Brief review of changes in 2014 and expected proposals for 2015
2014 will be known as a year of significant regulatory changes. Federal contractors and subcontractors have been busy updating systems, processes and policies due to these revisions. Some were expected as they were on Director Patricia Shiu’s agenda to modernize outdated regulations. However, unexpected changes came from President Obama issuing Executive Orders directing the Department of Labor to publish implementing regulations. Here’s a recap of what finalized in 2014 and what’s still on the horizon for 2015.
Updated Veteran and Disability Regulations – Final Rule Stage On September 24, 2013, the OFCCP published Final Rules that made changes to the regulations implementing Section 503 of the Rehabilitation Act of 1973 and Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA). The regulations became effective on March 24, 2014. However, contractors with a written affirmative action program (AAP) already in place on the effective date have additional time to come into compliance with the AAP requirements. The regulations specific to veterans and individuals with disabilities now closely resemble the regulations for women and minorities. For instance, contractors are now required to solicit disability and veteran status of applicants just as they solicit gender and race.
Revised Scheduling Letter and Itemized Listing On September 30, 2014, the OFCCP published a Notice in the Federal Register announcing a newly approved Scheduling Letter and Itemized Listing. The Scheduling Letter and Itemized Listing were effective immediately and have been sent out with scheduled compliance evaluations since October 15, 2014. In large part, the revised Scheduling Letter was needed in order to align with the aforementioned veteran and disability requirements.
Federal Contractor Veterans' Employment Report VETS-4212 – Final Rule Stage On September 25, 2014, the U.S. Department of Labor's Veterans' Employment and Training Service ("VETS") published its Final Rule that reduces reporting requirements for federal contractors and subcontractors on their annual report. The VETS-4212 Report requires contractors to report protected veteran information in the aggregate, rather than for each category of veterans protected under the statue. The Final Rule became effective October 27, 2014 and contractors will have to comply with the annual report filed in 2015.
Establishing a Minimum Wage for Contractors – Final Rule Stage On October 1, 2014, U.S. Secretary of Labor, Thomas E. Perez, announced the Final Rule which raised the minimum wage for workers on Federal service and construction contracts to $10.10 per hour. The Final Rule implements Executive Order 13658, which was announced by President Obama on February 12, 2014. The Final Rule was published on October 7, 2014 and became effective on December 8, 2014. Every covered worker performing work on or in connection with a covered contract must be paid no less than $10.10 per hour beginning January 1, 2015. Beginning January 1, 2016, and annually thereafter, this amount may be increased to an amount determined by the Secretary of Labor based on inflation.
Implementation of Executive Order 13672 Prohibiting Discrimination Based on Sexual Orientation and Gender Identity by Contractors and Subcontractors – Final Rule Stage On December 9, 2014, the OFCCP published its Final Rule to revise the regulations implementing Executive Order 11246 (“EO 11246”), in accordance with Executive Order 13672 (“EO 13672”). EO 13672 amends EO 11246 by adding sexual orientation and gender identity to the prohibited bases of discrimination. These regulations are effective April 8, 2015. Contractors need to update their Equal Opportunity Policy statements with the new protected categories, including but not limited to: job posting taglines, posted policy statements, and purchase order language.
WHAT’S EXPECTED TO FINALIZE IN 2015:
Compensation Data Collection – Proposed Rule Stage The Notice of Proposed Rulemaking (NPRM), "Government Contractors, Requirement to Report Summary Data on Employee Compensation” was published in the Federal Register on August 8, 2014 for its proposed rule that would require Federal contractors and subcontractors to submit an annual Equal Pay Report on employee compensation to the agency. All comments were originally due by November 6, 2014; however, on October 31, 2014, the OFCCP announced a 60-day extension of the comment period to January 5, 2015. The Final Rule is expected in August, 2015.
Prohibitions Against Pay Secrecy Policies and Actions – Proposed Rule Stage On September 17, 2014, the OFCCP published its proposing rule to implement Executive Order 13665 ("EO 13665"), signed by President Obama on April 8, 2014. EO 13665 amends EO 11246 by adding that discrimination based on the inquiry, discussion, or disclosure of pay is also prohibited. The comment period ended on December 16, 2014 and the Final Rule is expected in September, 2015.
WHAT’S EXPECTED TO PUBLISH FOR COMMENT IN 2015:
Sex Discrimination Guidelines – Proposed Rule Stage OFCCP submitted a Notice of Proposed Rulemaking (NPRM) to OMB on November 21, 2014. Once OMB reviews, it will be placed on the federal register for notice and comment. The proposal is to revise the current sex discrimination regulations (part 60-20) to reflect the current state of the law.
Construction Contractors' Affirmative Action Requirements – Proposed Rule Stage The agency expects this NPRM to revise its construction contractor regulations by removing outdated regulatory provisions, proposing a new method for establishing affirmative action goals, and proposing other revisions to the affirmative action requirements that reflect the realities of the labor market and employment practices in the construction industry today. In December 2012 the agency stated that it expected to publish the NPRM in October 2013, and in December 2013 the agency stated it expected to publish this NPRM in April 2014. OFCCP’s Fall Regulatory Agenda timetable states the NPRM is to be published September 2015.
Fair Pay and Safe Workplaces On July 31, 2014, President Obama signed Executive Order 13673, "Fair Pay and Safe Workplaces". The Executive Order: 1) will govern new Federal procurement contracts valued at more than $500,000, providing information on companies' compliance with Federal labor laws for agencies; and 2) is expected to be implemented on new contracts in stages, on a prioritized basis, during 2016.
Check out OutSolve’s blog archives for further details on any of these Executive Orders or Final Rules.