2018 Proposed Budget Released: DOL’s Budget Cut by $2.5B

President Trump’s budget blueprint dubbed as “America First” was released Thursday, March 16, 2017. The blueprint calls for a $1.15 trillion proposed budget that seeks to provide increased spending for the military and homeland security, while cutting the spending budget for other federal agencies, including the Department of Labor (DOL).

The Department of Labor’s 2018 proposed budget will be $2.5B (20.7%) less than the annualized continuing resolution (CR)[1] for 2017 and calls for the following:

  • The expansion of Reemployment and Eligibility Assessments – an activity by various States’ employment development departments to review the individual’s efforts to seek employment and to provide information on appropriate resources to assist the individual to return to work as quickly as possible.
  • Reduced funding to ineffective and duplicative training grants. This eliminates the Senior Community Service Employment Program (SCSEP) which was found to be ineffective in transitioning low-income unemployed seniors to unsubsidized jobs.
  • Elimination of the Bureau of International Labor Affairs’ largely noncompetitive and unproven grant funding.
  • Closing of Job Corps centers for the disadvantaged youths that do a poor job in educating and preparing students for jobs.
  • Decreased federal support and shifting more funding responsibilities to the States, localities, and employers for job training and employment service.
  • Helping the States to expand apprenticeship programs
  • Elimination of OSHA’s training grants and instead refocus the agency to keeping the workers safe on the job
  • Elimination of less critical technical assistance grants by the Office of Disability and Employment and instead launching an early intervention projects that will allow States to test and evaluate methods that will help persons with disabilities to remain connected to the labor market.

What about the OFCCP?

While the proposed 2018 budget is by no means final until approved by Congress, it nevertheless squelched some speculations on the fate of the Office of Federal Contracts Compliance Programs (OFCCP) under the Trump administration. If nothing else, the proposed budget revealed that the OFCCP is here to stay, will remain a separate agency from the EEOC, and affirmative action programs will still be enforced. However, much like other agencies, it is almost certain that the trickle-down effect of the proposed budget cuts will affect the OFCCP, particularly its request for an $8,693,000 budget increase and the retention of 615 full-time employees (FTEs) as outlined in its 2017 Congressional Budget Justification document. Should this really be an area of interest or concern to anybody besides the OFCCP?

While nobody can be sure of what will happen in the next few months, we can look back at the OFCCP’s budget and operation history and maybe, just maybe, look into our crystal ball to see what the future might hold for the federal contracting community? History shows that the OFCCP operated efficiently in much leaner years: from 2003 thru 2009, its appropriated budget ranged from $78M to $84M and with FTEs ranging from 585 (in 2008) to 749. How did the OFCCP survive with much tighter belt during those lean years? One answer lies in the issuance of the OFCCP’s Active Case Management (ACM) directive in July 2003. Under this directive, compliance officers (COs) were able to expedite audits — allowing them to close audits where no systemic discrimination was found — conduct more compliance evaluations, and direct their focus on organizations where more apparent discrimination occurs. The directive definitely allowed the OFCCP to do more with less and produced more financial settlements at higher dollar amounts.

With the possibility of the trickle-down effect of the proposed budget cuts, it will not be a stretch to think that the OFCCP will once again re-invent itself so it can continue to enforce the provisions of the regulations in the most effective and efficient way. This, not coincidentally, is one of the main thrusts of the new administration: improve “the federal government’s effectiveness, efficiency, cyber security, and accountability.” There is no doubt that everybody in the federal contracting community – prime and sub-contractors, lawyers, consultants, analysts, etc. – can expect another roller coaster ride with the probable changes in the OFCCP. In the meantime, hold onto your seats and stay compliant with the current regulatory requirements.


Helpful Resources:


[1] In December 2016, the Senate passed legislation to fund the federal government until April 28, 2017 to avoid a government shutdown.

OFCCP Releases Final Rule Revising Sex Discrimination Guidelines

The OFCCP announced the publication of a Final Rule on June 14, 2016, revising and replacing its current Sex Discrimination Guidelines. The revisions rescind procedures that have remained unchanged for over four decades to reflect a more accurate portrayal of current day organizational profiles. The Final Rule updates guidelines on a wide variety of issues ranging from compensation discrimination to gender identity and family care giving discrimination.

What are the key pieces of the Final Rule that will affect the Federal Contracting Community?

The items listed below were highlighted in the Final Rule’s Factsheet:

  • Clarifies that adverse treatment of an employee because of gender-stereotype assumptions relating to family caretaking responsibilities is discrimination.
  • Clarifies that flexible workplace arrangements for childcare must be available to men on the same basis that it is available to women.
  • Confirms that contractors must provide a variety of workplace accommodations, ranging from extra bathroom breaks to light-duty assignments, for women affected by pregnancy, childbirth, and related medical conditions comparable to the accommodations that contractors provide to other workers similar in their ability or inability to work, such as employees with disabilities or occupational injuries.
  • Further sets out disparate-treatment and disparate-impact approaches to the provisions for accommodations and leave, not limited to disparate-impact analyses on policies and procedures that deny such accommodations and/or leave.
  • Clarifies that contractors may not pay employees different wages, benefits, or any other forms of compensation on the basis of sex.
  • Confirms that contractors must provide equal benefits and equal contributions for male and female employees participating in fringe-benefit plans.
  • Addresses both quid pro quo and hostile-environment sexual harassment, and identifies as a best practice that contractors develop and implement procedures to ensure an environment in which all employees feel safe and welcomed, are treated fairly, and are not harassed on the basis of sex.
  • Clarifies that adverse treatment of employees because they do not conform to gender norms and expectations about their appearance, attire, or behavior, is unlawful sex discrimination.
  • Clarifies that discrimination against an individual because of her or his gender identity is unlawful sex discrimination.
  • Requires contractors to allow workers to use bathrooms, changing rooms, showers and similar facilities consistent with the gender they identify as.
  • Changes the “Sex Discrimination Guidelines” to regulations about “Discrimination on the Basis of Sex” to make clear that they have the force and effect of law.

The Final Rule goes into effect on August 15, 2016.

Additional information, including FAQs and a crosswalk of comparisons between the old guidelines and the new, can be viewed on the OFCCP website:

https://www.dol.gov/ofccp/sexdiscrimination.html

Obama Signs Two Executive Orders Aimed at Narrowing the Wage Gap

President Obama

President Obama Signed Two Executive Orders Pertaining Specifically to Federal Contractors

A consistent pattern has emerged in President Barack Obama’s presidency, a focus aimed at narrowing the wage gap between men and women. Tuesday, April 8, he kicked off Equal Pay Day by signing two executive orders pertaining specifically to federal contractors. He signed one executive order prohibiting federal contractors from taking action on employees that discuss their pay. The other order directs the Department of Labor (DOL) to propose within 120 days “a rule that would require federal contractors and subcontractors to submit to DOL summary data on the compensation paid their employees, including data by sex and race.” As many will recall, the President foreshadowed this motive nine days after his 2009 Presidential Inauguration with his first bill signed into law approving the Lilly Ledbetter Fair Pay Act.

Citing a well-used statistic that working women still earn only 77 cents for every dollar that a man earns, the second mentioned Executive Order also states that the pay gap is even greater for African-American women and Latinas. While encouraging the DOL to “rely on existing reporting frameworks” it is clear that the DOL will be paying closer attention to compensation practices of Federal Contractors, especially as it relates to those who are currently stated to be underpaid.  (http://www.whitehouse.gov/the-press-office/2014/04/08/presidential-memorandum-advancing-pay-equality-through-compensation-data)

Resource: New OFCCP FAQs on VEVRAA and Section 503 Final Rules

The OFCCP has posted new FAQs answering several of the questions the agency received about  the provisions in the recently published VEVRAA and Section 503  Final Rules.

To view the new OFCCP FAQ’s and other helpful content about VEVRAA and Section 503 Final Rules go to:

 Additional Resource from BCGi:

Download the webinar slides from “A Review of Revisions to Section 503 of the Rehabilitation Act and Section 4212 of the Vietnam Era Veteran’s Readjustment Assistance Act (VEVRAA)” by Dr. Patrick Nooren
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If you have any questions about VEVRAA or Section 503, please reach out to us at staff@biddle.com or 800-999-0438.