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In her presentation at the 2021 NILG National Conference, OFCCP Director Yang indicated the general direction of the Agency under the new administration. Significant change may await us.

Director Jenny Yang announced that Michelle Hodge, formerly Mid-Atlantic RD, will become OFCCP Deputy Director. Michelle Hodge brings a wealth of experience to the position given her prior role as the Regional Director for the OFCCP’s Mid-Atlantic Region.

Director Yang also welcomed Maya Raghu to the OFCCP as its Deputy Director of Policy. Director Yang noted that Ms. Raghu will focus on pay equity. Ms. Raghu was Senior Counsel at the National Women’s Law Center, the group that sued the Office of Management and Budget (OMB) to force the collection of EEO-1 Component 2 pay information. She has written in no uncertain terms that she disagrees with the 2020 Oracle decision, in which an Administrative Law Judge found that the OFCCP’s pay analysis procedures violate Title VII legal standards. Ms. Raghu’s appointment is one more reason to follow the development of OFCCP’s pay review practices with care.

Director Yang’s action items include reviewing how federal contractors are selected for audit, in order “to identify industries with higher rates of noncompliance”. Director Yang also mentioned modernizing the ‘supply and service’ regulation (the race and gender affirmative action requirements set out in 41 CFR Chapter 60, pursuant to Executive Order 11246) to ‘better align with the modern workforce’. The Agency is considering updates the following updates:

  • Goal setting by race/ethnicity subgroup (as opposed to the current comparison of Whites to a single utilization goal for all minorities, the proposed subgroup analysis will radically expand the number of analyses you must perform).
  • Detail on how to report non-binary gender self-identification (the OFCCP has a rather vague FAQ on the voluntary identification of individuals who identify as other than male or female. Currently the Agency requires only male/female reporting).

Director Yang also spoke of finding “alternatives to the establishment-based approach” to Affirmative Action Plans (AAPs). This could lead to very significant changes in Agency practice.

Today most AAPs report on individual ‘brick and mortar’ work locations. These AAPs do not commonly reflect a federal contractor’s business organization. ‘Functional Affirmative Action Plans’ (FAAPs) report location-spanning business organizations, but use of FAAPs pose problems for contractors. All organizational changes must be reported to the Agency in ‘real time’. Given the speed at which some companies reorganize, this can be hard to keep up with. Also, the large employee populations commonly reported in FAAPs can make small differences between groups statistically significant. This ‘large numbers problem’ can, unfortunately, lead to contractors who maintain FAAPs being required to justify their treatment of large numbers of employees.

It will be interesting to see if the OFCCP can meet Director Yang’s goal of “integrating the objectives of OFCCP compliance requirements with broader Diversity & Inclusion efforts” by finding a middle ground between the two forms of current review.

In her discussion of possible supply and service program changes, Director Yang stated that her objective is to “reduce unnecessary burden on contractors while ensuring how to address indicators of discrimination.” Such a balance would be greatly appreciated. Having a robust conversation between the Agency and the contractor community would be a good first step for ensuring that Director Yang’s intentions become practice.

Author

Paul McGovern
Managing Partner
Praxis Compliance

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