In the scheme of the Administrative State’s employment anti-discrimination functions, the Department of Labor’s Office of Federal Contract Compliance Programs (“OFCCP”) is often overlooked. Yet, the role of the OFCCP is significant and important because that agency administers and enforces multiple equal employment opportunity laws among businesses that employ approximately 25% of Americans. With a $100 million budget and 500 employees, the OFCCP accomplishes its mission by examining the employment practices of federal contractors and subcontractors to determine whether they comply with equal employment opportunity and affirmative action obligations under such legal authorities. This teleforum will survey the role and functions of the OFCCP, the context of its unique statutory authorities, and its public introduction of limiting principles to its enforcement practices.
Craig E. Leen, Director, Office of Federal Contract Compliance Programs (OFCCP), U.S. Department of Labor
Robert J. Gaglione, Deputy Director, Office of Federal Contract Compliance Programs (OFCCP), U.S. Department of Labor
Moderator: Aram A. Gavoor, Professorial Lecturer of Law, The George Washington University Law School
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Operator: Welcome to The Federalist Society's Practice Group Podcast. The following podcast, hosted by The Federalist Society’s Administrative Law & Regulation Practice Group, was recorded on Monday, December 16, 2019, during a live teleforum conference call held exclusively for Federalist Society members.
Wesley Hodges: Hello and welcome to The Federalist Society's teleforum conference call. This afternoon's topic is “What Is the Office of Federal Contract Compliance Programs?” My name is Wesley Hodges, and I am the Associate Director of Practice Groups at The Federalist Society.
As always, please note that all expressions of opinion are those of the experts on today's call.
Our moderator for the discussion is Aram Gavoor, who is a Professional Lecturer of Law at the George Washington University Law School. His scholarship in the field of administrative law has been cited by the Supreme Court of the United States and by others in prestigious law journals. He serves on the Executive Committee of The Federalist Society’s Administrative Law & Regulation Practice Group. Thank you very much for sharing with us today. Aram, the floor is yours.
Prof. Aram Gavoor: Thank you, Wesley, and thanks to everyone for joining us. It is my honor to moderate today’s discussion on the role that the United States Department of Labor’s Office of Federal Contract Compliance Programs, known as OFCCP for short, plays in the latticework of the administrative state’s employment antidiscrimination functions. This agency, which some overlook, is important because it administers and enforces multiple equal employment opportunity laws among businesses that employ approximately 25 percent of Americans, and it functions with a budget of $100 million and a staff of 500 employees. OFCCP has been quite active lately with the introduction of limiting principles to its enforcement practices among other significant changes.
With us today are the Director of OFCCP, Craig Leen, and the Deputy Director of OFCCP, Bob Gaglione. Craig Leen, prior to serving at OFCCP, was the City Attorney of Coral Gables, Florida, where he was the General Counsel and the Chief Legal Officer there. Before serving as the City Attorney, Mr. Leen was the Chief of the Appeals Section and then the Chief of Federal Litigation Section at the Miami-Dade County Attorney’s Office. In these roles, he litigated and provided counsel in numerous legal issues, including on many civil rights matters.
Mr. Leen has taught courses in various legal subjects on an adjunct faculty basis at the George Washington University Law School, Florida International University College of Law, and the University of Miami School of Law. He received his Juris Doctorate from Columbia Law School, graduating as a Harlan Fiske Stone scholar and having served as a teaching fellow in both contracts and torts. Mr. Leen received his Bachelor of Arts, cum laude, from Georgetown University where he majored in both government and economics.
Mr. Gaglione, prior to his appointment as Deputy Director of OFCCP, was a business and civil trial lawyer in California, arbitrator and adjunct professor teaching law and political science classes. So as a friendly reminder to the audience, our speakers today are U.S. government officials and will naturally refrain from discussing active litigation and non-public or deliberative content. Again, it’s my honor to moderate this discussion, so let us proceed with Director Leen and Deputy Director Gaglione.
Craig Leen: Thank you very much. It’s such a pleasure to be here. This is Craig Leen, the Director of OFCCP, and I thought I would begin by giving a little bit of a synopsis of what the agency does since the question is, “What is OFFCP?” And it’s basically an introduction to it. And then I thought I would give you a description of some of the things we’ve been doing in this administration to improve the efficiency and accountability of OFCCP to the public, and then finally, go through some issues of administrative law and other similar issues that are of interest to The Federalist Society and where I think OFCCP has really -- and this administration in OFCCP is supporting rule of law issues that I think would be of interest to those on the call.
So let me just start a little bit with a synopsis of OFCCP. OFCCP stands for the Office of Federal Contract Compliance Programs. It’s a subagency in the United States Department of Labor. The Director, which is me, is the head of the agency, and I report to the Secretary of Labor and the Deputy Secretary of Labor. We enforce three authorities, Executive Order 11246, Section 503 of the Rehabilitation Act, and VEVRAA, which is a veterans protection statute. By the way, Section 503 of the Rehabilitation Act is a disability protection statute.
Let me start with Executive Order 11246. This authority requires affirmative action and prevents discrimination on ten different grounds. The first nine are protected classes. Those are race, color, sex, sexual orientation, gender identity, national origin, religion, disability status, and veteran status. In addition to that, our tenth protection is pay transparency. So our agency -- if you’re a federal contractor, you must enforce a policy of pay transparency which means that people can talk about their salary and not be disciplined for that.
Section 503 of the Rehabilitation Act is the component that requires affirmative action in the antidiscrimination as to disability status, and then VEVRAA, obviously, as to veteran status. And I will also note that no one of these is more important than the others. The regulations treat them all as equally important. And one of my goals as OFCCP director has been to ensure that looking at every one of the protected classes and that we are ensuring the faithful execution of the laws as to each of these protected classes.
Now, as OFCCP director, I have made a focus of my work, and I think Bob would say the same, on four principles: transparency, certainty, efficiency, and recognition. And I’d like to go briefly through each of them. Transparency: Now, one thing that you should know about OFCCP, and it ties into the issue of transparency, is that the agency does two types of reviews. So if you’re a federal contractor -- and there’s about 25,000 federal contractors in the United States, with about 120,000 federal contractor establishments. And an establishment would be like a factory or an office or a store. And as was mentioned at the beginning, it makes up about 25 percent of the American work force.
The way OFCCP does its business is that every year, we do about 1,000 audits a year, and we’ve been trying to increase that in this administration to a goal of 3,500 audits a year. And in addition to that, we do complaint investigations. So if someone works for a federal contractor and believes they have been discriminated against on one of the grounds I mentioned, they could file a complaint and the OFCCP would investigate that complaint. We have a memorandum of understanding with the EEOC, the Equal Employment Opportunity Commission, and we refer some of our complaints over to them for investigations. But in many ways, we are very much like the EEOC for federal contractors.
One thing we do that the EEOC does not do is we do these mutually scheduled audits. So if you are a federal contractor, as part of the deal, as part of the agreement to be a federal contractor, you sign up to allow OFCCP, every so often, to do an audit of your employment and hiring practices, your pay, your promotion, and hiring practices, employment practices generally. And like I mentioned, we do about 1,000 a year.
So one of the issues that occurred to me when I started and I had done my review of the agency was that many people didn’t really know much about what OFCCP did or how we scheduled our audits, or how we assessed pay or hiring at a particular company. So that was one of my main focuses was transparency. Very soon after I started, we issued a transparency directive. I felt it was incumbent upon the agency to be very clear based on rule of law principles as to why we audit certain companies, how we audit them, and when we make a finding, what sort of finding that we’re making, that should be very clear so that the company can fix it.
So to start with, why we audit companies. One thing that was very important to me as the director was that we be very clear as to how we pick the companies for audit because for many years, that was not known. Every so often, a company would get a scheduling letter, and they didn’t know how they were picked. And they would challenge in litigation whether they were neutrally scheduled because OFCCP has a duty. When we schedule the company for review, it needs to be based on neutral principles, which basically means it could be on the size of the company, it could be on the geographic location of the company, it could be on the area the company works in. But it has to be on predetermined, neutrally scheduled principles that are then applied to pick the companies that meet those principles or meet the methodology that we use.
So one of the first things I did was I published a methodology. We started publishing the methodology every time that I wanted companies to have confidence that OFCCP was selecting them in a neutrally scheduled way. In addition to that, I wanted companies to be able to criticize our methodology and civil rights organizations to be able to criticize our methodology if they felt that it wasn’t working well.
Likewise, we started publishing a list of all of the companies that we were auditing every year because I wanted to normalize the idea of being audited. That’s part of being a federal contractor is that you’re audited. It doesn’t mean that you’re are committing discrimination. It doesn’t mean that there’s anything negative that’s happened. All is means is you’re a federal contractor, and our duty, our charge as OFCCP is to neutrally schedule contractors and to review them.
So that has been a resounding success. We have been publishing methodologies now for about a year and a half. We’ve published several methodologies. We’ve published a couple of scheduling lists. And federal contractors seem to be happy about it. I think the press is happy about it because they can scrutinize what we’re doing, and the public because they can see that we’re doing a lot of work. We’re doing a lot of these audits.
An additional part of transparency that was important to me was to publish more information as to our data as to what we were finding. So we started publishing all the conciliation agreements that we would reach. And what a conciliation agreement is is anytime OFCCP makes a finding -- and we make a finding in about a quarter of our audits. In about a quarter of the audits, you make some sort of at least technical finding that a company is not in compliance with our regulations. And that can be a record keeping violation, that can be a failure to have an affirmative action program, it can be a variety of different things.
In about two percent of our audits across time, and this across administrations, in about two percent of our audits, we find discrimination. So one thing that was important to me was to make sure companies knew when we made a finding, that we made a finding, that the public knew we made a finding, that companies could see what the finding was, and that they could learn from it. So we started publishing all our conciliation agreements. And if you’d like, you can go to our foyer reading room on OFCCP’s website and look at every conciliation agreement we’ve reached in recent times. So take a look at that, and I think you’ll find it very educational about different areas where OFCCP is finding problems and fixing them.
Another thing we did with transparency was one of the concerns that we heard in the audits that we were doing was that companies didn’t feel like they knew what findings we were making until very late in the process, sometimes never during the administrative process, and they would only find out what the very specific findings were and be able to replicate them at the time we brought a case. So I wanted to change all that. It seemed to me it was very important very early in the process that we were publishing our findings to the contractor and letting them challenge them if they would like, working it out with them, conciliating with them, and then hopefully reaching a resolution of that case. And that’s worked very well too.
As part of the transparency directive, we have now directed our staff any time they make a finding, they’ve got to share it with the company. They’ve got to share enough information with the company that it can replicate the finding, which is extremely important. Obviously, replication is part of the scientific method, is part of any rigorous approach. The ability to replicate, that’s what gives companies confidence that our findings are justified. Now, they may not agree with them. They may not agree with the way that we came to get them. But as long as they can replicate them, they can then see how we reached these, and then they can determine for themselves what amount of weight they deserve. If they agree with them or if they think they are at least weighty, hopefully they’ll settle the case with us. If they don’t, they can challenge us through the administrative process.
Another thing we did as part of transparency, and this was a separate directive, the preliminary determination notice directive, is we created an administrative process so that companies could challenge findings earlier in the process. One thing -- I need to give you a little background here. When I started at OFCCP, we had many audits that were many years old. So essentially, OFCCP would send a scheduling letter to a company. We would start getting information from them, and we had over 100 audits that were over four years old. And we had some audits that were six, seven, eight years old.
And we settled one case right at the beginning of the administration that was 23 years old, believe it or not, 23 years old. I’d never heard of a case like that, 23 years. Just think about what that means. A case that takes 4, 5, 8, or 23 years, it means that if you do find a remedy that it’s not really going to help very many people because they probably have all left the company by then, or they’ve had to suffer the discrimination we’re finding for many years.
For a company, it’s a terrible thing to have a five, six, seven year audit, particularly if we end up not making a finding because they’ve essentially been punished for being a federal contractor even though they haven’t discriminated. And in situations where we do find discrimination, like I mentioned, the most important thing is to bring a prompt remedy to fix it going forward prospectively, and also to provide a reasonable back pay amount so that we can resolve the matter.
Transparency was important to me because I wanted companies to know very early in the process what our findings were and be able to contest them administratively before they had to go to an administrative law judge or go through the entire Administrative Procedure Act process to adjudicate a case. So what we did was I issued a -- well, my predecessor, Ondray Harris, issued a directive which I was a major part of putting together and that I’ve continued to support, which was the preliminary determination notice directive which said that before OFCCP makes a finding, which can be out of the blue, that we’ve been doing this review for so long, and then boom, notice of violation. Before we do that, we issue a preliminary determination explaining our findings and allowing the company an opportunity to do a response that will be reviewed at the national office level by that top career official and the director, who is me.
It was important to me that we have this review to ensure that every region — we have six regions in OFCCP and 48 district offices at each region and district — was acting consistently, that there was a degree of uniformity to the way that we were approaching problems or issues, that we were providing similar remedies in similar regions so that in one region, a case that would be brought in one region would be brought in another region, a case that would be dismissed in one region would be dismissed in another region, and that we were having this sort of interaction across the regions to make sure that there was a degree of consistency and uniformity.
The preliminary determination notice directive was very successful. We’ve been issuing PDNs now for I think about a year and a half uniformly across the agency before we find discrimination. And it has helped us refine our analysis because essentially what we do is we provide the company the information so they can replicate it. They then have an opportunity to respond and tell us where we made a mistake, if we did, or maybe there was some additional variable that we should have considered. Maybe the pay analysis group or grouping that we used to analyze pay was problematic. They can raise that issue.
And ultimately, this is reviewed at the national office and in the regional office, and then we issue -- we can either decide not to proceed with the case, we can modify our findings, or we can issue the findings as they were originally stated. And we do that through a notice of violation. Once a notice of violation is issued, we enter into a conciliation period which for the agency was going for many years sometimes, and I wanted to shorten to basically a six month period because I wanted to keep moving these cases along. So that’s another thing that I’ve been focused on, and I’ll talk about that a little more with efficiency, but that’s basically the focus of transparency. So we’re publishing more information, we’re publishing it earlier, we’re sharing the information nationwide, we’re subjecting ourselves to criticism, which I think is important for an agency to do.
That’s something I learned when I was City Attorney of Coral Gables. It’s important. And I was a public official there. I was the chief legal officer. I issued all of my opinions -- I issued over 400 city attorney opinions as city attorney, legal opinions regarding the city charter and the city code. And by doing that, it allowed the public to see them, to challenge them. It allowed attorneys to see them, to challenge them. And it basically ensured that we were giving the taxpayer the value that they deserved. Here’s the opinion. You can see it. Everyone can see it. It’s not something that’s just for the agency. So that was the transparency focus. It’s worked very well.
Now, I’m going to move to certainty. And before I start with certainty, I want to give you a little bit more analysis as to how we do our reviews. And I’m trying to -- I want to keep this interesting so at different parts of the discussion, I’m telling you a little bit more about the agency. So what OFCCP’s literally know for is our systemic compensation and hiring reviews. And what we do there is the company will basically give us granular data per employee about their pay and about their hiring. And we take that data and we run out a regression analysis, and we determine whether there’s disparities in pay or hiring based on gender or race, which is typically the focus of these regression analysis because some of the other areas we protect, we don’t get sufficient data to be able to do this sort of review. Although I will tell you, I am trying to do these sort of reviews now in the area of disability and veteran status as well, and we’ll talk about that a little bit later.
But right now, in the area of race and gender, we do these hiring and compensation analyses, and then if we find a disparity in pay or hiring to more than two standard deviations under a statistical analysis, we typically will consider whether to make a finding or not. That’s why we would issue a preliminary determination notice. The company would then have an opportunity to respond, and if the response was inadequate to explain the discrimination based on a nondiscriminatory factor, we would issue a finding, and then we would have the company fix it, both going backwards through backpay and forwards through prospective relief by correcting the disparity.
Let me talk a little bit about the area of hiring. So in a hiring case -- and I want to be clear. OFCCP -- the affirmative action we do is not the type of affirmative action that many people think of like in the school context, like universities or things like that where there’s a preference that may be given to a certain race or gender based on the representation of that race or gender at the university. That’s not quotas, but under certain existing case law, companies are able --pardon me, universities can favor an applicant, can, as one data point, look at diversity. That’s not the type of affirmative action that OFCCP does or that’s allowed in the employment context.
They type of affirmative action we do is we look at the representation by race and gender in the company. So let’s say, based on census data, that representation of men and women in this field in this area is 55 percent men, 45 percent women, let’s just say as an example. And let’s say the company in this particular job area is 60 percent men and 40 percent women. Well, what they need to do is they need to do outreach. First, they need to look at their employment practices to see if there’s some sort of policies in place that are leading to a lower representation of women in the company. And then second, they need to look at whether they should do outreach to try to get more women applicants.
But ultimately, when they actually asses people and determine whether to hire them, they are not allowed to consider gender or race in whether to hire someone. In fact, if they do, we will find them liable for discrimination, even if that discrimination is against whites or males or any group. We don’t allow discrimination of any sort in hiring. So as an example, let’s do one based on race. Let’s say, for example, for a particular job, a company had 100 applicants who were Hispanic and 40 applicants who were white. And let’s say that they hired, let’s say 75 percent of the whites, 30, and only 25 percent of the Hispanics, so 25. So there would be a significant disparity in the percentage of hiring.
And the other thing is that the only -- when we look at these numbers, we’re only looking at qualified individuals. So we keep out of this analysis anyone that’s not qualified. So they have to meet the minimum qualifications. So you have 100 Hispanic applicants and 40 white applicants, and you’re hiring 75 percent of the white applicants and only 25 percent of the Hispanic applicants. You have a problem.
We’re going to do a review and we’re going to see that to more than two standard deviations, you’re favoring in employment white applicants over Hispanic applicants. And that’s based on the ratio. And then what we’re going to do is we’re going to control for all of the different variables that the company considers in hiring, so education, experience at the company, productivity. It could be a number of issues. We’re going to control for all of those factors, and if it’s still unexplained, if there’s still a difference in hiring rate of qualified individuals of both races that is not explainable by other legitimate factors, then we’re going to make the company fix it.
And I think that both conservatives and liberals would support this approach. This is a race neutral approach, a gender neutral approach. It basically says that when there’s a disparity that cannot be explained or can only be explained by discrimination, then the agency must come in and correct it. And that’s been one of my focuses at the agency is through transparency, and now the second principle, certainty, make sure that companies know that, that they’re not supposed to favor in employment any group, that, in fact, all that they are supposed to favor in employment is merit. But that assuming that they are applying merit principles, they should generally be hiring qualified people at the same percentage. And if they’re not, and if it’s a significant disparity, statistically and practically, then the agency is going to require them to fix it. And I don’t think that that’s a controversial proposition at all. I think most people would agree with that. I certainly agree with that.
So let’s go to the issue of certainty, though. As part of that idea, it’s important that companies understand how we assess hiring and how we asses compensation. So what you’re going to be seeing -- you’ve already seen this from the agency. To a large extent, we’ve issued a number of FAQs, frequently asked question answers. We’ve issued a couple of technical assistance guides. But you’re going to be seeing a lot of guidance continuing to be issued by the agency explaining how a company should evaluate pay and how a company should evaluate hiring for purposes of equal employment opportunity.
We’re not going to tell them what variables to consider. That’s up to the company. This is a capitalist economy. This is a market economy. Companies are allowed to determine for themselves what sort of factors they would consider when setting pay or hiring people, what sort of experience is useful for a job that they want to hire for, what sort of performance factors should be considered in determining how much of a bonus to give. What they’re not allowed to do, though, and this is both as a matter of Title VII generally, but also if they’re a federal contractor under the executive order, what they’re not allowed to do is make any determination that’s based on race or gender, or on a discriminatory reason, based on one of the ten factors that OFCCP enforces.
And because we are using somewhat sophisticated regression analyses to assess this, we are publishing a lot of information about how we do that. This started with a compensation directive that was issued last year which rescinded a prior Obama-era compensation directive that in my opinion did not give adequate guidance to companies as to how the agency would review pay. In my opinion, that prior compensation directive granted too much discretion to the agency on a case by case basis to change the way that it evaluated pay.
Take a look at both of them yourselves. It’s Directive 307. That’s the Obama-era compensation directive. And then take a look at our directive, which is -- what’s the number? Our directive doesn’t have such a short number. We’ll get you that. But take a look at our directive. I think it’s 2018-05. Let me get that for you, but take a look at our directive. It’s on our website. OFCCP Directives -- there’s one that says compensation. Take a look at it and what you’ll see is a very helpful directive that goes step by step as to how to form a pay analysis group, how OFCCP would do that, what sort of factors OFCCP considers in establishing that, and then the findings that we make. It’s Directive 2018-05. I remembered it correctly. Thank you.
So we published that. We published technical assistance guides. We are trying to publish more and more information so that we achieve certainty. And you know why? And this is something I believe very strongly in. The more clear we are about how companies should not and cannot discriminate, the more information we give them so that they can do these regression analyses themselves in advance the same way OFCCP would do it, the more we are going to help equal employment opportunity in this country in advance.
Yes, we’re going to continue doing our reviews. We’re going to continue to make our findings. We’re going to continue to get results for the American people through our reviews and through conciliation. But ultimately, we’re only able to review a couple percent of all of the federal contractor establishments per year. And the important thing is that all of the federal contractor establishments are complying with the law. So the more compliance assistance we can give, the more guidance we can give, the better. So that’s the certainty principle.
Let me take a break at this moment to tell you something that I think you’ll find very interesting also. This administration, OFCCP has been the most successful it has ever been. Now, you might say that’s a provocative statement, but it is. It is. And you know why I can say that? For two reasons. One, in terms of our recoveries for equal opportunity employment in the United States, OFCCP in this last fiscal year, fiscal year 2019, more than doubled the recoveries from the highest year during the Obama administration.
In addition to that, the past three years of recovery for OFCCP, FY 2017 through 2019, is the highest three-year period on record and exceeds the prior seven years combined. This last year, we paid a record $40,569,816 in monetary settlements for affected class members, $60 million more than the next highest year, which was the first year of this administration, Fiscal Year 2017. So the first and second highest years in history were in this administration in terms of recoveries. You know how we did it? Through these principles, through being more efficient, through settling cases quicker, through sharing more information with the companies so we could reach a resolution quicker and get a remedy to affected employees quicker.
Now, I will tell you that equal employment opportunity is apolitical and nonpartisan. The Bush administration, the Clinton administration, the Obama administration, the Trump administration -- we are all strongly supported by equal employment opportunity. What I think these numbers show you, though, is that this sort of approach where we try to work with companies and give them information and sit down with them and share information and try to get it right is a more effective way to enforce equal employment opportunity in the United States, and we’ve gotten great results because of it.
I told you there were two reasons why I could say this. The second reason is we also, in terms of compliance assistance, had our most successful year ever. In Fiscal Year 2019, we answered over 4,500 help desk inquiries. We have a help desk as OFCCP. Imagine that. How many federal agencies have a help desk? We have a help desk. You can get an actual person. You can send us an email, you can call us, or you can go on the web and you can actually use our online help desk. We had over 4,500 help desk inquiries that we responded to, the highest ever in a single year by far, providing helpful guidance through compliance assistance, FAQs, and stakeholder events, town halls, etc. So this is been a big focus of mine, and I’m very proud of it. So that’s the certainty principle. We are providing more certainty to federal contractors.
Now, efficiency. When I started at the agency, the aged case rate -- and this is something I think The Federalist Society would be very interested in and concerned about as well. The aged case rate for our compliance reviews, our administrative audits, was high. And what an aged case is, just for background information, is a case that’s over two years old at the administrative level. So we sent out a scheduling letter. We’ve started our review. That review goes over two years. And remember, the way that it works is we do this review, we make a finding, and then we try to conciliate the finding. If we can’t make the finding, then we go to an administrative law judge. Then that goes through the APA, the Administrative Procedure Act’s process.
So this is just at the administrative stage. It’s already two years old. Our aged case rate was about a third of all of our cases were aged. And like I mentioned, we had over 100 cases that were over four years old, and many over five, six, or seven years old. We’ve already decreased that aged case rate to around 15 percent. It’s a little bit above 15 percent, but that’s the goal for this fiscal year, and we will be there, and then with the ultimate goal of getting to 10 percent in the next fiscal year.
And let me tell you, having a lower aged case rate, being more efficient in the way that we review these cases and resolve them, is of a great benefit to the American worker because what it means is that -- remember, a lot of our OFCCP audits are confidential. People don’t know that they’re being discriminated against or that they have a pay disparity that’s unexplained by the company that should be addressed once we go through this whole review process. They don’t know that, and they don’t know that for several years, which means that they’re continuing to suffer this discrimination.
By being quicker, we do two things. One, we make sure people know sooner what’s happening, and two, we fix it, and we fix it in a way that provides both back pay and prospective relief. That’s the focus of this approach, and it’s by sitting down with the company and working with them at the earliest stage possible to resolve the matter. To that end, as part of both certainty and efficiency, we adopted the Early Resolution Procedures Program.
And what that does is -- this is something took from when I was city attorney because I knew as city attorney, for example, the city -- and this is true for the county, the city, or any -- and I used to work in the private sector as well as an attorney at several law firms. If a city or a company doesn’t agree with the finding, or even if they may agree with the finding, they may not want to have the finding made. They may dispute it. They may, in fact, go to a hearing because ultimately the finding itself is what they need to contest, even if they’re willing to pay the amount that OFCCP would like to fix the disparity we found. Those findings cause a big issue.
So one thing that occurred to me was, well, why don’t we, very early in the process, share the information with the company, maybe even before we make a preliminary finding, share the information with the company, show them what we’re seeing, and give them the opportunity in good faith to fix it themselves prior to even a finding being made. Have them fix it, and then not only fix it at that company, at that establishment, but company-wide. Give them an opportunity to be proactive in compliance and get the guidance of the agency of the issues that we are seeing that are problem areas or that are potential areas of discrimination where a finding could be made if we continued the investigation.
This has been such a successful program, the Early Resolution Procedures Program. I believe we have over a dozen ERCAs, early resolution conciliation agreements. And don’t quote me on the exact number because it changes all the time, but I believe it’s around 15. We have a lot of these ERCAs in place. And what that means for each of those ERCAs is that the company has committed to reviewing its employment practices and fixing the disparities company-wide. And that’s something that -- and they’re under review for five years as part of this process. They don’t get audited during the five-year period. Instead, they give a report to us every year about what they’re doing. And it has been an extraordinarily effective program, and it has helped OFCCP settle more of these difficult cases. And that’s why we’ve got, in part, up to the $40 million number.
And what I like about the directive in this approach is we recognize that in most of our audits, we don’t find discrimination. Most companies -- it’s only in about, like I said, two percent or a little more than two percent, depending on the year, of audits that we actually find discrimination. Most companies, what that would tell me -- and that’s across administrations, that’s the Obama administration, the Bush administration, the Clinton administration, the Trump administration. What that tells me is that most companies are not discriminating, that it is an outlier where there is discrimination.
Now, they may effectively have violations. They may need assistance. But because of that, we can sit down with this company where we do have a finding and say, “Hey, you have a finding, or a preliminary finding. Show us your good faith. Show us that you’re not committing disparate treatment discrimination and fix it. Maybe you were not aware of it. Or maybe you were aware of it, but you didn’t realize the scale or something like that. But whatever it is, this is your opportunity to fix it. Or we can go through this whole administrative process.” What I’m finding is a lot of companies will sit down with us and fix it.
We just had a big settlement, our first -- a number of the early resolution conciliation agreements have been for older cases because we also use this program to resolve aged cases as a remedy to help us address that, but we just had one. And this company has said I can mention it. It’s public knowledge. It’s on our website. But Intel just entered into an ERCA with us where it is for a substantial sum where they are doing equal employment opportunity across the company, correcting it in advance of any finding. Take a look at that. And to me, that is an approach that makes a lot of sense. And I give a lot of credit to Intel for stepping up and being one of the first ERCAs which is truly done before a preliminary determination is made.
So finally, let me get to the issue of recognition. One other thing we’ve been recognizing is that most federal contractors are not discriminating. In fact, many of them have very impressive programs in place, disability hiring programs, autism at work programs, inclusion programs, diversity and inclusion approaches, employment resource groups for people that promote inclusion and diversity. They have a lot of these great programs, and they’re not sufficiently recognized. So one thing that we’ve been doing is, in addition to our antidiscrimination nondiscrimination focus, in addition to the compliance assistance, we’re also seeking to recognize those companies that are really going above and beyond and that never have findings and that are doing the right thing.
And so to that end, we have an Excellence in Disability Inclusion Award which we’re going to be awarding very soon to a couple companies that have some really wonderful disability inclusion programs. And we are looking for other ways to recognize companies that are the highest performing companies in the United States.
One of these that I’ve talked about is the Voluntary Enterprise-wide Review Program which will allow companies -- let’s say we’ve done -- some companies are really large. We might do ten audits a year of different establishments. And let’s say that none of those audits ever have a finding because the company is in full compliance. It’s not really a good use of governmental resources to continue reviewing 10 of their establishments a year, or 20 of their establishments a year. In fact, we should take those resources and focus on more likely violators, the ones that aren’t in compliance all the time.
So what we’ve done is we’re going to be issuing an information collection subject to notice and comment where we’re going to create this program that will allow companies, enterprise-wide, company-wide, to apply to show us that they have these company-wide programs that are preventing any findings of discrimination. And we’re going to take them out of the neutrally scheduled review process. And we’re going to review them in a different way through yearly reports and sampling and things like that. And that will allow us to focus our scheduled audits on the more likely violators. And that’s one thing that we’ve been asked to focus on by the Government Accountability Office is to find ways to focus on more likely violators. And we are doing that. So that’s recognition.
Finally, I just wanted to give one other general statement about our focus at OFCCP because we do have limited resources — and you can take this directly from the compensation directive — we have been focused on brining strong cases. We have been focused on cases where we can demonstrate that discrimination is occurring. And so the way we’ve done that is, and this is reflected in the Compensation Directive 2018-05, is that we have emphasized cases where there is a statistical finding in addition to anecdotal or nonstatistical evidence demonstrating discriminatory intent by the company. So that has been a focus of the agency, and I think that you’re going to see that in a lot of our cases going forward. They’re going to be really well put together cases where we have done the legwork, where we have gone outside and interviewed people, where we have collected both statistical and nonstatistical evidence. I think that’s going to be very helpful.
And then finally, the last thing I wanted to mention — I mention this in all my speeches — is the issue about the focused reviews. One thing that was an initiative I wanted to start when I came to the agency was a focus on disability inclusion. People with disabilities have a labor force participation rate that is much lower than the general labor force participation rates, about 20 percent compared to a general labor force participation rate of 65 percent. The unemployment rate for people with disabilities is double that of the general unemployment rate. The wage gap for people with disabilities is over 30 cents on the dollar.
People with disabilities are faced with significant discrimination every day in this country. They have difficulty obtaining accommodations. And I know a lot about this myself because I have a daughter with a very severe disability. She has autism and a significant intellectual disability, and I have had to fight for accommodations for her basically every day of her life in different ways. I don’t take that lightly. And any time I take her to a restaurant or to a movie theater or anywhere, I have to get an accommodation. I have to get -- she has this huge wheelchair stroller that we use with her, and we need to get an accommodation to get in the place. I’ve had to fight for accommodations for her in the school district.
And through that, I got very involved in the autism community, both in Florida, and I’m on the Special Education Advisory Board for the D.C. schools in my personal capacity. And I have seen that people with disabilities have a hard time getting the accommodations that they need to be fully included in the employment sector and in other sectors as well. And I have wanted to make this a focus of my work because people with disabilities have a lot of skills and they’re an underutilized part of our work force.
And so we are doing focused reviews right now that are focused on Section 503 of the Rehabilitation Act, 500 focused reviews of some of the biggest companies in the United States where we are reviewing comprehensively disability inclusion. And now, just recently, we also ordered 500 focused reviews as to veterans. And then in the spring, we’re going to do 500 focused reviews as to promotions, making sure that there’s not discrimination in promotions at companies across the United States.
This focused review approach is very useful for the agency because it allows us to bring focus to a particular issue that’s important while also publishing best practices. For example, for disability inclusion, there’s a best practice for -- that we published that you should have, for example, a centralized accommodation system. Companies should look at employee resource groups. We have over ten of them. Take a look at our website.
Anyhow, these focused reviews are very personally important to me. I want to make a big impact for people with disabilities in the United States in employment. I feel that we need to treat discrimination against people with disabilities the same way we treat discrimination based on race or gender, and that we need to be taking significant action in this area to ensure full inclusion of people with disabilities in employment.
So with that, that’s the conclusion of my remarks. I want to turn it over to Bob Gaglione, my deputy, who’s going to make a few remarks about certainty, an area that he’s been working on. And I’m really pleased to have Bob. He founded The Federalist Society section in San Diego, and I know it’s very special for him to be here. He’s a great friend, and he’s someone that’s added a lot to the agency. And Bob, please excuse me if I took too much of the time. I’m sorry. A lot of this is stuff we’ve worked on together. I want to be clear about that to everyone. Bob and I have worked together on these things. We’re both very passionate about it. Bob?
Robert Gaglione: Thank you, Director Leen. And good day to everyone. It’s a pleasure to be here with all of you. And one of the things I just wanted to let everyone know, a lot of the information that Director Leen talked about, our four principles of certainty, efficiency, recognition, and transparency, all these other programs and initiative that have been implemented here at the Department of Labor in the last few years, can be found on the website of OFCCP. It’s housed within the Department of Labor website which is www.dol.gov/ofccp. So there is a lot of compliance assistance, a lot of information, all these things that Director Leen has been talking about today can be found there.
Director Leen asked me to talk a little bit about certainty, and that’s something we’ve been working very hard on. One of the things recently, Secretary Scalia gave an address at the National Lawyers Convention. He addressed a number of very interesting topics, one of which was coming from private practice as he did, and as I did earlier this year, the issue of consistency of enforcement. The enforcement agencies in the Department of Labor, including OFCCP, are working very hard at enforcing the law consistently throughout the regions of the United States.
As Director Leen mentioned, we have six regions. Each one of them has a regional director, and each one of those offices has staff throughout the United States. So we’re working very hard on training our staff, our career people — we have wonderful career staff at the OFCCP — and making sure that they’re enforcing the law consistently throughout the United States. And we do that by a number of directives that Director Leen mentioned. Certainly, a lot of them are new in the last couple of years. We use those and follow those very closely. We do internal training of our staff, and we’re also reaching out to the contractor community and the legal community for suggestions. If you know of any issues that we should be addressing to make sure we’re enforcing laws consistently throughout the U.S., we want to work very carefully on that.
Some of the things we’ve implemented already this year, in conciliation discussions with our contractors, we have a list of factors that we now ask all of our staff to look at. And we’ve been circulating those, and we’re going throughout the United States being looking at cases consistently. A lot of the contractors that we enforce the law with are contractors that have locations throughout the United States in different regions, and each establishment that they have, we want to make sure that the law applies equally throughout the U.S.
So certainty and consistency are very important to us. It’s something we’re working very hard on these days. We’re also trying to have consistency in our agreements with the contractors that we reach, whether they’re conciliation agreements, early resolution conciliation agreements, or what have you. So these are all things we’ve improved on. We listen very carefully to the constituents. We take their feedback very seriously, and we implement and change as necessary to improve our service to the public at OFCCP.
Prof. Aram Gavoor: Thank you very much. Thank you, Craig. Before we open up to the callers for questions, I have two quick ones that I’d like to address. One is how does OFCCP differ from other civil rights agencies such as the Equal Employment Opportunity Commission and the Civil Rights Division of the Justice Department?
Craig Leen: I think in two ways. The first way is through these neutrally scheduled audits and the use of regression analysis. So look at company-wide or establishment-wide, their employment, their hiring, their compensation and promotion practices. Also, the affirmative action component; the EEOC and the Department of Justice are not looking at affirmative action. That’s something you have to agree to as a federal contractor by being a federal contractor. And that affirmative action, as I mentioned, is much different than the affirmative action like a university. The affirmative action we enforce is basically you have to be doing good faith efforts to expand your applicant pool to include -- if you have a low representation of women, to include women, to include minorities.
But what you can’t do is ever favor in hiring any of those groups. And in fact, we have had -- I will tell you, in about -- we’ve had over two dozen cases where we have made a finding on behalf of men or on behalf of whites, where whites were part of the discriminated against group. We had a case in the Southwest where there was discrimination in of favor of Hispanics against every other group, and whites were included in that group. So the main point I’m making here is I recognize that historical discrimination is typically against women and against minorities, and we recognize that, and most of our findings are consistent with that. But this is truly equal employment opportunity. Any group is benefitted by OFCCP because we are reviewing employment practices on behalf of all groups that we protect.
Robert Gaglione: This is Bob Gaglione speaking. One of the things that I found interesting when I came to work at OFCCP is that the EEOC, the agency or commission that enforces age discrimination, we do not at OFCCP. That’s just one of the few differences in the law and the legal authorities. Secondly, I would just add one thing is that one of the remedies that our agency could pursue is debarment of contractors, federal contractors, whereas EEOC does not have that remedy.
Craig Leen: That’s true. Yes, that’s a good point. The protected classes are different. For example, veterans is something that -- VEVRAA applies to federal contractors. It doesn’t apply generally. So that’s an extra protected class that we have. And as Bob mentioned, we don’t have age as a protected class because that has not been applied to federal contractors, although companies cannot commit age discrimination under the applicable statute, and that’s enforced by EEOC.
Prof. Aram Gavoor: One other question that I have: One thing that I noticed was on November the 25th this year, OFCCP issued a notice in the federal register that appeared to limit the data inputs that it would consider for its audits and enforcement work, and specifically EEO-1 Component 2 data. That’s generally a rare phenomenon where agencies will actually take limiting principle steps to constrain themselves from maximalist data intake.
Craig Leen: Yes. I thought that that was important that OFCCP not take that data. And I testified about this to Congress as well because the data wasn’t useful for what OFCCP does. The data was very general. It was showing pay disparities in several different groups, but it was done at a very high level where you couldn’t make a discrimination finding based on it. And I thought that for OFCCP to take this sort of data for every single federal contractor and have to evaluate it would be an extensive use of resources with very little benefit. What I would prefer to do, and what we are doing is we’re increasing the amount of audits that we’re doing. That’s the goal, to increase the amount of audits where we get granular data, data about specific employees that we can run our regression analyses and then make a finding.
So that was why we -- it’s not that we don’t care about pay discrimination. We care deeply about it. And in fact, it’s one of the principle aspects of our mission. But it’s very important, and I want to say this, it’s very important that we are not finding that because there’s a wage gap, we are assuming that every company is discriminating. That is not correct. In fact, that’s unlawful. Yes, there’s a wage gap, and there’s something that needs to be looked at. And it’s based on a number of factors, one of which is discrimination. And that’s where our agency comes in. We come in and we get the specific data, and we look at it, and we make comparisons. And if there’s an unexplainable disparity of more than two standard deviations, considering all of the legitimate factors, that’s when we take action, and that’s where we should be because that means that the company is doing something wrong, which is what justifies the use of federal expenditures to fix it.
Prof. Aram Gavoor: Thank you very much, Director Leen and Deputy Director Gaglione. I have a couple others, time permitting. One is what’s the biggest challenge that you have faced as director and as deputy director in your stewardship of the agency?
Craig Leen: Well, I will tell you when I started and I would go to conferences -- I don’t know specifically the amount I had. I think it was around 40 or 50 speeches to contractor groups, to stakeholder groups, to town halls, to different sectors of the economy. We just did a recent Native American town hall to Native Americans about implementing a Native American employment rights program. And what I’ve found when I do these, particularly to contractors, at least initially, was that many of them seemed to fear the agency. I don't know how else to say that. Like they would literally come up to me at the meeting at the beginning and they would turn around their nametag so that I wouldn’t know what company they were from.
And this was known in this area. People told me that this is the experience that I would have, that a lot of companies were afraid to interact with the agency under the fear that they would be targeted for an audit, particularly if they criticized the agency. And that was a significant concern of mine because half of what we do as an agency is provide assistance. And we want companies coming to us in advance, in good faith, to try to fix these issues and not feel that by doing that, they’re going to be subject to an audit.
So we did two things to respond to that. We issued what we call the Contractor Bill of Rights, or what’s also called what contractors ought to know or what contractors should know. And we actually boldfaced this that you could not be scheduled based on contacting our help desk or seeking compliance assistance. We separated the two completely. They weren’t combined to begin with, but we transparently told companies that they’re not connected. And then two, we published a methodology. And I want to be clear, the methodology doesn’t say if you call OFCCP or if you criticize us, then you’re going to be listed. So that was extraordinarily important to me, that transparency.
And then I go around and I tell companies contact us, contact us. We created an online helpdesk where companies, if they want to, they could still do it anonymously, but they don’t have to. And they can ask us questions, and we’ll respond. We also initiated and opinion letter program so that companies can seek information from us in advance and get a formal response from the agency that will state the agency’s position and basically create a safe harbor. If the company follows that opinion letter, they will be good. That’s what we want them doing. We want them coming to us. And if we give them -- if we tell a company to do something and they do it, they shouldn’t be in trouble for doing that. That’s what we want companies to do.
So we are always thinking about that because we know that a significant portion of what the agency can do, the way that it can project equal employment opportunity throughout the workforce is through compliance assistance, is through providing guidance, that multiplier effect. And that if companies are afraid of us, and they don’t interact with us, and they just basically say, “We’re not going to do that unless we happen to get audited,” which was a concern, that used to be a concern that companies were doing that, then it’s not going to work for our agency. We’re going to diminish the agency and its potential effect. So that to me was the most significant issue. What about you, Bob?
Robert Gaglione: Well, I was going to say there’s a great movie quote, “With great power comes great responsibility.” And here at the OFCCP, we work very hard at striking a good balance between compliance assistance and enforcement of civil rights laws. I think we’re getting it pretty good in this administration. I think we’ve done a great job under Director Leen. I’m not just expressing my own opinion. I hear that from contractors and lawyers and industry groups. But that’s what kind of keeps me up at night, making sure we’re getting it right. We have great power here. We want to enforce the law to the public interest as best as we can.
Craig Leen: Yeah, and then if I can -- the other concern I had, which is a concern I would think The Federalist Society would be interested in too is just how long the Administrative Procedures Act process takes to get judicial review of any sort of matter. So like I was saying, if the OFCCP can hold you in audit for several years without ever making a finding, and then there’s no duty to issue a preliminary determination or there’s no present duty under the regulations to issue a notice of violation, so you could go for years and then all of a sudden have a show cause notice, and then that goes to an administrative law judge, and that proceeding could take several years, then you go to an administrative review board at the Department of Labor, that could take a couple years. Then you get to an Article III court, that can take time too.
The point that that made to me, and I’m not challenging that process, I’m not speaking to that process, it’s just we have to recognize it’s a long process. So what’s important is that we embed much earlier in the process a form of administrative review that’s rigorous, and a focus of the agency on trying to resolve cases quicker. And to that end, and I’ve spoken about this publicly, we have -- we’re going to be issuing sooner preliminary determination notice rulemaking where we’ll get public comment on it. I’m looking forward to getting those public comments that attempts to address that issue.
And in addition to that, on programs like this, and I speak about this issue, we want companies engaging with the agency as soon as possible. And we want to share our findings with you as soon as possible, and then address them with you, have a way for the national office to review the findings and your response and create that sort of process in a rigorous way.
And then one other thing we’ve done, which I’m very proud of, and I know the Secretary of Labor has spoken about this as well, Mr. Scalia, Secretary Scalia, the ombuds process, the ombudsman that we have, Marcus Stergio, that we recently appointed. This was based on a directive from last year. We actually have an OFCCP ombudsman now who you can contact as a contractor who’s a neutral within the agency who will work with you to resolve administrative reviews that are taking too long, where you’re not getting sufficient information, where the agency’s not following the transparency directive, which hopefully is very rarely, if never. I mean, hopefully it’s never. But these things happen sometimes, or at least you may think that it is being violated, and you should be able to raise that in an appropriate way to get that issue resolved. So we have an ombuds person who’s going to help us get these cases moving quicker.
So I’m very proud about that too, and I would encourage anyone who’s an attorney on the line who represents a federal contractor, use the ombuds person. Our whole agency supports the ombuds person. The regional directors do. The district directors do. Use the ombuds person.
Prof. Aram Gavoor: Well, thank you very much. Greatly, greatly appreciate your comments. I’ll pass the floor back to Wesley.
Wesley Hodges: Wonderful. Well, Aram, I do have a couple of questions from the audience. Let’s go to our first caller.
Roger Clegg: Hi. This is Roger Clegg with the Center for Equal Opportunity. And thanks very much, Craig, to both you and Bob for your presentation. And I’m especially happy to hear, as I understand it, that you all will not be emphasizing the disparate impact approach. You’re interested in actual purposeful discrimination, and also that you’re not going to be requiring or even allowing the use of preferential treatment.
My question, though, is that as you know, the regulations that OFCCP has requires contractors to set goals and timetables whenever there is, quote, “underrepresentation,” end quote, of minorities and women in job categories. And even if you say that you’re not allowing or requiring preferences, if a company knows that goals and timetables are going to be triggered whenever they have underrepresentation, isn’t this inevitably going to lead them either before the underrepresentation occurs or after it occurs to put their thumb on the scale when they make hiring and promotion decisions so that they don’t have that underrepresentation? And if they’re putting the -- if they’re trying to avoid underrepresentation, isn’t that going to work in exactly the kind of discrimination that you all are committed to fighting?
Craig Leen: Thank you, Roger. It’s always a pleasure to get a question from you, and we’ve talked about this before. I will tell you on the issue that you’ve discussed, first of all, if a company’s doing a preference in hiring, and we audit them, we should detect that. And we do remedy that. You cannot do that. And we’ve been very clear with contractors about that. We’re going to be publishing additional guidance on that to make it clear, probably through FAQs or maybe through some sort of bulletin, but that they cannot favor in employment any group.
Actually, the only groups that you can have like a hiring program for are people with disabilities, veterans, and Native Americans on or near an Indian reservation. Those are the only groups that the law recognizes the ability to have a hiring preference. And there’s specific reasons for each of them.
But on the issues of race and gender, the law is clear that if you favor in employment a particular race or gender that that is discrimination. That’s unlawful. And if we detect that to more than two standard deviations, which we probably would if they’re doing a preference, or if we learn that through our investigation, we would make them correct that. They cannot do that. That is illegal.
On the issue of affirmative action generally, my own view is that there’s still a role for affirmative action where you see very low representation of certain groups to ensure that there’s not particular barriers to their employment. For example, sometimes -- and this is the area where you can sometimes have a disparate impact case that I would support because you ask us, yes, we are prioritizing disparate treatment because, for example, if you have a 100 pound lifting requirement, and we go in and we determine you haven’t validated that requirement, and in fact, it is having a disparate impact on people with disabilities, and let’s say also women, for example, it’s having a disparate impact on them. And so you’re having a lower hiring rate, and you’ve been doing your yearly reviews as a federal contractor.
I have no issue whatsoever going in there and telling that contractor, “Eliminate that 100 pound lifting requirement. It’s a discriminatory requirement. You have no need for it. And you should be detecting that in your yearly reviews. And the fact you haven’t provides scienter.” Now, do we need scienter? No. We’re going to make them fix that sort of requirement.
When people talk about disparate impact, what I think that they’re criticizing about the agency is that if we take up -- if we do a review of hiring practices generally based on compensation, and we find a disparity alone, and there’s no supporting evidence, and we just say, “Well, you know what, we don’t have to approve treatment. We can just say that your entire system, you’re entire hiring system is causing a disparate impact, and now you’ve got to fix it, even though we haven’t identified the policy or practice that’s causing it,” that’s where I think people criticize the agency. And in fact, that was an issue in the Analogic case which OFCCP lost.
And it’s something that we took to heart. And I told our agency, look, there’s two types of cases. There’s disparate treatment, which is our priority, fixing unlawful, intentional discrimination so it doesn’t happen again and so that we fix it going backwards and we fix it going forwards. That’s our focus. And then two, that in situations where there’s an identified policy or practice that is causing a discriminatory impact -- and remember, that can be more than two standard deviations. That could be a significant impact, and that that’s something they should be catching in their yearly reviews, then, yeah, of course, they need to fix that.
And really, in many ways, it merges disparate impact and disparate treatment because if you’re a federal contractor, you’re supposed to be reviewing your system every year, and you should detect that and fix it. And if you don’t, I have no problem fixing that. So that’s a general outline of my thinking. We are prioritizing disparate treatment cases, and we made that clear in the compensation directive. We basically said that unless there’s supporting anecdotal evidence of intent, we would require an exceptionally strong statistical finding to take action.
Roger Clegg: Wouldn’t it make sense, though, to change the regulations because, unfortunately, the day will come, Craig, when you aren’t the head of OFCCP, and it’ll be somebody that’s been appointed by Bernie Sanders or somebody like that. And they are going to abuse the requirement that there be goals and timetables whenever there’s underrepresentation of minorities and women. And so not only are the regulations, I think, illegal on their face because they’re providing protections to minorities and women that they aren’t providing to non-minorities and men, they’re also a loaded gun just waiting to be abused by a liberal administration who’s going to use those regulations to require goals and timetables to benefit, essentially, the quotas.
Craig Leen: Well, look, Roger, I’m not going to comment on other administrations. I’m hoping that any future administration, whenever that may be, will build on the good things that we’ve done in this administration, which I think these things make a lot of sense.
Roger Clegg: Make them more permanent by changing the regulations.
Craig Leen: So what we’re doing, Roger, is we are going to be issuing a preliminary determination notice of rulemaking, which I mentioned, where we’re going to be getting notice and comment which addresses some of these issues. So take a look at that and make a comment. That would be a really good place to make a comment if you’d like. And we welcome anyone to make a comment for or against it, or neutrally as well. And then I can formally consider that comment.
In addition, we are putting a lot of these principles into our federal contractor compliance manual, RFCCM, which we’re going to be issuing soon. We have issued these FAQs. We have these directives. We have this approach that’s been extraordinarily successful. I think that any administration would have to look at the number $40,569,816 dollars which is more than double any other year in any other administration. The only other number that was basically more -- maybe there was one other was around there, but it’s about double the recoveries in any other administration for a given year. And the second highest year was in this administration.
So I think they’re going to have to take a hard look at this approach, which is much more -- which is a practical approach, which focuses on engagement with business and trying to work out problems quickly, and focuses on wrongdoers, and makes sure that those that are not doing something wrong or want to do it right get it right quickly and enterprise-wide. I think they’re going to have a hard time, anybody, moving away from this approach, or it’ll be less successful, in my opinion.
Roger Clegg: Thank you very much, Craig. I really appreciate it. And I may have missed it, but when did you say the NPRM -- is there a particular date that it’s scheduled for, or is it sometime in 2020?
Craig Leen: I don’t fully control that, but it should be soon. That I can say. It should be soon. I’ve been talking about it for a while now, and it should be very soon.
Wesley Hodges: Thank you, Roger. We do have one more question in the queue. Here is our second caller.
Paige Smith: Hi, Director Leen. This is Paige Smith from Bloomberg Law. I just have a quick question regarding the program you mentioned a bit earlier that would allow companies to turn over, I believe that you said it was their inclusion programs for consideration by the agency, and then there would be a process of considering whether that contractor would be removed from the neutral scheduling list. Could you explain that program a bit more and perhaps elaborate on whether there is a timeline for the release of that NPRM?
Craig Leen: Yes, of course, Paige. And it’s good to speak to you. What I’m talking about is the VERP directive, which I issued, and an information collection that should be issued very shortly where we’ll get notice and comment. And it’s consistent with what the VERP directive said, and I’ve publicly spoken about this before, but it’s basically a way for companies that have a history of compliance, so they would have had to have gone through reviews in the past, but a history of compliance, and they’re willing to agree to -- and there’s a number of factors we look at, including inclusion programs, the history of compliance, and other factors which we’re going to receive comment on so we’re open minded on.
But these are the factors they would be able to apply and be put into a separate group of companies that would do a periodic reporting requirement to the agency where they’d have to give us a report. There may be sampling involved of certain establishments of that company with the goal of focusing our neutrally scheduled audits on more likely violators, which is what the Government Accountability Office asked us to do.
We’re doing that both through this program and then also through -- you probably -- I know you saw this, Paige, but in our most recent methodology, we focused on industries that had the highest rates of violations that’s found by the agency over the last five years. We’re looking to include similar neutral factors like that in future scheduling lists. So it’s both that we’re removing the unlikely violators and focusing on the likely violators that we’re going to meet that goal by the Government Accountability Office.
But I want to be clear, the VERP program is still a rigorous program. There is a rigorous reporting requirement. And we don’t anticipate that a lot of companies would likely do this program. It will probably be the top of the top, the ones that are really doing comprehensive compliance with equal employment opportunity across the board. So that’s the idea.
Paige Smith: Is there a timeline for when that information collection should be?
Craig Leen: Very soon. That’s all I can say.
Wesley Hodges: So Aram, I turn the mike back to you. Do you have any closing thoughts or questions you’d like to ask before we wrap up?
Prof. Aram Gavoor: No more questions to ask, but our sincerest thanks to The Federalist Society and also to Director Leen and Deputy Director Gaglione for putting on and also participating in this teleforum.
Craig Leen: Thank you so much. It was such a pleasure.
Robert Gaglione: I really enjoyed it. Thank you very much.
Wesley Hodges: It really is our pleasure. And on behalf of The Federalist Society, I would like to thank you all for the benefit of your valuable time and expertise. We welcome all listener feedback by email at firstname.lastname@example.org. Thank you all for joining us for this call. We are now adjourned.
Operator: Thank you for listening. We hope you enjoyed this practice group podcast. For materials related to this podcast and other Federalist Society multimedia, please visit The Federalist Society's website at www.fedsoc.org/multimedia.