Government Contracts Monitor

Federal Contractors Officially Come Into the 21st Century

March 9, 2015

1970. Ford produced its first Pinto. Ronald Reagan was re-elected governor of California. Claudia Schiffer was born. The Kansas City Chiefs won the Super Bowl. And the current Federal Sex Discrimination Guidelines (Guidelines) were written. At the time, no one could have imagined that the Pinto would develop a reputation as one of the worst cars ever made, Reagan would be elected the 40^th President of the United States, Schiffer would become an international supermodel and the Kansas City Chiefs wouldn’t return to the Super Bowl for at least 40 years. Nor could they have reasonably believed that the old Guidelines, which apply to federal contractors working in the United States with contracts valued in excess of $10,000, would still be in place forty-four years later. That is about to change.

Given the cultural sea change since 1970, it’s hardly surprising that the 1970 Guidelines are anachronistic and fail to reflect the realities of the workplace in the 21^st century. Attempting to remedy this problem, the Office of Federal Contract Compliance Programs (OFCCP) issued a Notice of Proposed Rulemaking on January 30, 2015, seeking to replace the Guidelines with regulations that “align with current law and legal principles and address their application to current workplace practices and issues.”

The proposed rules align OFCCP’s standards with Title VII and amendments thereto, including those made by the Equal Employment Opportunity Act, the Pregnancy Discrimination Act, the Civil Rights Act of 1991 and the Lilly Ledbetter Act of 2009. OFCCP proposes deleting out-of-date provisions, including paternalistic protections for women under which an employer could discriminate against a woman “for her own good” in certain occupations, such as those that may pose reproductive health hazards. In eliminating such “protections,” the proposed rule implicitly acknowledges that women are able to conduct their own risk-benefit analyses of their employment options.

The proposed rule’s recognition that sex-based discrimination includes not only gender-based discrimination but also sexual identity and sex-based stereotypes is another leap into the 21^st century. Notably, the proposed rule adds protections for transgendered employees regardless of whether the employee has undergone or plans to undergo gender reassignment surgery. Likewise, the proposed rule prohibits discrimination against men or women who fail to conform to gender stereotypes regardless of gender identity or sexual orientation. Based on the proposed rule, a contractor may not treat unmarried men and women differently, thereby addressing anachronistic stereotypes that bachelors are enviable playboys, while unmarried women are “old maids.”

The proposed rule’s protections for pregnant women have also increased partly in response to both the greater percentage of pregnant women working and their doing so through their last month of pregnancy. Between 1966 and 1970, only 39% of working pregnant women continued their employment into their last month of pregnancy; in comparison, from 2006 to 2008, the percentage of employed pregnant women working through their final month of gestation was 82%. The changes not only prohibit discrimination based on pregnancy and childbirth, but also prohibit practices that may dissuade pregnant women from working. Such changes are among the ways the proposed rule recognizes that disparate impact discrimination is not limited to the hiring process, but may result from the failure to provide appropriate facilities to men and women. In a particularly colorful example, OFCCP’s Notice of Rulemaking highlights “an employer policy requiring crane operators to urinate off the back of the crane instead of using a restroom,” as a practice that would discriminatorily disparately impact women.

These examples represent only a sample of OFCCP’s proposed changes to the Guidelines. Given the scope of the overhaul, one might expect the estimated cost of implementation to be significant. OFCCP thinks otherwise, and estimates minimal costs associated with the proposed rule because it is intended merely to align with existing laws rather than to create or implement new standards. In fact, because the proposed rule only seems to adopt existing laws and policies, contractors already likely operate in compliance with the proposal.

The public may submit comments on the proposed rule until March 31, 2015 by visiting this website. However, given that the proposed revisions are not only long-overdue, but also consistent with existing law and impose a minimal economic burden, it seems likely that the majority of the proposal will become final. Accordingly, federal contractors with grants in excess of $10,000 would benefit from ensuring compliance with title VII by reviewing and updating as necessary, existing policies and informal practices related to their treatment of men, women and transgendered individuals in the workplace.