We have been receiving a lot of questions since the revocation of E.O. 11246, and the majority of them can be boiled down to, “What do we do now?”
One project that should get off the ground as soon as possible: Get a handle on your state and local Equal Employment Opportunity/Affirmative Action (EEO/AA) obligations, because the compliance landscape just got a lot more complicated. Whenever there is a significant “void” in the law at the federal level, we have seen time and time again that the various states will and do rush in to fill that void.
Compensation discrimination and pay transparency are a handy, recent example. Pay discrimination on the basis of sex or race was made illegal on the federal level over 60 years ago with the passage of the Civil Rights Act in 1964, followed quickly by the emergence of E.O. 11246 the following year. But the Civil Rights Act merely gave employees an avenue to sue employers if/when compensation discrimination took place. The OFCCP could be more proactive under E.O. 11246 and investigate possible compensation discrimination in audits, but didn’t really ramp up those efforts until this century.
So, when the spotlight swung to compensation discrimination and pay equity issues about ten years ago, it was various states, not the federal government, that stepped up with new laws, regulations, and requirements for private employers. Unfortunately for those employers, most of which wanted to find ways to mitigate their legal risk and ensure that pay discrimination was not occurring, they faced a hodgepodge patchwork of different requirements depending on whether they had operations in or contracts with different jurisdictions. Each state approached pay equity their own way, and employers still yearn for a universal solution.
State and Local EEO/AA is Complex
When it comes to employment nondiscrimination generally, various states, cities, and counties have implemented their own E.O. 11246-like requirements over the years. But the vast majority of these requirements were based on the federal model, so federal contractors did not face an unmanageable patchwork of laws and regulations—their E.O. 11246 reports and analyses could most often pull double duty and satisfy most state or local requirements they might have.
But compliance with E.O. 11246 is no longer required, leaving only the patchwork behind to fill the gap. And the general consensus is that we may see more state and local EEO/AA requirements added to the books in the coming months and years, not a rollback. Before, states could largely rely on E.O. 11246 to ensure that at least federal contractors were working hard to ensure non-discrimination in an organized way, and therefore did not need to pass their own duplicative laws. Without E.O. 11246 on the books, states that don’t have their own protections will look at the need to implement them.
Keeping track of these requirements in the various states is extraordinarily difficult. Factor in that major cities in each state might have their own requirements and the task gets even harder. Then, factor in that counties might have separate requirements, and the task becomes virtually impossible.
What To Do Now
Every employer needs to review the extent to which they may operate in a jurisdiction with EEO/AA requirements, or hold contracts with states, cities, or counties that do. And unless they have a small army of researchers, employers will need help making sure they are meeting all of these various requirements now that they cannot rely on E.O. 11246 efforts to keep them compliant.
That is where Berkshire can help. We can help you determine where your organization “operates” because we already have a trove of your employment data and can largely take that part of the project off your plate. And once we have your internal survey of state and local contracts, we can do the heavy lifting of mapping out the specific requirements your organization now has to meet, and formulate a plan for how you are going to meet them.
Because current state and local requirements were largely based on the federal model, your current E.O. 11246 reports and analyses may continue to suffice. That is why we are encouraging our clients to follow through on their 2025 “AAPs”, especially during the 90-day period where all federal contractors are expressly permitted to continue to follow the requirements of E.O. 11246. If your AAP start date is before April 21, 2025, you can complete your 2025 AAP project like you normally would within the “safe harbor” period provided in Trump’s Executive Order 14173.
After that, to satisfy state, county and local requirements, you will need to develop a plan to be able to respond to each unique requirement. In many cases, we think it’s likely that the workforce analytics you prepared under E.O. 11246, or something very similar, may still be what you need to prepare to comply with state and local requirements. Berkshire has the expertise and ability to provide what you need as you navigate this new patchwork of requirements to ensure your organization can maintain its contracts with state and local governments.
Looking Ahead
We understand that people are being inundated with information and advice right now, much of it unhelpful, and some of it questionable. That is why Berkshire is proceeding carefully and thoughtfully. We may not be the first one in your inbox, but ours are the ones you should be on the lookout for.
We cannot stress enough how important it is for your organization to get a handle on this, though. Get started today. Let your organization know that the recission of E.O. 11246 does not mean that they can rest on compliance, and assure them you are on top of what has to happen next. Then marshal your resources and make your state and local contract survey a priority.
Together, we will chart a safe course through these turbulent waters.
In the meantime, if you have any questions, feel free to reach out to us at bea@berkshireassociates.com. We are here for you.