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Potential Cuts to DOL Budget and Possible Merger of EEOC and OFCCP Top Industry News Circuit

Scott Kushner

Budget submission from POTUS creating lots of headlines

A first glance at the 2018 proposed budget sent shockwaves through the federal contractor and Affirmative Action community.

But, it’s merely the first step on a long path, as the Trump Administration’s proposal begins its slow sojourn toward becoming law.

The most attention-grabbing section of the proposed legislation is a recommendation to merge the EEOC and OFCCP, in an attempt to limit redundancy in the Department of Labor.

“The 2018 Budget proposes merging OFCCP into the Equal Employment Opportunity Commission (EEOC), creating one agency to combat employment discrimination. OFCCP and EEOC will work collaboratively to coordinate this transition to the EEOC by the end of FY 2018. This builds on the existing tradition of operational coordination between the two agencies. The transition of OFCCP and integration of these two agencies will reduce operational redundancies, promote efficiencies, improve services to citizens, and strengthen civil rights enforcement.”

The proposed budget would reduce OFCCP’s current budget by $17 million – from $105 million to $88 million - cutting the number of full time employees from 581 to 440. Meanwhile, the EEOC’s budget would remain largely unchanged.

There’s also a potential change in enforcement direction, moving away from applicant and hire issues to focus on pay and construction. During the upcoming transition period of FY 2018 (October 1, 2017 – September 30, 2018), the proposal directs the OFCCP to:

  1. Prioritize “those evaluations with evidence of systemic pay issues;” and
  2. Provide “intensive compliance assistance” to contractors engaged in large-scale construction projects.

The EEOC and OFFCP merger germinated in a conservative think-thank, The Heritage Foundation, which pitched it as an attempt to limit federal spending and crack down on unnecessary overlapping function. And, based on the first run of the budget, it appears the Trump Administration is listening.

However, these ideas have not stood up to the awaiting political realities.

While the OFFCP is far from the top of mind in regards to this overall budget proposal, hot-button items like shrinking support for health care (an $800 billion Medicaid cut) and tightening federal services ($250 billion cut over 10 years to low-income assistance programs) will cause stern consternation for even the most Trump-friendly congressmen and senators.

Political analysts from both sides of the aisle have already voiced opposition and Texas Sen. John Cornyn, the second ranking Republican in the Senate, called the proposal “Dead on arrival”. Arizona Senator John McCain used the same “D.O.A” phrase due to inadequate defense earmarks. And even if the OFCCP-EEOC merger makes it through the political bit-by-bit dissection looming on the horizon, there are legislative hurdles to making the merger work at all.

According to Employment Law Daily:

“The EEOC doesn’t have statutory authority to enforce Executive Order (EO) 11246, VEVRAA or Section 503 of the Rehab Act. While the non-discrimination requirements of the laws enforced by the OFCCP largely overlap with the those of the laws enforced by the EEOC, whether the affirmative action areas that are unique to OFCCP enforcement will stay within the DOL, be transferred to the EEOC, or be eliminated entirely, is still an issue, attorney John Fox explained. Any of these options would require some Congressional action as well as the President amending EO 11246, he pointed out. Currently, the EEOC does not have the authority to do many things that the OFCCP has, including bringing administrative actions to debar federal contractors.”

For now, the budget proposal is nothing more than a proposal. And while it may reveal the administration’s eventual goals for the agencies inside the DOL, it doesn’t necessarily reflect an incoming reality.

It’s just the first step on a long path.

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