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Jenny Yang Sees Pay Equity as a Top Federal Contracting Priority

March 15, 2021, 2:52 PM

The Labor Department’s federal contractor compliance watchdog will prioritize equal pay and workforce diversity efforts, in line with White House priorities, OFCCP Director Jenny Yang told Bloomberg Law.

The DOL’s Office of Federal Contract Compliance Programs has “unique and powerful” authority to address systemic racism and pay discrimination in employment settings, while promoting proactive compliance among federal contractors, according to President Joe Biden’s recently-named director.

“I can tell you that I’m very committed to working to close the existing racial and gender pay gaps,” she said in an exclusive interview. “We haven’t made any decisions yet on our approach but we are looking very carefully at our authorities.”

Yang held the top role at the Equal Employment Opportunity Commission during the Obama administration, where she spearheaded the collection of pay data from private employers as a method of addressing systemic gender and racial pay gaps. Since her selection to lead the OFCCP, observers have been waiting to see how the civil rights veteran will take charge at the agency, given the nation’s current reckoning with systemic racism and disparities exacerbated by the Covid-19 pandemic.

On his first day in office, Biden signed a cluster of executive orders that established whole-of-government push for racial equity. Yang said the OFCCP has a significant role to play in advancing Biden’s pledges—especially as the country recovers from the pandemic.

“As we focus on the recovery, we do believe federal contractors have a powerful opportunity to make substantial progress in ensuring equity for all workers, to ensure all communities are included in the recovery,” she said.

Pay Equity

Labor secretary nominee Marty Walsh is awaiting likely U.S. Senate confirmation. Once he’s in his role, Yang said, his experience with equal pay efforts, including collecting pay data, as the mayor of Boston can be informative for the OFCCP.

Walsh partnered with the Boston Women’s Workforce Council to launch an effort to collect de-identified racial and gender salary data from more than 250 Boston-area employers, who voluntarily participate.

Yang said she’d like to learn from those efforts, and how having the ability to benchmark pay gaps can help to close them.

“We’re excited to build on that work and move our pay equity work forward,” she said.

Before the EEOC proposed collecting pay data from private employers, the OFCCP collected compensation information from federal contractors as part of an Equal Opportunity Survey, which was discontinued during the George W. Bush administration. The contract compliance office again tried to require contractor pay reports during the Obama administration but ultimately dropped the effort, and the EEOC took up the collection.

Enforcement Ahead

Bias prevention is another area Yang has her eyes on. Last year, the OFCCP lost a high-profile pay discrimination lawsuit against Oracle America Inc., when an administrative law judge knocked out the agency’s claims that the Silicon Valley tech giant owed women and minorities $400 million in lost pay.

DOL lawyers urged agency leadership to appeal the decision, but they opted not to do so.

“We do not believe the Oracle decision accurately applied Title VII standards,” Yang said, referencing a section of the 1964 Civil Rights Act. The OFCCP enforces Executive Order 11,246, which mirrors Title VII and is similarly rooted in anti-discrimination principles.

The Obama administration OFCCP was more active than its Trump successor in suing federal contractors after allegedly uncovering violations of anti-bias laws. The agency sued at least six federal contractors during the last week of the Obama administration, while the Trump’s OFCCP sued three contractors over the entire four years.

“As we move forward, where we find evidence of compensation inequities, we will be working to develop a strong record, relying on all the evidence to enforce the law and remedy” violations, she said.

It’s easier to identify a problem that’s disadvantaging a particular group, Yang said.

“It can often be a lot harder to understand what it will take to fix that problem and make it stick over the long-term,” she said. “I’m very interested in the kind of conciliation agreements that we enter into including the kind of practice changes that will truly work to bring long-standing advances in opportunity.”

The goal is to not see the same problem every few years when evaluating a contractor for compliance, she said.

Interagency Collaboration

The EEOC and OFCCP enforce similar workplace anti-discrimination laws, and Yang anticipates they will work closely, while also working with other federal agencies. The contractor compliance office signed an agreement with the commission and Justice Department in November.

One area on which the EEOC and OFCCP are already collaborating is workforce diversity training, according to Yang. Biden rescinded a Trump-era executive order that banned training workers on topics like “White privilege,” and Yang thinks that the residual chilling effects of the order may linger.

“We are collaborating with the Equal Employment Opportunity Commission on an effort to understand both the research and practice in this space to provide resources for the employer community, as well as workers,” Yang said.

The White House’s recently established Gender Policy Council, which is tasked with advancing gender equity and equality, including in the workplace, is likely to be another partner, Yang said, adding she’d be “eager to participate” with the council.

The OFCCP is positioned to address “long-standing” workplace inequities, Yang said, and she’s optimistic about the agency’s future.

“We’ve seen many employers, including leading contractors, make powerful commitments to advancing equity, and particularly recognizing the role of practices and structures in perpetuating bias and inequity,” she said.

To contact the reporter on this story: Paige Smith in Washington at psmith@bloomberglaw.com

To contact the editors responsible for this story: Andrew Harris at aharris@bloomberglaw.com; Jay-Anne B. Casuga at jcasuga@bloomberglaw.com

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