Hunton Employment & Labor Perspectives

This past week, the EEOC filed suit against 15 different employers located across 11 different states. There was one common theme in each action: an employer’s failure to complete EEO-1 Component 1 reports for both 2021 and 2022. By filing these lawsuits, the EEOC is requesting courts to order these employers to fulfill their requirement of providing their company’s workforce demographic data. These suits were filed just ahead of the deadline for employers to file their EEO-1 Component 1 report reflecting data from the 2023 calendar year, which is quickly approaching on June 4, 2024.

The start of spring has brought with it important deadlines and announcements from the EEOC, OFCCP, and the OMB regarding the reporting of employee demographic data to the federal government.

As announced by the Equal Employment Opportunity Commission (EEOC) earlier this year, the 2023 EEO-1 data collection process will open on April 30, 2024 with a deadline to file by Tuesday, June 4, 2024. Private employers with at least 100 employees and federal contractors with at least 50 employees can begin to report their data as of April 30, 2024 in order to meet the deadline.

On December 22, 2023, the Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA) published a final rule that could have consequential effects for federal construction contractors and subcontractors.  The rule, which implements President Joe Biden’s Executive Order 14063, directs agencies awarding “large scale construction contracts” to require the use of project labor agreements (PLA). 

On December 23, 2023, a federal District Court in California issued an order compelling the OFCCP to produce formerly-withheld EEO-1 reports to a news organization who submitted Freedom of Information Act (FOIA) requests for the reports. This order is significant because it compels the OFCCP to produce the EEO-1 reports for all federal contractors between 2016 and 2020. The plaintiff news organization submitted four FOIA requests to the OFCCP between 2019 and 2022 requesting all EEO-1 reports submitted by all federal contractors from 2016 through 2020. OFCCP published a notice in the Federal Register informing all contractors of the requests and an opportunity to object. OFCCP released all EEO-1 reports from all non-objecting contractors. The instant litigation relates to the EEO-1 reports of the objecting contractors.

On December 14, 2023, the U.S. Department of Labor (DOL) published a final rule that restricts federal contractors in who they can employ when carrying out federal service contracts under the Service Contract Act (SCA).  The final rule implements President Biden’s Executive Order signed on November 18, 2021, and goes into effect on February 12, 2024.  The DOL estimates that this rule will affect 1.4 million workers on service contracts.

In April 2021, President Biden issued Executive Order 14026, which increased the minimum wage for federal contractors to $15.00 per hour for contracts under the Service Contract Act and Davis-Bacon Act. The U.S. Department of Labor subsequently issued a final rule implementing the Executive Order, and the new $15.00 minimum wage for federal contractors took effect in January 2022, with annual increases thereafter.

On August 25, the Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) announced an updated Scheduling Letter and Itemized Listing that places a more onerous information disclosure burden on federal contractors in responding to a Supply and Service compliance audit. In particular the updated Scheduling Letter, OMB No. 1250-0003, now requires federal contractors to produce more documentation for a variety of Items and increases both the scope and breadth of requested compensation data.

The Office of Federal Contract Compliance Programs (OFCCP) recently published a final rule titled “Pre-enforcement Notice and Conciliation Procedures.”  This rule rescinds the evidentiary standards from the 2020 rule titled “Nondiscrimination Obligations of Federal Contractors and Subcontractors: Procedures to Resolve Potential Employment Discrimination,” which required specific pre-determination notice requirements and certain evidentiary standards. In a blog post, the OFCCP explains that the “new final rule restores flexibility to OFCCP’s pre-enforcement and conciliation procedures, promotes efficiency in resolving cases, strengthens enforcement and promotes alignment of the standards of Title VII of the Civil Rights Act of 1964.”

Federal contractors have had a flurry of headlines to keep up with over the last few months. Most prominent among them is the Federal Acquisition Regulatory Council’s interim rule barring federal agencies and contractors from using TikTok or any other ByteDance product (the “Covered Applications”). 

As discussed in prior blog posts, here, here, and here, pay equity is a hot topic for employee retention and compliance. This principle of equal pay for equal work has been mandated since the Equal Pay Act of 1963 and reiterated in Title VII of the Civil Rights Act of 1964. More recently, legislators at the federal, state, and local level have increased their focus on pay equity and pay transparency initiatives. Because of this legislative activity, pay equity has also received increased attention from the Plaintiffs’ bar, and in recent years, pay equity lawsuits have been brought with increasing frequency. Against this backdrop, employers face the tough task of navigating a complex patchwork of pay equity laws in order to achieve fair and legally-compliant compensation practices, while ensuring that their compensation decisions can reflect the reality of a workforce with differing job positions, responsibilities, and performance outcomes.

As pay equity has drawn more attention in recent years, employers need to stay abreast of the patchwork of federal, state, and local laws related to pay equity issues. Importantly, employers should understand the varying standards for protected characteristics, appropriate comparators, and accepted defenses under the varying laws of different jurisdictions. At a high level, this post summarizes the federal and state legal frameworks for pay equity claims and highlights the important differences in analyzing such claims.

As pay equity and transparency continues to trend in the news, states and localities have passed pay disclosure and transparency laws to further assist employees in evaluating whether they are being paid fairly. These laws vary in scope – some require the disclosure of pay ranges on job postings, others require employers to provide the pay scale for a position upon an applicant or employee’s request, and others require employers to automatically provide pay scale information at the time of hire. Despite their differences, all of these pay disclosure laws are aimed at adding transparency to conversations about pay.

OFCCP’s Director Leaves Agency For the White House

On March 29, 2023, the OFCCP announced Director of the Office of Federal Contract Compliance Programs (OFCCP), Jenny Yang, will leave her position to take on a new role at the White House. Specifically, Yang will join the White House Domestic Policy Council as a deputy assistant to the President for racial justice and equity.

Pay equity and transparency have become hot topics across the country as states and the federal government seek to ensure pay equity for employees, regardless of protected class. Federal anti-discrimination laws like the Equal Pay Act and Title VII provide legal recourse for employees who have experienced pay discrimination. As many employers know, federal law prohibits employers from demanding pay confidentiality from employees. Pay transparency laws go a step further and require employers to publish ranges for open positions, adding transparency to the conversations about ...

As employers know, the federal government’s New Year’s resolutions often do not make employers’ lives easier. The following are recent developments of which employers should be aware.