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2. The information in this PowerPoint and related presentation
is for general informational purposes only. These materials
and the presentation are not intended to provide legal
advice and do not establish an attorney-client relationship
where none currently exists.
This material may not be copied, reproduced, or used
without permission of the author.

3. Represents management exclusively in every aspect of
employment, benefits, labor, and immigration law and
related litigation
Over 700 attorneys in 51 locations nationwide
Current caseload of over 5,000 litigations and
approximately 300 class actions
Founding member of L&E Global
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4. Using specially designed proprietary software, our diverse
practice group of 40 lawyers and paraprofessionals
prepares over 2,200 affirmative action plans (“AAPs”)
annually for our federal contactor clients. We defend
against the imposition of citations and allegations of
discrimination in connection with audits by the Office of
Federal Contract Compliance Programs (“OFCCP”) and
offer liability avoidance services, including vulnerability
audits and statistical analyses employing the methodology
used by the OFCCP to identify potential discrimination.
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5. New Compensation Directive 307
Criminal Background Checks
Good Faith Efforts to Recruit Veterans and
Individuals with Disabilities
Hiring Cases: The Agency’s Bread and Butter
Steps To Take Now To Proactively Prepare

6. Pay equity initiatives at OFCCP are not
new…remember these . . . ?
Glass Ceiling Initiative
The DuBray Analysis
Compensation Standards and Voluntary
Guidelines
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7. President Obama’s Equal Pay Task Force
o The Obama Administration’s National Equal Pay Enforcement
Task Force includes the DOL (OFCCP), EEOC, the Department
of Justice and the Office of Personnel Management designed to
address issues of pay inequity
Lilly Ledbetter Fair Pay Act
Paycheck Fairness Act (proposed)
OFCCP recently announced the hiring of a labor
economist!
In short, your pay processes are under a microscope!
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8. The Persistent “Wage Gap” Between Men and
Women
o Top-down direction to enforcement agencies to find
new tools in the “tool box” to correct this “wage gap”
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9. Settlements for alleged discriminatory pay are on the
rise. . .
o FY 2008 – 0 pay settlements
o FY 2009 – 2 pay settlements
o FY 2010 – 10 pay settlements
o FY 2011 – 27 pay settlements
o FY 2012 – 32 pay settlements
Mostly from individual or small group findings
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10. OFCCP rescinds 2006 Standards and
Voluntary Guidelines…
Issues “Game-Changing”
Compensation Directive
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11. Highly Coordinated Roll-out
o Rescission of 2006 Standards and Issuance of
Directive 307
o Webpage:
www.dol.gov/ofccp/regs/compliance/CompGuidance/
o FAQs and Fact Sheet
o Press release and blog by OFCCP Director
o Immediate Field Training
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12. Directive 307 is not a regulation. See United Space
Alliance, LLC v. Solis (D.D.C. 2011).
o It is not law. It is considered “persuasive authority” in
court…meaning courts are not bound to follow it
o Directives are not subject to the Paperwork Reduction
Act, so there is no notice and comment period, nor is
there review or approval by the U.S. Office of
Management & Budget (“OMB”)
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13. Effective as of February 28, 2013, the date of publication
o 2006 Standards govern “issuance of systemic discrimination
NOVs” in reviews scheduled, open or pending on 2/28/2013
o Directive 307 applies to
(1) all reviews scheduled on or after 2/28/2013 and
(2) all pending reviews to the “extent not inconsistent with the
Standards”
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14. OFCCP will use a variety of statistical and non-statistical tools on a case by case basis
o Multiple regression
o Fisher’s Exact
o Cohort analysis
o Anecdotal with statistics
o Anecdotal without statistics
o Statistics without anecdotal
OFCCP wants to investigate total compensation
o Incentive Pay, Commissions, Overtime, Shift Differentials, Vacation and Holiday Pay, and
Benefits
OFCCP wants to look at issues that impact pay
o Promotions, Performance Review Process, Training, Job Steering, Glass Ceiling
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15. 1. Conduct Preliminary Analysis of Summary Data (if necessary or appropriate)
2. Conduct an Analysis of Individual Employee-Level Data
3. Determine Approach from a Range of Investigative and Analytical Tools
4. Consider All Employment Practices that May Lead to Compensation
Disparities
5. Develop Pay Analysis Groups
6. Investigate Systemic, Small Group and Individual Discrimination
7. Review and Test Factors before Accepting the Factors for Analysis
8. Conduct Onsite Investigation, Offsite Analysis, and Refinement of Model
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16. Step 1 - Preliminary Analysis of Item 11 Data
o Must submit by job group or salary grade/band or OFCCP will request
individual data
o Snapshot for compensation must be date of organizational profile
o Triggers used by OFCCP are currently unknown, appears to be pass/fail
o Qualitative Factors
o Quantitative Factors
• Size of overall average pay differences
• Largest pay difference
• Number of employees affected by average pay difference
• Number of job groups or grades where average pay differences exceeds
certain threshold
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17. Step 2 – Request Individual Compensation Data
o Requests will be similar to current 12-factor requests
o Most likely for entire workforce at establishment
o Must submit data electronically
o Information regarding factors impacting pay and pay policies
o Examination of practices affecting compensation
• Work assignments
• Training
• Job classifications
• Promotions
• Preferred shift or overtime work
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18. Step 3 – Group individual data into groupings of OFCCP’s choosing
o Case by case approach to analyses - seeking to identify “measurable
differences” in pay on the basis of protected traits between employees
who are “comparable” under the contractor’s pay system
o No more SSEGs – group into “pay analysis groups”
– Groupings at discretion of CO
– BEWARE - May cross job title, group, grade, band or level
– Will control for dissimilarity in jobs in statistical analysis rather
than in groupings
o No need for anecdotal evidence
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20. Step 4 - Review and test factors impacting pay
o Factors used in analysis will be determined by OFCCP
o May remove factors if:
• not represented by accurate and complete data
• not identified as a factor impacting pay in written policies
• not fairly implemented
• not consistently applied
• not statistically correlated with pay
• have adverse impact
o If factor has adverse impact, OFCCP will determine whether the issue is one of
disparate treatment or impact
o If disparate impact, OFCCP will seek data regarding (1) validity and (2)
consideration of alternatives with less impact
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21. Step 5 – Refinement of model
o Onsite investigations and interviews
o Offsite data analysis
Key Questions
1. Will the agency keep looking until it can explain all measurable pay
disparities for comparable positions?
2. When the will agency stop?
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22. Inconsistent results among locations of same contractor
Aggressive pursuit of much broader audits of
compensation practices
Multiple refinements of data
Significant increase in costs to defend audits
Significantly reduced ability to predict compliance
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23. Do your homework
Share your homework with legal and compensation teams
Review currently-approved scheduling letter and OFCCP initial requests
carefully
Review written pay policies
Review and strategically revise current AAP job group structure
o Are you using EEO-1 categories?
o How big are your job groups?
o Are you grouping employees who are similar or dissimilar in terms of pay?
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24. Validate processes that impact pay
Improve your recordkeeping about pay factors
Conduct self-analyses of pay under privilege
o Use model that makes sense for your pay system
o Consider reviewing total compensation
o Decide when and if you will share your self-analyses with the OFCCP
o Anticipate but do not match OFCCP’s approach
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25. Adopts EEOC’s new guidance on criminal background checks
o Individualized assessment of job-relatedness of conviction to the job for which the candidate
applied
o Where disparate impact occurs, employers must validate their criminal background check
policies
What to Do
o Ensure use of criminal history is job-related and consistent with business necessity
o Tailor criminal history screens to the situation
o Periodically conduct adverse impact analyses of criminal history screens - if adverse impact
occurs, consider validation or changes to the company’s approach to criminal conduct
exclusions
o Train staff on how to use and interpret criminal history information
o Review applications for “ban the box” implications
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26. OFCCP is now aggressively scrutinizing employer’s good faith
outreach efforts to the female, minority, veteran, and disabled
communities
Employers must be able to demonstrate a commitment to outreach.
Employers who appear to have just gone through the motions will
face greater scrutiny
OFCCP now regularly demands detailed information on how many
applicants were referred by diversity recruitment sources and of
these, how many were interviewed, hired, etc.
If OFCCP finds the contractor was deficient in recordkeeping and/or
outreach, the Agency will issue technical violations
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27. In the past, the OFCCP focused on goals and good faith
efforts to address areas of underutilization.
Then, the agency began to focus more on adverse
impact trends (especially applicant-to-hire adverse
impact)
o Traditionally, analyzed how minorities and females fared in the
employer’s hiring process as compared to Whites and males
Now, the agency is following the numbers
o “Reverse” adverse impact
o Sub-minority adverse impact
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28. 4 Traditional Analyses
8 “All Other” Analyses
20 “Sub-Minority” Analyses
That’s 32 ways to trigger in each job group!
Take a moment to think about how many job groups you have…
If you have ___ job groups, the OFCCP will run:
o 5 job groups: 160 analyses
o 10 job groups: 320 analyses
o 15 job groups: 480 analyses
o 20 job groups: 640 analyses!!
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29. Affirmative Action is really “Proactive EEO”
o AAPs should be strategic tools to identify and address “hidden
barriers” to EEO
o Don’t wait for audits; that’s too late
Privileged pay equity analyses
Conduct mock audits
Perform sub-minority analyses
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30. Use strategic disposition codes that identify the step and reason
each candidate “fell out” of your hiring process
Reevaluate use of pre-employment screens
Ensure that you are posting jobs with state
Document and audit all good faith efforts and develop relationships
with referral organizations
Audit reasonable accommodation procedures
o Online accessibility
o Leave and accommodation examples
Prepare AAP packet to send to OFCCP that includes items you
know they want to see
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31. Thanks for attending!
Lynn A. Clements
Jackson Lewis LLP
Lynn.Clements@jacksonlewis.com
(410) 415-2009
MAXIMUS Inquiries:
businessandtaxcredit@maximus.com
Kitty Leggieri: (410) 949-7377
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