Effective March 31, 2023, OFCCP rescinded the Trump administration’s Final Rule, Implementing Legal Requirements Regarding the Equal Opportunity Clause’s Religious Exemption (Final Rule). The Final Rule was issued in December 2020, during the waning days of the Trump administration. While the text of OFCCP regulation, 41 C.F. R. 60-1.5(a)(5) (OFCCP religious exemption), was not changed by the Final Rule, the Final Rule did add 1) a new paragraph with definitions to terms used in the religious exemption under Executive Order 11246 (E.O. 11246), and 2) a new rule of construction applicable to the religious exemption. The recission of the Final Rule follows OFCCP’s March 1, 2023 recission of Directive 2018-03, which contained the legal interpretations and policies reflected in the Final Rule.Continue Reading OFCCP Rescinds 2020 Final Rule Regarding Religious Exemption
As we wrote back in November 2021, the Biden Administration issued Executive Order 14055 reinstating most of the concepts from the Obama Administration era nondisplacement Executive Order 13495. Two months after Biden’s imposed deadline of May 2022, the U.S. Department of Labor finally published proposed regulations on July 15, 2022.
Generally speaking, EO 14055 and the proposed Nondisplacement regulations require successor contractors to make offers of employment to all predecessor contractor Service Contract Act covered employees who worked on the predecessor contract. Predecessor contractors are required to prepare and submit a list of their Service Contract Act covered employees to the contracting officer at least 30 days prior to contract termination. The contracting officer then provides a copy of that list to the successor contractor who then is required to make bona fide job offers to the predecessor’s service employees who worked on the prior contract. The rollout of these new regulations is of the utmost importance to any federal contractor or subcontractor with employees subject to the Service Contract Act.
Continue Reading Nondisplacement of Qualified Workers Under Service Contracts – Proposed Regulations Issued
A new Final Rule addressing sex discrimination in employment by federal contractors and subcontractors will go into effect on August 15, 2016. The new Final Rule was published by DOL’s Office of Federal Contract Compliance Programs. It implements Executive Order 11246, which has been essentially unchanged since it was first issued in 1970. OFCCP’s new rules and guidelines include several significant changes from the 1970 version, but the changes are primarily intended to update DOL requirements so that they conform to well-established federal caselaw and other more recently enacted federal requirements.
Who is affected?
OFCCP’s new Final Rule on sex discrimination applies to any business or organization that (1) holds a single Federal contract, subcontract, or federally assisted construction contract in excess of $10,000; (2) has Federal contracts or subcontracts that, combined, total in excess of $10,000 in any 12-month period; or (3) holds Government bills of lading, serves as a depository of Federal funds, or is an issuing and paying agency for U.S. savings bonds and notes in any amount.
What does the Final Rule address?
As they have for many years, DOL’s regulations require contractors to ensure nondiscrimination in employment on the basis of sex and to take affirmative action to ensure that they treat applicants and employees without regard to their sex. The new Final Rule is much more specific.Continue Reading Contractor guide to compliance with OFCCP’s new final rule on sex discrimination
The Department of Labor has issued its final rule amending the overtime and exemption regulations of the Fair Labor Standards Act. Although the final rule differs in some ways from the July 2015 proposed rule, it will have significant administrative and budgetary impacts on most employers. The new rule becomes effective December 1, 2016, and will update automatically every three years thereafter.
Continue Reading DOL’s new salary level tests for overtime pay
New OFCCP rules amending the nondiscrimination and affirmative action provisions of the Vietnam Era Veterans Readjustment and Assistance Act and Section 503 of the Rehabilitation Act are expected to be effective March 24, 2014. OFCCP has published a set of forms that are to be used in implementing the new rules, which are available in this client alert from Husch Blackwell’s OFCCP compliance team.
As we have discussed in several earlier posts, the new rules represent an aggressive move by OFCCP. They impose significant new recordkeeping obligations on federal contractors and subcontractors. They set high placement goals and hiring benchmarks for veterans and individuals with disabilities. They authorize OFCCP to obtain more contractor information during compliance reviews.
One of the key issues with the new rules is that they require federal contractors and subcontractors to ask job applicants and current employees whether they are individuals with disabilities. Such questioning is normally prohibited by the Americans with Disabilities Act. Needless to say, there has been a lot of opposition to the new OFCCP rules.
Jurisdictional issues arising from disputes about wages and benefits required by federal minimum wage statutes like the Davis-Bacon Act and the Service Contract Act can be tricky. In some cases, the Department of Labor has exclusive power to resolve such disputes. In others, the dispute must be resolved by the contracting officer, with appeal rights available under the Contract Disputes Act. The ASBCA’s recent decision in Caddell Constr. Co., ASBCA No. 57831 (May 21, 2012) [pdf] helps determine which cases fall on either side of this line.
The case arose from an Air Force contract to build a new commissary and related site work at Fort Campbell, Kentucky. The solicitation included two wage determinations—one for highway construction with low wage rates and another for building construction with much higher wage rates. Prior to bid, the agency told bidders to use the lower highway construction wage determination. During performance, the contracting officer required the contractor to pay wages according to the higher wage determination for building construction.
The contractor submitted a claim in accordance with the Contract Disputes Act. At the Board, the government moved to dismiss the appeal, arguing that such labor disputes are reserved to the Department of Labor. The Board denied the motion, holding that the Board has jurisdiction to hear disputes over wage issues “where there was an alleged mistake (mutual or unilateral) as to the applicability of the Davis-Bacon Act to appellant’s employees.” The Board concluded that it had jurisdiction to hear the contractor’s claim to recover additional wages paid to employees as a result of faulty wage rate information provided to bidders before submission of bids.
But why is this important?Continue Reading DOL isn’t the only game in town; Contract Disputes Act jurisdiction for wage disputes
The Department of Labor has announced its final rule [pdf] implementing Executive Order 13495 [pdf], which addresses nondisplacement of qualified workers under federal service contracts. Under the DOL rule, federal contractors and subcontractors on service contracts over the $150,000 simplified acquisition threshold will be required to offer employment to non-managerial employees whose employment would otherwise end at the close of the predecessor contract.Continue Reading The impact of DOL’s final rule on nondisplacement of qualified workers
Developments in the OFCCP’s investigation of compensation disparities at United Space Alliance, LLC are worthy of consideration. During a 2009 desk audit, OFCCP conducted a standard threshold test of United Space Alliance’s compensation data. Although this audit uncovered no indicators of pay discrimination, OFCCP conducted additional tests of the data, commonly known as the “pattern analysis” and the “30 and 5 Refinement” tests. These tests revealed potential pay bias, and OFCCP requested more extensive compensation data to examine the question more closely. The case begins when United Space Alliance refused to comply with OFCCP’s request.
Continue Reading United Space Alliance’s temporary agreement with OFCCP
On April 26, 2011, the Office of Federal Contract Compliance Programs formally proposed regulations to update contractor affirmative action obligations concerning veterans. The proposed rules impose additional obligations on covered federal contractors and subcontractors. For the first time, OFCCP is seeking to impose quantitative measurements to assess the hiring of protected veterans, self-identification invitations…
Once again a contractor covered by the Davis-Bacon Act has been penalized for not maintaining adequate payroll records. In Pythagoras General Contracting Corp. v. Dep’t of Labor, ARB Nos. 08-107 & 09-007, ALJ No. 2005-DBA-14 (Feb. 10, 2011) [pdf], the DOL’s Administrative Review Board upheld a determination to debar the contractor from getting any future federal contracts for up to three years and increasing the monetary penalty significantly.
Continue Reading Contractor debarred for inadequate payroll records