DOL Proposes to Reduce Evidentiary Standards and Transparency for Discrimination Claims

A proposed rule by the Department of Labor would roll back Trump-era safeguards for federal contractors and lift restrictions on the Office of Federal Contract Compliance Program’s broad enforcement discretion, according to OFCCP Director Jenny Yang.

Background: Current rules, published on December 10, 2020, established important procedural and substantive requirements before OFCCP can issue discrimination findings. The agency is currently required to disclose to federal contractors during their affirmative action audits the qualitative (i.e., testimony and documents) and quantitative (i.e., data analysis that is “practically significant”) evidentiary support for any preliminary finding of discrimination. Pre-determination notices must also be approved by the OFCCP Director before issuance.

The proposed rule would, among other things:

• Eliminate evidentiary requirements for the issuance of pre-determination notices (PDNs) and notices of violations (NOVs);
  
  
• Eliminate the requirement that PDNs be approved by the OFCCP Director before issuance;
  
  
• Permit OFCCP to issue NOVs for violations not included in PDNs;
  
  
• Reduce the time for contractors to respond to a PDN from 30 to 15 days; and
  
  
• Clarify that Show Cause Notices may be issued without first issuing a PDN or NOV, when a contractor has not given OFCCP the information it has requested.

Takeaways: The proposed rule is the latest sign OFCCP is ramping up its enforcement efforts and follows the agency’s new directive that it would more closely scrutinize internal pay equity audits. Federal contractors should start preparing for lengthy information requests, especially regarding their internal pay analyses, without much explanation from OFCCP. Contractors can also expect to face more findings of discrimination with less transparency and consistency regarding discrimination claims across the OFCCP’s district and regional offices.