In the Fiscal Year 2018 Congressional Budget Justification for the Office of Federal Contract Compliance Programs (OFCCP) in the U.S. Department of Labor, the Trump administration has proposed merging the OFCCP into the Equal Employment Opportunity Commission (EEOC). This proposal is not new and was reportedly considered in 1978 during the Carter administration. In 2017, however, it is more likely to succeed, given the fact that the executive branch, the House, and the Senate are controlled by the same party.
The OFCCP enforces Executive Order 11246, signed by President Lyndon B. Johnson in 1965, as well as Section 503 of the Rehabilitation Act of 1973 and Section 4212 of the Vietnam Era Veterans’ Readjustment Assistance Act of 1974. These laws require nondiscrimination and affirmative action by companies doing business with the federal government. They collectively prohibit discrimination based on race, color, religion, national origin, sex, disability, veterans’ status, gender identity, and sexual orientation. The federal contractor universe within OFCCP’s jurisdiction covers approximately one-quarter of the civilian labor force.
Merging the OFCCP and the EEOC was initially proposed in a document published by the conservative think tank The Heritage Foundation, which cited as its rationale that a merger would promote government efficiency. The White House used the same reasoning in advancing the merger in its budget justification. To facilitate the process, the administration proposed reducing the OFCCP’s budget from $104 million in 2016 to $88 million in 2018, which would effectively cut the office’s staff from 615 to 440.
According to the administration, the purpose of the budget proposal was “to promote greater policy coordination, management efficiency, and cost-effectiveness.” In line with this reasoning, the White House stated: “Consistent with the president’s direction to agencies to develop comprehensive plans to reform and reorganize, the budget proposes to lay the groundwork to merge the OFCCP into the EEOC by the end of [fiscal year] 2018,” adding that the merger would purportedly “benefit employers, workers, and the public by consolidating the oversight of federal equal employment opportunity under one roof.”
Interestingly, both employer advocates and the civil rights community have opposed the proposed merger of the two equal employment agencies. Leading the contractor community was the U.S. Chamber of Commerce and the Institute for Workplace Equality. Among the equal employment opportunity associations that oppose the proposal are the American Association for Access, Equity, and Diversity (AAAED) and the National Industry Liaison Group. The National Association of Diversity Officers in Higher Education (NADOHE) joined AAAED in releasing a statement. The Leadership Conference on Civil and Human Rights, signing on behalf of 73 organizations, led the civil rights community in strongly opposing the administration’s proposal.
In its letter in opposition to the proposal, AAAED reminded the U.S. Secretary of Labor and the director of the Office of Management and Budget of the distinctive bipartisan history of the OFCCP as a creature of the federal contracting function. Presidential orders mandating equal employment opportunity date back to 1941, when President Franklin D. Roosevelt ordered the integration of the war industry after pressure from the Brotherhood of Sleeping Car Porters, an African American labor organization. During the Eisenhower administration, Vice President Richard M. Nixon chaired the President’s Committee on Government Contracts and penned this memorable passage:
Overt discrimination, in the sense that an employer actually refuses to hire solely because of race, religion, color, or national origin, is not as prevalent as is generally believed. To a greater degree, the indifference of employers to establishing a positive policy of nondiscrimination hinders qualified applicants and employees from being hired and promoted on the basis of equality.
Nixon’s positive policy of non-discrimination became President John F. Kennedy’s affirmative action program when Kennedy incorporated the concept into Executive Order 10925 in 1961. Later that year, federal contractors voluntarily joined Kennedy’s “Plans for Progress,” which called for “continuous, systematic, and vigorous action to open new job opportunities to members of minority groups.” In 1963, under Johnson, 115 companies and institutions of higher education were participating in the plans.
Johnson signed Executive Order 11246 in 1965, and in 1967, women were added as a protected group. In 2014, President Barack Obama amended the executive order to include gender identity and sexual orientation.
Unlike the EEOC, which was created by the Civil Rights Act of 1964 as a semi-independent agency, the OFCCP is an integral part of the federal contracting community. Companies.— including institutions of higher education — that provide supplies and services, or that perform construction services in an amount designated by the federal government, must comply with the Equal Opportunity clause in each contract. To enforce this clause, the OFCCP conducts compliance evaluations and reviews of contractors, desk audits, pre-award reviews, and other actions to monitor compliance. The ultimate sanction is debarment. If debarred, a contractor is prohibited from receiving additional federal contracts unless the company is reinstated as a contractor after agreeing to terms to become compliant. Debarment is an extreme and expensive sanction and is not often imposed. Annually, the federal government awards approximately $400 billion in federal contracts, so losing one through debarment can be expensive.
Unlike the EEOC, through which a complainant often receives a Right to Sue Letter and may proceed to federal court to seek redress, the victim of discrimination under an OFCCP review has no personal right to sue. He or she may receive “make-whole” relief if the OFCCP finds that the contractor has discriminated against that person by failing to hire or promote him or her based on race, gender, or another prohibited basis. Such relief restores the person to his or her employment status prior to the discriminatory act. Additional relief may include back pay with interest, accrued pension benefits, or other forms of compensation.
The OFCCP represents the interests of the government in its awarding and administration of contracts. More significantly, its focus is systemic, and it reviews a contractor for patterns and practices of discrimination, as well as its efforts to promote equal employment opportunity. The EEOC, on the other hand, is primarily complaint driven and relies on charges to be filed to trigger enforcement actions.
The AAAED and other organizations have argued that merging the EEOC and the OFCCP is far from a simple matter and is the “antithesis of efficiency.” Their fundamental purposes are different, as are their administrative enforcement processes. As a semi-independent agency, the EEOC would be a poor steward of the government’s contracting responsibilities. Moreover, it would have to create an entirely different investigative and enforcement mechanism to replicate the current processes of the OFCCP.
Congressional appropriations committees are considering the president’s proposal at this time as part of the annual budget process.●
Shirley J. Wilcher, JD, CAAP, is the executive director of the American Association for Access, Equity, and Diversity. She served as director of the OFCCP from 1994 to 2001. Wilcher is also a member of the INSIGHT Into Diversity Editorial Board. The AAAED is a partner of INSIGHT Into Diversity.