22 June 2017

Two Minute Legal Update: Merger of EEOC and OFCCP Ahead?

You’ve probably read about the proposed merger of the Labor Department’s OFCCP into the Equal Employment Opportunity Commission.  This has been touted by the White House as a budget trimming step to consolidate overlapping federal agency functions.  The theory is that OFCCP and EEOC perform duplicate roles, so they should become one agency.

Now, the difficulty with this proposal is that EEOC generally investigates individual discrimination complaints triggered by filing of charges. In contrast, OFCCP investigates affirmative action and systemic discrimination – generally in hiring and pay – by selecting federal contractor establishments for multi-year “wall-to-wall” investigations.

In addition, OFCCP’s authority is an Executive Order, a portion of the Rehabilitation Act, and veterans statute.  EEOC currently has no jurisdiction over these laws or regulations, nor affirmative action expertise.  President Trump could amend the Executive Order on his own, but these other two laws require Congressional action.

There’s been a groundswell of opposition from some ‘strange bedfellows’ – and not just political factions.  Federal contractors, business groups, lawmakers, organized labor and over 70 special interest groups all argue that OFCCP and EEOC have distinct functions and purpose and should remain separate.

There’s also a question about whether significant budget savings can actually be realized, or if this is merely a line item transfer from DOL to the EEOC’s budget.  In any event, even if the merger goes ahead, it wouldn’t happen until Fiscal 2019 at the earliest which starts Oct. 1, 2018.  What does this mean for you?  Well, nothing right now.  While OFCCP may be a bit distracted as the merger whirlwinds blow, it’s business as usual for at least another year or two.

Meanwhile, as you can see, OFCCP continues to forge ahead investigating contractors and has wrangled some very high dollar settlements in 2017 under the new Trump administration.

  • —June 2017 – KPMG, LLP ($420,000)
  • —May 2017 – Nebraska Medical Center ($275,000)
  • —April 2017 – Palantir Technologies, Inc. ($1.66 Million)
  • —April 2017 – Bank of America ($1 Million)
  • —April 2017 – Splunk, Inc. ($2.7 Million)
  • —Jan 2017 – Lexis/Nexis ($1.2 Million)

So stay tuned to see how this all unfolds.