolutions;
• “successfully resolving” 46.7 percent of conciliations;
• receiving 81,055 new discrimination charges, an increase of nearly 10.3% compared to fiscal year 2022;
• reducing both private and federal sector inventories, including reducing the private sector inventory by almost 300 charges, despite the 10.3 percent increase in new charges;
• continuing to modernize agency data collections and data dissemination activity to align with the Federal Data Lifecycle Framework and ensure compliance with the provisions of Title VII, the Paperwork Reduction Act, and other applicable laws;
• continuing to streamline the recruitment process to improve time-to-hire rates and reach and maintain authorized staffing plan levels, including filling 493 new positions and ending the fiscal year with 2,331 employees on board. All hires were made within an 80-day deadline, utilizing special hiring flexibilities, such as Schedule A appointments for persons with disabilities, veteran appointments, the Pathways Program; college graduate hiring authority; law clerks; and interagency lateral transfers; and
• developing employees and addressing skills gaps for the agency’s mission-critical occupations to improve effectiveness and organizational results and to increase employee retention.

Tuesday, March 12, 2023: Biden Administration Marked Annual “Equal Pay Day”

As usual, the Biden Administration took multiple actions to mark the annual “Equal Pay Day” for 2024 – the day that marks how far into the year women, on average, must work to earn what men, on average, were paid the year before.

The day prior, President Biden issued the annual National Equal Pay Day Proclamation. In it, he highlighted some of his Administration’s recent efforts to address the issue. He also called upon Congress to pass the Paycheck Fairness Act, currently pending in both the House and Senate. Though pending over the current and several earlier Congressional sessions, Congress has not, thus far, passed the measure (see our stories here and here for more details).

The White House also issued a “Fact Sheet” to announce some new administrative actions focused on this topic. Among the actions noted are:

• The Equal Employment Opportunity Commission released a “Data Dashboard” based on the limited-run EEO-1 Survey Component 2 pay data collection for reporting years 2017-2018. The dashboard provides multiple graphic displays to illustrate aggregate, employer-level workforce demographic and pay data, across 12 pay bands. We discuss that dashboard – which shows disparities based on both sex and race across industries, job categories, and geography – in more detail in a separate story in this week’s edition.
• The Women’s Bureau at the Department of Labor (“DOL”) issued an update to its Bearing the Cost report, that analyzes the impact of “occupational segregation.” That term is defined as the overrepresentation of women and people of color in occupations and industries that pay less, and their underrepresentation in occupations and industries that pay more. The report cites other US DOL reports and Census Bureau data, including the American Community Survey. In the update, the DOL found that Black women lost $42.7 Billion in wages compared to white men in 2023, and Hispanic women lost $53.3 Billion in wages. “Job segregation is a long-standing driver of the persistent pay inequities experienced by women in the [United States],” according to a corresponding DOL press release.
• While the Update is short on underlying data supporting its sweeping conclusions, the Bureau offered three reasons it had found for job segregation in America unrelated to allegedly unlawful employer actions:
  • “Social norms can pressure workers into jobs stereotypical for their gender or race/ethnicity… .”
  • “Educational attainment, sorting, and training gaps can create barriers for women to enter certain occupations: They are less likely to graduate with degrees in math or science or complete vocational training programs and registered apprenticeships.”
  • “Family caregiving duties that are disproportionately performed by women limit the time they can spend on paid work and the types of jobs they can accept.”

The Bureau also gave no indication of which of the several drivers of wage segregation drove the greatest result or which job selections were voluntary and appreciated by the workers in the various statistical columns and rows or whether there was universal dissatisfaction with the jobs these millions of workers had chosen (or took for lack of choice).

Tuesday, March 12, 2024: U.S. EEOC’s Data Dashboard for Limited 2017 & 2018 EEO-1 Component 2 Pay Data Collection Shows Both Sex & Race Disparities

Dashboard Aggregates Data & Reports It Across 12 Pay Bands

Agency Gearing Up to Resume Pay Data Collection

Struggling for the past 5 years to justify and make relevant the reported $600 Million employers in the United States spent in 2019 to respond to the EEOC’s EEO-1 Survey Component 2, the U.S. Equal Employment Opportunity Commission (“EEOC”) unveiled a newly compiled “Data Dashboard” based on the EEO-1 Survey Component 2 data collection for reporting years 2017-2018. The dashboard provides multiple graphic displays to illustrate employer-level workforce demographic and pay data, across 12 pay bands. It shows disparities based on both sex and race across industries, job categories, and geography. The data also shows that sex-based pay disparities tend to be larger in the higher pay bands than in the lower. The EEOC asserts that the dashboard will allow employers to assess generally how their pay by sex and race compares to others in their industry, job category, or state. The EEOC did not and cannot, however, vouch that the jobs it compared were staffed with “similarly situated” employees with like work tasks, knowledge, skills, abilities, and working hours.

In a corresponding press release, the EEOC stated it aggregated the data to protect the confidentiality of employees and employers. About 70,000 private employers and certain federal contractors with 100 or more employees each year, representing over 100 million workers, reported data in the 2017 and 2018 pay data collection, the Commission noted.

The press release also contains several charts that illustrate the median pay band data broken down by sex, race and ethnicity, industries, job categories, and geography (U.S. states).

In addition, the EEOC provided for download a public use file to further explore this data collection. More information on accessing the dashboard and how to use the tools is available in the EEOC’s User Guide and FAQs.

Cautionary Note

Before delving into additional detail, it is important to note that the National Academies of Sciences, Engineering, and Medicine (“NASEM”) found several issues with this data collection. In the Summer of 2022, we reported that the NASEM issued its much-anticipated Report evaluating the quality of this data collection. The expert panel assigned to conduct the study found that this “data as collected have value” as they are unique among federal surveys by providing employee pay, occupation, and demographic data at the employer level. However, the panel recommended that “the value be strengthened by both short-term and longer-term improvements in respondent coverage, data collection protocols, measurement implementation, and conceptual coverage.” The NASEM also posted a summary page on the Report. Furthermore, the expert panel followed up the Report’s release with a webinar in which panel members discussed the data instrument’s flawed design and various problems with the data collected (see our story here.)

Dashboard Shows Pay Disparities Based on Sex and Race

“The dashboard illustrates what we have long known—that pay disparities based on sex and race persist in almost every industry both at the national level and in nearly every state,” EEOC Chair Charlotte A. Burrows said in the press release. Significantly, Chair Burrows did not ascribe a driver of these disparities or lay them at the feet of employers.

“Women are paid less than men in the aggregate, and Black women and American Indian or Alaska Native women are paid the least,” she continued. “In addition, Black and Hispanic employees generally were in lower median pay bands than white employees in the same industries and job categories.”

In Corresponding FAQs, EEOC Reports Steps Toward Future Pay Data Collection

The EEOC did not report, however, that despite expectations that it would last year or this year again attempt to impose an EEO-1 Component 2 Hours Worked and Pay Dating Reporting requirement on almost 100,000 employers in the United States, that the agency had punted the reporting to the next Presidential Administration if Democrats again occupy The White House. Of note, Item #6 in the FAQ stated:

“6. Does the EEOC plan to collect pay data again?

Advancing equal pay for all workers is a key priority for the EEOC, as memorialized in the agency’s Strategic Enforcement Plan for Fiscal Years 2024-2028. The National Academies of Sciences, Engineering, and Medicine (National Academies) studied the EEOC’s historic, first-time collection of pay data and concluded in a Consensus Study Report that a federal pay data collection is necessary to identify and combat pay discrimination effectively. The National Academies also made recommendations for the EEOC to consider in any future pay data collections to enhance the value of the data to the EEOC and the public and reduce the potential burden on employers. Since the Consensus Study Report was issued, the EEOC has been rigorously examining its findings and recommendations and hearing from advocates, researchers, employers, and employees about next steps. Any new pay data collection would be preceded by additional and formal opportunities for public input, including public notice and a public hearing, and any such collection would be informed and guided by that public input.”

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.