Here are some take aways/highlights from the NILG Conference I think will be of interest – some of which will already be familiar but reinforces the direction that is being taken. Note, there were no current, pending regulations in play at this time, as was the case last year. Therefore topics were more centered around implementation of the regulations and Analysis Strategies. Also, Compensation Analysis was also a major topic as well as Outreach for VETS/IWD’s.
Pay Equity Strategic Enforcement:
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President Obama, by Executive Order in April, 2014, enacted legislation banning federal contractors from disciplining or otherwise discouraging employees and/or applicants from reviewing pay. It is also noteworthy, that 11 States now have “Pay Secrecy” laws that prohibit retaliating and/or disciplining employees for discussing pay.
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Steering - an area that OFCCP appears to be delving into more and assessing both ways – are certain groups upwardly or downwardly steered (i.e. are females steered into smaller sales territories, lower pay positions, given worse sales leads, etc.). Research was reviewed that showed that just because a correlation may exist between certain jobs and pay – it doesn't mean that the pay is caused by the correlation. However, OFCCP begins to assess correlation and a presumption of discrimination will prevail absent business related justifications and/or documented applicant specified preferences. The emphasis here was that contractors should track applicants’ preferences (i.e. regarding shift’s, locations, position, etc .), which becomes crucial in defending potential steering charges.
- There are two primary Statutes under which to bring forth Pay Equity Discrimination charges. Title VII and the Equal Pay Act (EPA), which pre-dates Title VII.
- Title VII: provides the ability to bring forth lawsuits where employees are “similarly situated” - thus, they do not have to be in the same exact job. Also, the positions do not need to be at the same establishment or location.
- Equal Pay Act: This statute is more rigorous. Employees must conduct “substantially equal work” and must be in the same location. However, there is a preference toward bringing charges under the EPA rather than Title VII and some of the reasons for this preference are as follows:
- The EPA statute provides for strict liability based on 4 criteria. Thus, proof of the intent to discriminate is not necessary.
- The limitation period was significantly expanded by the Lilly Ledbetter decision vs. Title VII, which requires the charge to be filed within 300 days of the discriminatory act. This is not necessary under the EPA.
- The damages that can be awarded are twice that of those that can be awarded under Title VII – and can extend to discrimination regarding “Employee Benefits, Vacation, Bonuses, etc.” not just pay.
- It is not necessary to file an EEOC complaint first as with Title VII, which does require for a complaint to first be filed with the EEOC.
- Standards for evaluating pay differed between EEOC and OFCCP and caused conflict amongst agencies. OFCCP is looking to use the same standards as the EEOC. Thus, the reason for rescinding prior compensation self evaluation guidelines and referring to Title VII as the new standard. Goal is to use the same standards as the EEOC:
- OFCCP is usually relying on statistical evidence but the 2 SD rule is not hard and fast – looking for patterns and practices – so does not necessarily have to meet the 2 SD result to be identified as an potential pay discrimination issue.
- Starting pay is an area of focus and where pay issues are often identified. Also, emphasized that prior job pay is not being accepted as an airtight defense for starting pay differentials – perpetuates the disparity. It needs to be justified based on experience for the position, etc.
- OFCCP will run regression analysis and this is done at the National Office (with a total of 4 Statisticians only – indicated they are looking to hire more at the district level). CO can run a few initial tests at district level and then decides whether or not it needs to be referred to National, which does all of the true statistical analysis of similarly situated groups and regression.
- FCCP is looking to see if there are legitimate proxy measures (factors) that should be considered (used in the regression analysis) and for the most part reviewing to assess if practices are consistently and “neutrally” applied. They are also getting away from using the terms “Minority/Non-Minority” and moving more toward “Neutrality” across all groups.
- OFCCP is looking to review comparable employees based on the contractors Pay Data and information gathered during an interview with the contractor regarding their compensation system. OFCCP at times may seek to create further aggregations of employees for analysis if it seems reasonable based on the information gathered during the contractor interview. They stated that it is often time to eliminate employees from the group and not add any in order to have the correct focus for pay comparison purposes.
- Anecdotal evidence becomes very important when dealing with individuals and small groups because SD results not possible with smaller statistical groups.
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Define who is comparable -create the “Pay Analysis Groups” (PAG), and they made it very clear that this does not equate to “Job Groups” (interesting comment I thought), although OFCCP will run analysis by Job Groups so contractors should do so as well.
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When developing PAG’s consider similar work schedules, exemption codes, credentials, demands, qualifications requirements, etc.
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Assess for Neutrality across all groups
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Develop a very standard process for establishing Starting Pay that weights the factors considered by importance. This will provide the documentation and constituency for defending those potential pay differences.
- Outreach/Recruitment VETS/DISABILITY:
- Made it very clear that ESDS Listing is required and not considered Outreach under the regulations. This is the minimum requirement and will not satisfy requirements for conducting good faith outreach/recruitment efforts.
- Recently Separated Vets do not have to be tracked separately.
- First Implementation Year AAP should include the following – although reporting and documentation not yet required:
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Statement of Expected Outreach (will implement)
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Discussion of Audit & Reporting System Plans (will implement)
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Statement of Hiring Benchmark being adapted (will implement)
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Statement of Utilization Goal being adapted (will implement)
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Suggested the use of automated “Trackers” (offered by THOMAS HOUSTON)
- There will be no IRA’s on the new data requested (vets/disability applicants, hires etc.)
- Not meeting Utilization Goal or Hiring Benchmark is not a violation at this time. These are considered “Aspiration Goals” different from Executive Order 11246 requirements.
- Articulate Goals to Management
- Harness Support of VETS on staff
- Not a Charity Initiative – should not be viewed as such – rather makes sense from business perspective
- Build your Brand as an Employers who truly values and embraces Individuals with Disabilities and Protected Veterans.
- Make sure you are engaging employees- it is not just a “once a year” thing – not just giving it “lip service”
- Audit Strategies -Confirmed that Adverse Impact/Hires and Compensation are leading areas in findings of Audit Violations
- Balance Data – Ensure Accuracy
- Cohort Analysis of Comp Data recommended regardless of Statistical Analysis by PAG results.
- Discuss compensation with Compensation Manager prior to interview with OFCCP
- AI/Review by Stages of Employment process - OFCCP not to keen on by requisition review – prefer hiring stage analysis.
- Review Availability stats vs. Apps representation – does the availability definition make sense to the applicant flow representation.
by Maribel Gregory, Project Manager, THOMAS HOUSTON
