The 29th Annual National Conference for the Industry Liaison Group (ILG) was held July 25 – 29, 2011 in New Orleans, LA. This annual conference brings together members of the federal contracting community to discuss affirmative action and equal employment opportunity (EEO) issues and share information. 2011 proved to be an exciting and informative conference due to a flurry of change from OFCCP, with numerous regulatory items up for public comment and possible revision. DCI Consulting Group staff attended a variety of sessions during the conference. Session summaries and highlights can be found below:
Opening Ceremony: Speech from the Director of OFCCP - Patricia Shiu, OFCCP
You Can’t Un-Ring the Bell - David Fortney and Kathleen Raynsford, Fortney Scott and Jill Smith, WorkPlace HR
A New Day for Pay Discrimination Enforcement - Mickey Silberman, Jackson Lewis, LLP
Getting in Rhythm with OFCCP – Recent Significant Compliance Developments - John Fox, Fox Wang & Morgan
How Significant is Statistical Significance - A Practical Perspective - Alissa Horvitz and Joshua Roffman, Littler Mendelson
Regional Directors Panel - OFCCP Regional Directors: Melissa Speer, Michelle Hodge, Evelyn Teague, and Bill Smitherman
Academic Institutions as Federal Contractors – Exploring the Challenges in Compliance - Panel: Marilynn Schuyler, Schuyler Affirmative Action Practice; Christine Iijima Hall, Maricopa Community College; Judy Ferres, Boston College; and Lynette Chappell-Williams, Cornell University
Affirmative Action for People with Disabilities - George Kettner, Economic Systems, Inc.
Compensation Update - Pamela Coukos, Special Advisor, OFCCP
The Dangers of Social Media – How Employers Can avoid the Pitfalls of Social Networks - Lisa Harpe, Peopleclick Authoria and Christy Kiely, Hunton & Williams
Navigating the Landscape of OFCCP Compliance - Panel: David Cohen, Eric Dunleavy, Dan Biddle, David Fortney, Jon Geier, Joe Lakis, and Mickey Silberman
Opening Ceremony: Speech from the Director of OFCCP
Patricia Shiu, OFCCP
Patricia Shiu, OFCCP Director, opened the conference with a strong message to federal contractors that this administration intends to implement change, citing that the current administration was “No drama, Obama”. Director Shiu highlighted a variety of recent agency achievements, initiatives and goals, including:
OFCCP Achievements
OFCCP Initiatives and Goals
Emphasis was placed on pay discrimination issues, citing that women still earn 81 cents on the dollar as compared to men. Director Shiu also indicated that the OFCCP was still researching the use of a compensation data collection tool that would aid the agency in compensation enforcement. She also indicated that the agency would be issuing new guidance on compensation, in light of the proposed recession of the compensation guidelines. For more information, see DCI’s Blog article on the proposed compensation recession.
Shiu noteded that “discrimination is still a very real problem in our country,” and that affirmative action can no longer be defined by good faith efforts. Director Shiu ended her opening keynote address with sentiments that the OFCCP is working hard to encourage voluntary compliance efforts so that all workers can achieve the American dream, and encouraged a dialogue between the federal contract community and OFCCP to achieve equal employment opportunities for all workers.
You Can’t Un-Ring the Bell
David Fortney and Kathleen Raynsford, Fortney Scott and Jill Smith, WorkPlace HR
The Fortney Scott/WorkPlace HR team presented on how to “take the right actions at the right time” during OFCCP compliance reviews and investigations. After highlighting some recent OFCCP enforcement activities, such as the Astra Zeneca compensation settlement (for more information, visit DCI’s Blog article on the ruling), David Fortney and his colleagues Kathleen Raynesford and Jill Smith noted some of the changes related to the OFCCP’s Active Case Enforcement (“ACE”) directive, which replaced the Active Case Management (“ACM”) directive. Specifically, the ACE directive may result in more aggressive compliance reviews for contractors. The presenters also stressed that under ACE OFCCP will:
The presentation also focused on some pitfalls that contractors may fall into during an OFCCP compliance review, as well as some helpful tips to help navigate through the audit process. Some common compliance mishaps noted by the presenters included:
The team concluded with some helpful tips for contractors that could be used to aid compliance obligations in a time of heightened OFCCP enforcement. These included:
The Fortney Scott/Workplace HR Team encouraged contractors to take the new regulatory atmosphere of the OFCCP seriously when implementing compliance in organizations. The presentation was helpful to contractors, reiterating that if the appropriate actions were taken ahead of time, contractors would be better prepared during OFCCP audits and investigations.
A New Day for Pay Discrimination Enforcement
Mickey Silberman, Jackson Lewis, LLP
Mickey Silberman addressed the issue of compensation and the recent changes in OFCCP’s enforcement of pay discrimination. Silberman strongly emphasized that compensation is THE top priority for the agency. The shift in focus for the agency comes on the heels of President Obama’s promise to focus on pay equity enforcement and Secretary of Labor Hilda Solis’s goal of 20-40% of all OFCCP settlements to be focused on compensation. This is a major change from the past few years, where less than 15% of settlements focused on compensation. In 2008 there were no settlements involving alleged compensation discrimination and in 2009 there were only two. In 2010 there was a jump to 10 settlements involving compensation. Some key points from the presentation included:
Silberman concluded by encouraging contractors to continue to do proactive analyses even though the current climate is uncertain. It important to be as best prepared for the unknown as well as preventing private class action suits. Finally, Silberman emphasized that if you can’t explain it (i.e., differences in pay), then fix it and make sure you do it under attorney-client privilege!
Getting in Rhythm with OFCCP – Recent Significant Compliance Developments
John Fox, Fox Wang & Morgan
John Fox engaged contractors through his presentation titled “Getting in Rhythm with OFCCP – Recent Significant Compliance Developments.” While Mr. Fox’s overview addressed OFCCP’s recent activity related to compensation discrimination audit procedures reform, proposed regulations for Protected Veterans, and increased litigation, the majority of his presentation focused on some more up-to-date topics: the proposed new scheduling letter and the “hub-bub in Chicago.”
Per the process for obtaining OMB approval of an information collection, OFCCP published an ANPRM to request public comment on their proposed new scheduling letter. This comment period closed on July 11, 2011 with 18 submissions, a third of which were submitted by advocacy groups in favor of the letter as presented, sometimes even suggesting further obligations are required of contractors (e.g., reports of pay secrecy and arbitration polices). The number of comments was disappointing, according to Mr. Fox, especially in light of the 107 comments submitted for the proposed amendments of the Protected Veterans regulation. Mr. Fox urged contractors to take action on the issue by participating in the second, and final, comment period to be opened upon revisions made by OFCCP following any suggestions provided by OMB. He described the comment process as preparing evidence to take into trial; contractors have to take advantage of their right to shape rulemaking by presenting how it will affect their daily work.
In addition to voicing his concerns regarding the dearth of comments on the scheduling letter, Mr. Fox invited former Midwest Regional Director Sandy Zeigler and Deputy Shirley Thomas to speak on their recent retirement and the issue of the recalled scheduling letters sent to contractors on June 3, 2011. Ms. Zeigler expressed the desire to make it clear that the original scheduling letters were authorized for mailing and were not related to her decision to retire. Although there has been some concern by OFCCP that the original mass mailing of scheduling letters may have some implications for 4th Amendment rights.
How Significant is Statistical Significance- A Practical Perspective
Alissa Horvitz and Joshua Roffman, Littler Mendelson
This NILG presentation focused on analyses of personnel activity data (e.g., hiring, promotions, terminations, etc.) and some of the consequences of using statistical significance tests (i.e., the “2 standard deviation” Z test, Fisher’s exact test, etc.) as stand-alone evidence of meaningful disparity. The presenters emphasized that in a typical OFCCP audit many statistical significance tests will be conducted, particularly when analyses focus on gender, total minority, and racial/ethnic subgroups. The number of tests may increase substantially when analyses are conducted at both job group and job title levels. This general issue of multiple tests is referred to as the ‘multiple comparisons’ problem in the statistics literature. In these situations some tests of statistical significance will achieve the “2 standard deviation” threshold by chance alone since so many tests are being run, and it is important to consider that when interpreting the results of analyses across an entire affirmative action plan. The presenters also emphasized that:
Some of the main points from this session parallel recommendations from a 69-member Technical Advisory Committee (TAC) on adverse impact analysis that the Center for Corporate Equality (CCE) organized in 2009-2010. The TAC consisted of a wide variety of EEO experts including industrial-organizational psychologists, labor economists, plaintiff and defense attorneys, consultants, HR practitioners, and former OFCCP and EEOC officials.
Regional Directors Panel
OFCCP Regional Directors: Melissa Speer, Michelle Hodge, Evelyn Teague, and Bill Smitherman
All four of OFCCP’s Regional Directors gathered on stage at NILG this year to share regional updates and discuss common audit trends. Some of the noteworthy updates included:
Perhaps the most informative part of the session for contractors was the reoccurring non-compliance audit trends that each Regional Director noted across his/her region. These trends included:
Academic Institutions as Federal Contractors – Exploring the Challenges in Compliance
Panel: Marilynn Schuyler, Schuyler Affirmative Action Practice; Christine Iijima Hall, Maricopa Community College; Judy Ferres, Boston College; and Lynette Chappell-Williams, Cornell University
If you work in an academic environment than this panel session was a must attend at NILG. The idea for the session originated during an informal discussion at NILG 2010, when discussants agreed that little guidance is provided to address compliance issues that are unique to academic contractors. For example:
Following the informal discussion, ten employees from academic institutions developed a survey to collect information addressing how academic institutions comply with AAP regulations. The survey was launched in March 2011 and results were presented in this session. Some noteworthy survey results include:
Before the session concluded, questions and comments from the audience were addressed by the panelists. One reoccurring comment from the university community was the strong disagreement with OFCCP’s requirement that universities must conduct a visual check and provide gender and/or ethnicity/race information for those employees that do not volunteer the information. Next steps for the panelists include presenting results to Director Shiu.
Affirmative Action for People with Disabilities
George Kettner, Economic Systems, Inc.
Dr. Kettner of Economic Systems Inc. and his research team (Bobby Silverstein of Powers, Sutter and Verville, PC and Marc Bendick of Egan Economic Consultants, Inc.) were commissioned by the Department of Labor, Office of Disability Employment Policy (ODEP) to evaluate the feasibility of utilizing quantitative analyses and establishing numerical goals for employing people with disabilities. One of the driving factors behind implementing a quantitative approach is to provide the contractor community with clear objectives, consistency and transparency in enforcing the regulations.
Dr. Kettner recognized that there are many obstacles to observing and recording disability status that affect the ability to generate reliable estimates of disabled persons in the external workforce as well as in the contractors' workplace. For example, operationally defining what a disability is, identifying those disabilities that are transient as opposed to permanent, identifying optimal data sources,and acquiring accurate self-identification data were all identified as challenges.
Dr. Kettner proposed that the federal contractor community adopt a model similar to what is currently being used to estimate racial/ethnic groups and gender in the available workforce and employer organizations. Dr. Kettner stressed the linchpin for establishing goals was to encourage applicants and employees with disabilities to self-identify pre and post offer. Further, to increase confidence in the accuracy of the estimates, Dr. Kettner suggested federal contractors supplement data derived from the census long form with data derived from the American Community Survey (i.e. a short form of the census that is distributed every year and aggregated every five years).
Dr. Kettner’s sentiment that disabled individuals should not be excluded from employment is shared by federal contractors; however, there was disagreement in the audience regarding the feasibility of quantitative standards and the practicality of implementing Dr. Kettner’s approach. In particular, there was significant concern regarding violating the ADA . For example, a pre-offer identification would violate the ADA because it could be concluded that the employment decision was based on disability status and not qualifications; the number of people with disabilities in the organization would be explicitly displayed on the AAP report.
The Department of Labor has not updated the Disability regulations and has not publically endorsed Dr. Kettner’s position.
Compensation Update
Pamela Coukos, Special Advisor, OFCCP
This presentation focused on changes to OFCCPs’ policies related to compensation discrimination enforcement. This talk was of particular interest to many NILG attendees because Secretary of Labor Hilda Solis has promised that OFCCP will settle substantially more compensation cases in the next few years (20%-40% of all settlements), and OFCCP is planning to rescind their compensation standards and voluntary guidelines, which describe the types of employee groupings, statistical analyses, and anecdotal evidence necessary to identify compensation discrimination. Pamela Coukos is new to the agency and has been working with senior OFCCP staff and the Solicitor’s office (SOL) to develop new policies related to compensation. Some key points from this presentation and audience feedback included the following:
Coukos made the format very interactive, and took about 30 minutes of questions from the audience. She ended the session by reiterating that OFCCP’s new stance on compensation enforcement is a work in progress, and that the agency will continue to communicate new guidance as it becomes available, although what form that guidance will take is still unknown.
The Dangers of Social Media – How Employers Can avoid the Pitfalls of Social Networks
Lisa Harpe, Peopleclick Authoria and Christy Kiely, Hunton & Williams
Millions of people are actively engaging in social media. A survey conducted by Jobvite suggested that nearly 83% of Recruiters and Human Resource professionals surveyed were planning to use social media for recruiting job seekers in 2011. Dr. Lisa Harpe -- an Industrial Psychologist and Principal Consultant at Peoplefluent -- and Ms. Christy Kiely -- an attorney at Hunton & Williams – discussed the legal implications of using social media in employment decisions at the 2011 NILG conference.
Dr. Harpe indicated that many Recruiters and Human Resource professionals are turning to social networks (e.g. Facebook) and microblogs (e.g. Twitter) in making hiring, promotion, and termination decisions. However, Dr. Harpe cautioned that the apparent ease of searching for and reviewing the personal details of applicants’ or employees’ through social media can quickly give way to unwanted legal ramifications for an organization.
Dr. Harpe provided several examples of how Recruiters and HR professionals’ actions may violate equal employment law. These include:
Disparate treatment:
Disparate impact:
It is important to note that any information that is used to screen job seeker’s must be job related or consistent with business necessity. Additionally, once recruiters and HR Professionals begin evaluating an individual’s qualifications via social media they are responsible for accurately dispositioning the applicant according to the Internet Applicant regulation and record keeping requirements.
Dr. Harpe indicated that using social media in hiring may make federal contractors more vulnerable to record keeping violations. For example, if social media is used to evaluate applicants, the web link that was the source of the applicant’s information would have to be saved in a manual log. A manual log is generally more difficult to maintain and web links do not have a permanent shelf life. Hence, during an audit the federal contractor could find that their database has not been properly populated and/or that the web link that was stored as a source of the candidate information is no longer viable. In either of these circumstances, the federal contractor could be penalized by an enforcement agency for not maintaining accurate records.
The negative impact of social media on the employment setting is not limited to identifying suitable candidates for employment. Ms. Keily discussed how employer’s and employees’ actions on social media may result in undesirable outcomes for the organization (i.e. negative publicity for the organization, the publication of confidential information, retaliation, etc.) and, in some circumstances, legal proceedings.
Ms. Keily also reminded the federal contractor community that employers are not entitled to look at applicant/employee information merely because it has been posted on the Internet. In addition, certain forms of speech and individual actions are protected under the law (i.e. commenting on work conditions, organizing other employees to change the conditions of the workplace, etc.).
Both Dr. Harpe and Ms. Keily recommended that federal contractors develop and implement social media policies to assist in guiding employee behavior and to protect the organization from legal vulnerability. Recent estimates suggest that 45% of organizations do not have a social media policy (HCCA/SSCE 2011 survey). In addition, Ms. Keily recommended that employers maintain current and objective job descriptions that highlight the employer’s expectation of the employee. Job descriptions that are current and based on objective standards can be helpful in defending an organization against an employee if the organization can make a connection between the employee’s behavior on a social medial site and the expectations established in the job description.
In summary, regardless of how your organization plans to use social media in the employment arena there are a few guiding principles that may reduce your organizations legal exposure and assist your organization with EEO regulatory compliance:
Dr. Harpe suggested that the best approach to avoiding legal conflicts that are the result of social media… is to avoid using social media when evaluating current and prospective employees. However, if your organization is committed to using social media in the employment context, one guaranteed “best practice” is to make sure your organization is complying with equal employment principles outlined in federal and state laws.
Navigating the Landscape of OFCCP Compliance
Panel: David Cohen, Eric Dunleavy, Dan Biddle, David Fortney, Jon Geier, Joe Lakis, and Mickey Silberman
A panel discussion titled “Navigating the Landscape of OFCCP Compliance” was moderated by Eric Dunleavy of DCI Consulting Group. The panel was comprised of Dan Biddle from Biddle Consulting Group, David Cohen from DCI Consulting Group, David Fortney from Fortney and Scott, Jon Geier from Paul Hastings, Joe Lakis from EEAC, and Mickey Silberman from Jackson Lewis. In an effort to ensure equal participation and provide creative, impactful, and brief presentations, each of the panelists had 5 minutes to present 10 slides and each slide auto-progressed every thirty seconds with or without the panelist. Index cards were distributed to collect audience questions while the panelists presented their slides. After the presentations, Dr. Dunleavy asked some initial follow-up questions and then asked audience questions for the panel to answer. The following section briefly summarizes each panelist’s presentation.
Proposed Changes to the OFCCP Scheduling Letter - Jon Geier
Jon Geier presented on the proposed changes to the current scheduling letter, which included a “Top Ten” list of changes to be aware of. They were as follows:
VEVRAA Regs: The Proposed Changes – Mickey Silberman
Mickey Silberman presented on the proposed changes to the VEVRAA Regulations – with an emphasis on how these would “change the world” for the contracting community. Mr. Silberman commented on the political context of the VEVRAA proposed changes, stating that this initiative appears to be a result of priorities in the White House. The most significant changes for contractors, according to Mr. Silberman, will be seen in the types and levels of burdens placed on them by the proposed amendments to VEVRAA. He reported employers have been expressing the following notions:
Regardless of these concerns, OFCCP has announced that it will NOT rescind the proposed amendments to VEVRAA.
OFCCP and Compensation - David Cohen
David Cohen presented on compensation, focusing on a variety of recent OFCCP activities related to compensation analysis. These included:
In closing, Mr. Cohen recommended that contractors continue to conduct proactive analyses using multiple regression analysis and where statistically significant differences are found, contractors should conduct additional analysis, research the causes of the differences, and make salary adjustments when justified.
Testing and Adverse Impact – Dan Biddle
Dan Biddle presented on the topics of test enforcement and litigation and adverse impact, as well as best practices for both. Dr. Biddle provided some background information about testing, adverse impact, and what the law says about both. He also reviewed the OFCCP “testing directive” from 2004 and the investigation process, which requires a compliance officer to conduct an adverse impact analysis and obtain a validity study when impact exists. Some highlights included:
An Overview of OFCCP Trends- Joe Lakis
Joe Lakis provided an overview of OFCCP trends, focusing on changes over the last 15 years for OFCCP staffing, audits, complaint investigations, financial settlements, and conciliations agreements. Enforcement trends and a look at upcoming items were also included. Trends included:
Mr. Lakis called the current enforcement plan full-scale and aggressive. He also stressed that compliance reviews are no longer contingent on findings during the desk audit phase. This is due in large to the recent Active Case Enforcement (ACE) directive that replaced the Active Case Management (ACM) from 2003. There is an increased emphasis on traditional affirmative action compliance (i.e., AA for protected veterans and persons with disabilities) and focus on internal auditing obligations. Mr. Lakis noted there has been attention placed on individual, as well as systemic discrimination. We have seen a closer inspections of personnel files, increased number of interviews (as a result of increase in full-scale audits), and requests for explanation for small differences in compensation for few employees.
Additionally, as emphasized during this panel discussion and the rest of the conference, Mr. Lakis closed his presentation there is a lot of activity currently happening and approaching in the coming year. He reminded everyone of the regulatory items that are coming available over the next year:
Recent ALJ Decisions, Complaints, CDs, and CAs – David Fortney
David Fortney presented on recent Administrative Law Judge (ALJ) rulings, consent decrees, complaints, and conciliation agreements, all a part of the “hierarchy” of OFCCP claims and resolutions.
Q&A session
Eric Dunleavy, the moderator of the session addressed the panel with a series of pre-determined questions and then opened up for questions from the audience. Questions from the moderator touched on issues addresses by the panelists, including: the scheduling letter, VEVRAA, compensation, testing, audits, and recent court cases. Questions from the audience tended to focus on compensation, individuals with disabilities, protected veterans, and general items. The majority of audience and panel questions focused on the many changes coming out of the agency. Audience members expressed concern about what the next five years might bring and how to best prepare and manage risk, as well as anxiety about what to do to in the interim before changes become official. The panel emphasized that the contractor community should continue to be proactive during the interim, continue developing plans, analyzing personnel activities and compensation, and to be sure to focus on recruitment efforts and outreach to individuals with a disability and veterans.
by David Cohen, Eric Dunleavy, Joanna Colosimo, Marcelle Clavette, Amanda Shapiro, Jana Moberg, and Eileen Curtayne, DCI Consulting Group