New OFCCP Directive on Transgender and Gender Identity Status

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On August 19, 2014, OFCCP finally issued a Directive on Gender Identity and Sex Discrimination that clearly acknowledged that gender discrimination under Executive Order 11246 covers discrimination on the basis of transgender and gender identity status. Regular readers of this column may recall my January 2014 article in which I reported a headline from a December 4, 2013 Buzzfeed.com post that read, "Federal Official Refuses to Say Whether Office is Protecting Trans Workers." Apparently, the only response the agency was willing to offer at that time was a reiteration that "OFCCP follows Title VII precedent in everything." This was essentially an invitation for the reader to review Title VII case law and figure it out for him or herself.

The purpose of my January article was to shed more light on the subject. I recommended, among other things, that OFCCP clearly acknowledge that it protected transgender workers. Specifically, after explaining the EEOC position in Macy v. Holder (EEOC Appeal No. 0120120821, April 2012), I stated:
  • As noted by OFCCP, it is obliged to follow Title VII precedents in its enforcement of Executive Order 11246. EEOC is the lead Federal agency on employment discrimination. Under Executive Order 12067 it is charged with coordinating federal enforcement in this area to ensure consistency in interpretation of EEO law across the Federal Government. Ensuring a consistent interpretation of what constitutes discrimination on the basis of sex surely falls under this responsibility. Thus, sex discrimination under the Executive Order should be read to include discrimination on the basis of transgender status. So the answer to the question of whether OFCCP protects transgender workers should be a clear, straight forward "yes." Hopefully, when OFCCP issues new guidance on sex discrimination it will make this point clear.
In contrast to its December 2013 response and as I urged in January, OFCCP's new directive clearly states that the laws enforced by OFCCP protect transgender workers. The policy provision states:
  • POLICY: In accordance with Macy v. Holder and the Title VII case law on which it is based, OFCCP continues to fully investigate and seek to remedy instances of sex discrimination that occur because of an employee’s gender identity or transgender status. OFCCP continues to accept and investigate individual and systemic complaints alleging sex discrimination against transgender employees. In the case of individual allegations of gender identity discrimination, and pursuant to the Memorandum of Understanding between EEOC and OFCCP,8 OFCCP will request that it initially retain such complaints to ensure effective enforcement of this Directive. OFCCP continues to seek to remedy any findings of sex discrimination against transgender employees that are discovered by OFCCP compliance officers during scheduled compliance evaluations of federal contractors or subcontractors. When investigating whether a federal contractor or subcontractor discriminated against an employee because of his or her gender identity, the agency continues to adhere to the existing Title VII framework for proving sex discrimination, as outlined in the FCCM.
In saying it will continue to fully investigate and seek to remedy transgender and gender identity discrimination, OFCCP frames this new guidance as a simple continuation of an ongoing policy and practice. If that is the case, it is not at all clear why OFCCP demonstrated reluctance to clearly answer "yes" to the Buzzfeed inquiry in December. A simple yes, OFCCP protects trans-workers, would have been more consistent with an ongoing practice of extending such protections.

The fact of the matter is that OFCCP does not get many, if any, of these kinds of complaints. OFCCP does not cite any OFCCP decisions on transgender and gender identity in its Directive. In addition, I could not find on DOL's website any reference to a case where OFCCP actually "sought to remedy" transgender discrimination. Reading this policy statement one might think that OFCCP compliance officers are very familiar with these kinds of cases and that there is a meaningful body of OFCCP decisions on this issue. Neither is true.

In the normal course of business OFCCP refers individual (as opposed to class) complaints to the EEOC for processing. The Memorandum of Understanding (MOU) referred to in the excerpt above provides for individual cases to be referred to EEOC unless OFCCP requests to retain them. Specifically, the MOU states:
  • c) Individual Allegations -- OFCCP will refer to EEOC allegations of discrimination of an individual nature on a Title VII basis in dual filed complaints/charges. However, in appropriate cases, OFCCP may request that it retain such allegations so as to avoid duplication and to ensure effective law enforcement.
The new policy directive includes a blanket request to retain transgender and gender identity cases. OFCCP asserts that it is making this request to assure effective enforcement of the Directive. This basically means that they are keeping these cases because they want to keep them. EEOC is perfectly capable of handling individual transgender and gender identity discrimination cases if OFCCP chose to refer them. OFCCP and EEOC have an interesting relationship when it comes to the distribution of cases that could be brought in either forum. Transgender and gender identity discrimination is fairly new territory compared to the traditional bases and neither agency is going to yield the field entirely to its sister agency. It appears that both EEOC and OFCCP want a piece of the action. So whichever door you walk in, that agency will keep the case.

Of further note in this Directive is the distinction it suggests between transgender and gender identity discrimination as a form of gender discrimination, and transgender and gender identity discrimination as a stand-alone category. OFCCP states that:
  • Consistent with Macy and the Title VII case law on which it is based, this directive deals with discrimination on the basis of gender identity only as a form of sex discrimination. It does not address gender identity as a stand–alone protected category, which (along with sexual orientation) is the subject of Executive Order 13672. As noted above, Executive Order 13672 amends Executive Order 11246 effective immediately, and will apply to contracts entered into on or after the effective date of the implementing regulations.
This raises the obvious question (now famous in another context), "What difference does it make?" If transgender and gender identity discrimination is a form of gender discrimination, what difference does it make that it is also now a stand-alone category? From a political perspective, creating a stand-alone category highlights the government's commitment to this issue more directly and satisfies the constituents who have pushed for this addition to Executive Order 11246. From a legal perspective, on the issue of discrimination it appears to be a distinction without much of a difference. It simply allows the case to go forward without having to stop and explain how it fits into gender discrimination. The greatest legal impact of the Executive Order amendments making transgender and gender identity status a "stand-alone" category may come in the introduction of affirmative action program plan requirements for those specific categories when OFCCP promulgates implementing regulations for the amendments.

What can Federal Contractors expect from OFCCP?
Following are my predictions for what contractors can look forward to from OFCCP in this area:
  1. OFCCP will actively look for transgender and gender identity cases in reviewing Federal Contractors.

  2. Transgender and gender identity cases will be given a high profile. In other words, they will likely be given press and be talked about in OFCCP presentations.

  3. OFCCP will handle the affirmative action piece under the new amendments to Executive Order 11246 and not simply read affirmative action on the basis of transgender and gender identity into the current gender-based affirmative action requirements.

  4. OFCCP will have to provide training to familiarize compliance officers both with the legal requirements inherent in transgender discrimination and on how to interact appropriately with potential victims. (Compliance officers will still so rarely come across this issue that they will need a refresher when they do.)

  5. Compliance officers will still be learning on the job so Federal Contractors will need to be familiar with how non-discrimination works in the transgender and gender identity arena so that they can help compliance officers get it right and avoid unnecessary violations.

  6. Federal Contractors will not likely see a huge volume of transgender cases because of the size of the transgender Federal Contractor workforce.

  7. OFCCP may actively recruit individuals with expertise in this area and in this category for its enforcement staff.

  8. OFCCP will initiate or further expand its outreach and education campaigns into the transgender and gender identity community which may stimulate the generation of complaints or may result in the identification of contractors with whom individuals have encountered alleged discrimination issues.

  9. When OFCCP finally promulgates new regulations under the Executive Order amendments, OFCCP will likely need to coordinate enforcement efforts with EEOC. The amendments to the Executive Order give OFCCP jurisdiction over any affirmative action program plan obligations of Federal Contractors. Thus, if EEOC transgender cases involve respondents who are Federal Contractors, OFCCP will likely want to investigate their compliance with any affirmative action requirements OFCCP establishes. EEOC, on the other hand, can seek compensatory and punitive damages and OFCCP cannot. In harassment complaints or other complaints that do not involve a loss in position or pay, OFCCP's remedies provide more of a threat to the contracting relationship than relief to the individual victim. In other words, each agency can offer a slightly different set of enforcement procedures in these types of cases. The government will probably want to maximize the use of all of the tools of both agencies which is not always easy or feasible.

  10. OFCCP will probably include specific goals related to transgender and gender identity issues in its internal operational plans.
Summary
OFCCP's new Directive on Gender Identity and Sex Discrimination finally provides a straightforward answer to the question I discussed in January: whether OFCCP protects trans-workers. The framework in which this new Directive is presented, however, is not nearly as straightforward. Someone unfamiliar with OFCCP enforcement may walk away from this Directive thinking that OFCCP handles cases of this type all the time and will simply continue to do so. They would be mistaken.

There is no shame in admitting that OFCCP just does not see that many cases involving transgender and gender identity status. The Macy case was only decided in 2012. It had been a matter of debate for sometime before that whether Title VII even reached this issue. Given the evolving state of the law in this area and the fact that OFCCP traditionally does not handle cases of individual discrimination that are cognizable under Title VII, it is not surprising that OFCCP does not have a strong track record in this area. It really has not had much opportunity to develop one. The policy guidance, in my view, creates an impression that overstates the extent of OFCCP's experience and activity in this area. They may get there, but they are not there yet. The ambivalence evident in their December response to the question of coverage may be reflective of this dearth of experience.

Federal Contractors will likely be able to handle the few cases that come up as this fairly new area of enforcement takes root at OFCCP. Hopefully, my predictions of where OFCCP might go with this will provide a helpful perspective and a reality check. Knowing that compliance officers are still in the early stages of handling these issues, Federal Contractors should approach the defense of these types of cases by laying out their rationale as clearly as possible, helping compliance officers to draw the appropriate parallels to enforcement areas with which they have more familiarity. Build the bridge from the facts to the conclusion you think is appropriate, don't just hand the compliance officer the building materials and expect him or her to build it for you. This should be done in a way that respects the compliance officer, since how they feel about you affects how they investigate you.

Finally, since OFCCP and EEOC will both be addressing these types of complaints, Federal Contractors should make sure that they make the agencies aware of any overlap in investigation.