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New World Order for Government Contractors
By: Charles McClellan

On March 27, 2017, President Trump took two actions to roll back a controversial Obama-era requirement for government contractors. 

First, the President signed an Executive Order revoking President Obama’s Fair Pay and Safe Workplaces Executive Order (Executive Order 13673, as amended by Executive Orders 13673 and 13738). This controversial executive order had required, among other things, federal contractors to (1) disclose prior violations of federal and state employment and labor laws in solicitations for certain government contracts and every six months during the existence of the contract (the “blacklisting” order) and (2) provide certain pay-related information to employees and independent contractors (the “paycheck transparency” order).  
In conjunction with that Executive Order, the President also signed into law H.J. Resolution 37. This measure—authorized by the rarely used Congressional Review Act, which allows Congress to review and overrule a regulation adopted by a government agency within the last 60 legislative days (in this case dating back to May 2016), prohibiting the agency from issuing in the future a rule that is substantially the same—overruled the final agency regulations designed to implement the Fair Pay and Safe Workplaces Executive Order. A federal judge already had issued a temporary restraining order last fall, blocking implementation of the blacklisting portion of the order, but allowing the paycheck transparency rules to take effect. This resolution now negates the entire set of regulations and bars the government from adopting substantially the same regulations again in the future, unless expressly authorized by an act of Congress.
This action marks President      Continue Reading...
OFCCP Publishes Final Pay Transparency Regulations for Government Contractors
By: Charles McClellan

The OFCCP recently published final Pay Transparency regulations for government contractors. Mandated by Executive Order, the new regulations protect applicants and employees from adverse treatment for sharing pay information, establish employer defenses to pay-transparency discrimination claims, and impose publication requirements on contractors. 

Regulations Prohibit Pay-Transparency Discrimination
The regulations add a new anti-discrimination provision to the Equal Opportunity Clause that will become part of every government contract and subcontract. That provision states:
The contractor will not discharge or in any other manner discriminate against any employee or applicant for employment because such employee or applicant has inquired about, discussed, or disclosed the compensation of the employee or applicant or another employee or applicant.
“Compensation” is broadly defined to include not only salary and wages, but also overtime pay and shift differentials; bonuses, commissions, and profit sharing; vacation, holiday, insurance, retirement and other benefits; and stock options and awards. Unlike the NLRB’s recent pay-transparency rules, this nondiscrimination provision applies to all employees, including supervisors and managers.
In pursuing pay-transparency discrimination claims, the OFCCP will apply the “a motivating factor” standard. This means the OFCCP can prove discrimination if pay transparency was a motivating factor in an adverse employment decision, even if other legitimate grounds also animated the contractor’s decision. The OFCCP also warns that, in some cases, it will apply the McDonnell Douglas burden-shifting approach to show that an employer’s proffered justification for its actions is a pretext for discrimination. Unlike Title VII or other discrimination claims, only the OFCCP—not individual employees—can      Continue Reading...
Franchisors, Parent and Sibling Entities, and Employers Who Use a Staffing Agency, Subcontractor, or Vendor: Beware! You (Perhaps) Just Became a "Joint Employer"
By: Charles McClellan

A new ruling by the National Labor Relations Board (NLRB) threatens to destroy the line separating corporate entities and the corresponding limitations on liability by dramatically expanding the definition of “joint employer” in the labor context.

For more than three decades, the NLRB had applied the same joint-employer standard: where one employer exercises sufficient direct control over the terms and conditions of another’s employees, they are “joint employers.” This means that both employers have collective bargaining obligations with respect to the joint employees, face potential liability for unfair labor practices or breach of a collective bargaining agreement, and are subject to economic protest activity, such as strikes, boycotts, and picketing.
Background – Union Alleges that Company Is Joint Employer with Its Staffing Agency
A Teamsters union sought to organize the employees of a recycling center in California. The workers were employed by a staffing agency, Leadpoint Business Services, and worked on the premises and alongside employees of Browning-Ferris Industries (BFI). The union argued that BFI was a joint-employer, but the Regional Director rejected that argument under existing precedent. While BFI had contractual rights to control certain aspects of the employment relationship, it had not actually exercised those rights, and its control was so indirect, limited, and routine, that BFI could not be considered a joint employer.
On appeal, the NLRB, in a 3-2 decision, abandoned the current joint employer test in favor of a much broader, union-friendly test, and concluded that BFI and Leadpoint were joint employers.
NLRB’s New Test – It’s All About      Continue Reading...
Government Contractors & Other Large Employers: It’s That Quarter Again!
By: Charles McClellan

By the end of the third quarter of each year (September 30), the government requires certain federal contractors and other large employers to disclose demographic data about their workforce. Are you ready to file? 

What reports have to be filed? 

The federal government mandates that certain employers disclose the demographics of their workforce in two different annual reports: 

  • The U.S. Equal Employment Opportunity Commission (EEOC) and the Office of Federal Contractor Compliance Programs (OFCCP) require an EEO-1 Employer Information Report, which summarizes gender and race/ethnicity demographics.
  • The U.S. Department of Labor Veteran’s Employment and Training service and the OFCCP require a VETS-4212 Veterans’ Employment Report (which this year replaces the prior VETS-100 and VETS-100A reports), which summarizes protected veteran demographics. 
Who has to file?
The EEO-1 report must be completed by:
  • Employers with 100 or more employees (including smaller affiliate companies where the entire enterprise employs 100 or more employees) who are also subject to Title VII of the Civil Rights Act of 1964.
  • Federal contractors with a prime contract or first-tier subcontract amounting to $50,000 or more and with 50 or more employees. 
By contrast the VETS-4212 applies to all federal contractors and subcontractors with a contract or subcontract in the amount of $100,000 or more. 
What has to be reported?
The EEO-1 and VETS-4212 reports both present a snapshot of the demographics of your workforce at a single point in time. You may use the data from any pay period during the quarter      Continue Reading...
OFCCP Proposes Overhaul of Sex-Discrimination Regulations
By: Charles McClellan

The Department of Labor’s Office of Federal Contract Compliance Program (OFCCP), which regulates companies that contract or sub-contract to do business with the federal government, issued proposed rules last week that would replace the existing sex-discrimination guidelines for contractors. The proposed rules purport to account for changes in sex-discrimination laws that have occurred since the rules were first adopted in 1970 and to address current workplace issues.

Among other changes, the proposed regulations: 

·         Shift emphasis from overt discriminatory practices that no longer exist (such as gender-segregated job advertisements or “male-only” hiring policies) to more subtle forms of sex-based discrimination, including sexual harassment, sex-based job segregation and classification, and discrimination based on gender-based stereotypes related to family caretaking responsibilities or gender norms.
·         Expand protections to pregnant applicants and employees, consistent with the 1978 Pregnancy Discrimination Act, by, among other things, prohibiting employers from forcing pregnant employees to take leave or limiting their job duties and by obligating employers to provide pregnant employees reasonable accommodations and, in some situations, health or disability insurance.
·         Clarify that harassment or discrimination based on gender identity constitutes unlawful sex-discrimination.
·         Broadly define and explicitly prohibit sex-discrimination in compensation and fringe benefits.
Interested parties have until March 31, 2015 to comment on      Continue Reading...

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