The FAR Council and the Department of Labor have published the final versions of their respective final rule and DOL guidance implementing the President’s July 2014 Executive Order entitled “Fair Pay and Safe Workplaces”—EO 13673.

Detractors frequently refer to EO 13673 as the “Blacklisting” or “Bad Actors” Executive Order. The order and the new regulations purport to promote efficiency in government procurement by ensuring that federal agencies contract only with “responsible” contractors that comply with federal and state workplace protection laws.

This objective is already a well-established requirement of the government’s procurement rules. The regulations impose additional administrative burdens on current and future contractors, adding an element of uncertainty to future contract award decisions, but only achieving marginal improvements in workplace law compliance. Continue Reading Fair Pay and Safe Workplaces—the final rules implementing Executive Order 13673

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 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

Submitted by Husch Blackwell Associate Kayt Kopen

Federal contractors will soon need to update their Equal Employment Opportunity policies and their Affirmative Action Plans. According to an announcement by DOL’s Office of Federal Contract Compliance Programs, federal contracts and subcontracts awarded or modified after April 8, 2015, must include new contract language prohibiting discrimination on the basis of sexual orientation or gender identity. The new rule implements Executive Order 13672, signed by President Obama on July 21, 2014.

For most purposes, the new rule requires contractors to treat sexual orientation and gender identity just like race, color, religion, sex, and national origin. It prohibits discrimination and segregation, for example, and requires contractors to take affirmative action to ensure the fair treatment of job applicants. Contractors will be required to flow down the new requirements to their subcontractors, to put up new notification posters, and to refer specifically to sexual orientation and gender identity in job postings.

But not all of the requirements carry over directly from existing law. Contractors will not be required to include sexual orientation or gender identity in their affirmative action placement goals or to collect or analyze data to quantify their compliance. Contractors also will not be required to ask individuals to identify themselves on the basis of sexual orientation or gender identity.

DOL’s list of answers to frequently asked questions about the new rule is available here.


Related entries—

OFCCP’s five-year moratorium on enforcement actions against Tricare providers (Apr. 14, 2014)

Affirmative action for protected veterans and individuals with disabilities (Sept. 19, 2013)

TRICARE hospitals and pharmacies are not subcontractors (Jan. 9, 2012)

OFCCP’ push for a 7% disabled workforce (Dec. 27, 2011)


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.

Continue Reading OFCCP’s new hiring policies under attack

Under the OFCCP’s final rule announced on August 27, 2013, federal contractors and subcontractors that meet the applicability criteria will be required to meet new goals for hiring protected veterans and individuals with disabilities. For veterans, the new “benchmark” is based on the percentage of veterans in the civilian labor force (currently 8 percent) or another figure that reflects the contractor’s unique hiring circumstances. 78 Fed. Reg. 58613 (Sept. 24, 2013) [pdf].  For individuals with disabilities [pdf], the “placement goal” is 7 percent, measured by job groups. 78 Fed. Reg. 58681 (Sept. 24, 2013) [pdf].

In addition to requiring contractors to implement and keep records reflecting their compliance with the new percentage benchmarks and goals, here are some key features of the new rule:

  • Flowdown of the Equal Opportunity clause. The precise language and appearance of contract clauses that impose the affirmative action requirements on subcontractors are specified.
  • Job listing requirements. Contractors will be required to state specifically that they are equal opportunity employers of protected veterans and individuals with disabilities.
  • Invitation to self-identify. Job applicants must be given an opportunity to self-identify as a protected veteran or as an individual with disabilities before they are given an offer of employment. OFCCP intends to publish a form for use by contractors in making this inquiry. All employees must be given an opportunity to self-identify as an individual with disabilities within a year after the rule is effective and thereafter at least every five years.
  • Data collection. Contractors will be required to document and update quantitative data on the number of veterans and individuals with disabilities that apply for jobs and the number that are hired.
  • OFCCP access to records. Contractors are required to allow OFCCP broader access to records needed to verify their compliance. Records would have to be provided on-site or off-site and in any format that OFCCP requests.

The new requirements are expected to go into effect in March 2014. Contractors with a written affirmative action plan in place on the effective date of the new rules will have until the date of their next affirmative action plan year to implement the goal-setting and self-identification requirements.

For more information on the final rule and the specific requirements imposed on federal contractors and subcontractors, Hush Blackwell’s client update is available here. Background on OFCCP’s initiatives for individuals with disabilities is available in these earlier blog entries:

OFCCP’S push for a 7% disabled workforce (Dec. 27, 2011)

Morbid obesity as a disability under the ADA (Oct. 3, 2011)

Just one month after its decision in United Space Alliance, the District Court for the District of Columbia has again addressed the question of limits on OFCCP’s audit rights. In Bank of America N.A. v. Solis, No. 09-2009 (D.D.C. Dec. 13, 2011) [pdf], United States Magistrate Judge Deborah A. Robinson issued a report and recommendation adopting the Fourth Amendment’s prohibition against unreasonable search and seizure as a limit on OFCCP’s ability to select contractors for audit.

Continue Reading OFCCP document requests as an unreasonable search and seizure

The National Defense Authorization Act for Fiscal Year 2012 [pdf] puts an end to OFCCP’s effort to impose subcontractor status on retail pharmacies and health care providers serving TRICARE beneficiaries. The controversy had been brewing for some time. As we discussed in an earlier client alert, the October 2010 decision in OFCCP v. Florida Hospital, No. 2009-OFC-00002 (DOL Oct. 18, 2010) [pdf] concludes that a TRICARE network hospital is a subcontractor despite contract language indicating the federal government’s agreement to the contrary. Directive 293 expresses OFCCP’s intention to disregard party determinations of subcontractor status and to control the determination itself. Section 715 of the 2012 NDAA ends the uncertainty on this issue. Under the legislation, TRICARE network service providers and suppliers may not be considered subcontractors:

For the purpose of determining whether network providers under such provider network agreements are subcontractors for purposes of the Federal Acquisition Regulation or any other law, a TRICARE managed care support contract that includes the requirement to establish, manage, or maintain a network of providers may not be considered to be a contract for the performance of health care services or supplies on the basis of such requirement.

Husch Blackwell’s client alert on the new legislation is available here.


UPDATE: DOL later took the position that this statute did not limit the subcontractor status of TRICARE providers. In April 2014, DOL retreated from that position in response to Congressional oversight and imposed a five-year moratorium on enforcement actions against TRICARE hospitals and other providers. These developments are discussed in more detail in our April 4, 2014 article on Healthcare Law Insights.

Affirmative action requirements for disabled workers have always taken a back seat to those for women and minorities. New regulations proposed by the Office of Federal Contract Compliance Programs put recruiting and retention of disabled workers on center stage. OFCCP seeks to impose a hiring goal of 7% disabled workers and to enhance obligations for federal contractors in the areas of recruiting, training, and record-keeping. Husch Blackwell’s client alert on the proposed regulations is available here.

Chief Judge Royce Lamberth’s 46-page decision in United Space Alliance, LLC v. Solis, No. 11-746 (D.D.C. Nov. 14, 2011), introduces new uncertainties for contractors facing OFCCP investigations. The case arose from a 2009 OFCCP desk audit of United Space Alliance’s facility in Cape Canaveral, Florida. Applying DOL’s established practices to the initial compensation data provided by United Space Alliance revealed no discriminatory pattern. But DOL sought additional information because “it appeared that women were earning less more frequently than men.”  United Space Alliance refused, calling the request “unjustified.”

Continue Reading Responding to OFCCP document requests after United Space Alliance v. Solis

Activity by the Office of Federal Contract Compliance Programs points directly toward a new focus on discrimination in employee compensation. A settlement with AstraZeneca involving pay disparities averaging only $1,700 requires the company to conduct additional statistical analyses of pay for hundreds of employees. OFCCP rescinded the 2006 standards for assessing pay discrimination and published an advance notice of proposed rulemaking announcing a new data collection tool to identify potential pay discrimination. OFCCP Director Patricia Shiu articulates the plan in just a few words: “aggressively going after employers who discriminate.” We discuss these issues in a new client alert, available here.