Interview transcript:
Terry Gerton All right, let’s start with this first question. What is the Office of Federal Contractor Compliance Programs?
Rebecca Klar Yes. So, the office, also known as OFCCP, had the power to both enforce these affirmative action plans that companies that do business with the government had in place, as well as the ability to audit these companies to make sure that they’re complying with these plans that they have in place as well as not discriminating on the basis of race, sex or anything else. Essentially sort of this extra level of compliance for companies that have contracts with the government compared to, you know, the standard level of regulations that any other private company would have to follow, to have in place.
Terry Gerton And OFCCP is established in statute, correct?
Rebecca Klar Yes, OFCCP was established through this decades-old executive order, which sort of put it more vulnerable to having an administration come in and overturn it, which is what we saw early in the Trump administration this year — through an executive order rescinded the underlying executive order that established most of the OFCCP’s power. So, they’re in the process of going through and seeing what’s left of the office, and essentially the only statutory obligations that they have that wasn’t from that executive order to enforce anti-discrimination laws against veterans and for disabled workers and a big bulk of what they did sort of was through this executive order that President Trump has come in and sort of easily overturned.
Terry Gerton I see. So the statutory core of it remains, but the part that was created by executive order has now been overturned by the Trump administration.
Rebecca Klar Right, it’s been overturned and sort of what we’re seeing now is a bit of confusion of what’s left and what companies should be able to do, what they can voluntarily do, and if there’s even a risk of things that they were doing before to comply, if that might make them even a bit more of a target — since some of what happened with OCCFP and what the Trump administration has done has been tied a bit to their diversity, equity and inclusion, anti-DEI work. Experts have said and lawyers have said that what OFCCP was doing is sort of different than what you might be thinking about with traditional DEI programs like affinity groups or leadership programs. But especially some of the aspects of affirmative action plans, if there was any goal-setting within those has sort of been tied up into this same initiative by the Trump administration. And the executive order in which the president rescinded the executive orders that established most of the OFCCP’s power came from one of these anti-DEI orders that the president put in place.
Terry Gerton So let’s back up to what the administration actually has done to OFCCP. If they’ve rescinded that executive order, they’ve also laid off most of the people in OFCCP, correct?
Rebecca Klar Right. There was a memo earlier this year that came out that suggested they were going to fire like 90% of the office. It’s not a major office. They have about 500 employees nationwide. And what we’ve seen so far through emails to workers is, you know, anyone who didn’t take those deferred action or early retirement programs that were offered to many federal employees have been put on administrative leave and then received a notice saying that they were gonna be laid off. So that was most of their staff across the country. They had an office in the Dallas region that sort of remains, as well as some of their national office employees. The notes that went out to these workers said that the reasoning for this is because the bulk of the work they were doing is no longer in effect, based on getting rid of this executive order. And that would be the reason for these layoffs. Some of that action now is a bit paused because of the ruling out of California that’s impacting these wider sets of layoffs, but right now, they’re on administrative leave and it’s heading in the direction of sort of this total upheaval of the office.
Terry Gerton I’m speaking with Rebecca Klar. She’s the labor reporter at Bloomberg Law. So Rebecca, tell us a little bit more about what the current status is. They’re on pause, so these workers are in limbo, yes?
Rebecca Klar Right. These workers are in limbo. And I think even further back from receiving these notices, it was clear that once that executive order was in place that undid most of the responsibilities of the OFCCP, these workers were being told not to keep doing the work that they had been doing. So it wasn’t only saying no new plans, it was anything that was under review, or if there were any audits, which were sort of common actions for the OFCCP, that was sort of on pause. So it seems like both the action of the agencies have been paused as well as now these workers who are set to be laid off is sort of paused. So it’s a bit of a wait and see, it seems right now.
Terry Gerton Has the Secretary of Labor offered any clarification, any statements on what the future of OFCCP or these individuals are?
Rebecca Klar I haven’t seen much from the secretary sort of weighing in on this. Another aspect of this that I’ve heard from workers is that they’ve also had very little direction from the office itself and from leaders to meet with them. Union representatives have been asking to meet with them and it seems like there were media reports and obviously the executive order that came out publicly undoing the agency but other than that, it seems they’ve had very little direction about what was happening to the lead up of getting placed on administrative leave and laid off. It didn’t seem like they had many updates heading up to that point.
Terry Gerton So what does this mean for the contractors who have these reporting requirements? Have the reporting requirements gone away? Do they still have to report? Is the system up and running? Is there anybody to check? How’s that all working?
Rebecca Klar So it seems like from what they’re saying that these requirements are no longer in place. When I’ve talked to some lawyers who work with companies, it seems like there’s a little bit of a mixed bag in terms of recommendations. You know, some people saying you should still keep up with some of what you were doing before because it could help you find any blind spots of discrimination that could lead to action. At the time I think some people are warning that if you continue doing these actions that are no longer required, that might make you a bit more of a target potentially for this administration, which has obviously not been hesitant to sort of look into, to companies and some of their action in this space. So it seems like those reporting requirements are gone and it would be a bit more voluntary if companies choose to do that. But at the same time, it doesn’t seem like there’s a clear distinction yet of what might happen with the agency. Obviously there’s also still the requirements under the statutory obligations for veterans as well as disabled workers. That was something in a memo we reviewed from the director that was brought in for the OFCCP had said — they were going to look through and see if those obligations could remain as well. So there might be an update there, although be a little bit more difficult since those come through Congress. But that’s something I think that companies should be thinking about, if they still have those obligations under the law.
Terry Gerton There’s a lot of tensions there to manage between statutory obligations, executive order reporting, visibility, compliance. So that makes it really tough for contractors who are wanting to stay engaged with the federal government, but not wanting to be too obvious about how they approach this issue.
Rebecca Klar Yeah, it seems to be a bit of a confusing time right now to see, you know, what they should do. This system that’s been in place for decades definitely seems to be coming undone. I think it’s just a little unknown exactly where it’s heading right now.
Terry Gerton So read the tea leaves for us. What do you think happens next and on what timeline?
Rebecca Klar I think the next thing that we’ll be watching for is, you know, what happens with this court order, with the temporary restraining order that’s in place to see how that impacts the layoffs at OFCCP. I think there’s a chance as well where workers have been saying that they didn’t necessarily follow the proper system, so there might be some action they could take there. But I think, unlike other agencies, since so much of the power was established through executive order, I think. That does give the administration a bit more power. I know another push I’ve heard from some workers is trying to influence Congress to reestablish this through a law that would keep the OFCCP in place more than it would be through an executive order. I think that might be a bit difficult with Congress these days as well. So I definitely think in the most immediate future would be looking to see what happens with these layoffs that have been roped into these, you know, broader administration layoffs.
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