New Final Rule Brings E.O. 11246 into the 21st Century

On June 14, 2016, the Office of Federal Contract Compliance Programs (OFCCP) announced a final rule which updates guidelines that covered contractors must meet under the provisions of Executive Order 11246. A well-established rule, E.O. 11246 prohibits sex discrimination in employment by federal contractors; however, the guidelines implementing it date back to 1970. These guidelines are out of touch with current law and with the realities of today’s workplace.

The final rule deals with a variety of sex-based barriers to equal employment and fair pay, including compensation discrimination, sexual harassment, hostile work environments, failure to provide workplace accommodations for pregnant workers, and gender identity and family caregiving discrimination. The final rule provides examples of prohibited sex discrimination in the workplace to ensure that contractors understand their obligations while providing examples of best practices for prevention of discrimination. Specifically, here’s what the final rule does:

  • Updates the sex discrimination guidelines by providing more accurate and relevant guidance.
  • Protects against discriminatory treatment because of pregnancy, childbirth, or related medical conditions, including loss of jobs, wages, or health care coverage. For instance, the rule requires that contractors provide workplace accommodations, such as extra bathroom breaks and light-duty assignments, to an employee who needs such accommodations because of pregnancy, childbirth, or related medical conditions, in certain circumstances where those contractors provide comparable accommodations to other workers, such as those with disabilities or occupational injuries.
  • Emphasizes fair pay practices and reinforces that contractors may not pay workers differently on the basis of sex. For instance, contractors may not deny opportunities for overtime work, training, better pay, or higher-paying positions on the basis of sex.
  • Prohibits discrimination on the basis of sex with regard to fringe benefits such as medical, hospital, accident, life insurance, and retirement benefits; profit-sharing and bonus plans; leave; and other terms, conditions, and privileges of employment.
  • Prohibits unwelcome sexual advances, requests for sexual favors, offensive remarks about a person’s sex, and other verbal or physical conduct of a sexual nature when such conduct unreasonably interferes with an individual’s work performance, becomes the basis for employment decisions, or creates a hostile working environment.
  • Gives men and women equal access to jobs and workforce development opportunities by prohibiting a contractor from setting requirements for jobs or training that are based on the person’s sex unless the contractor can meet the high bar of demonstrating that such requirements are a bona fide occupational qualification. Also, contractors are prohibited from setting requirements, such as height or weight qualifications, that adversely affect applicants because of their sex unless it demonstrates that the qualifications are job-related and consistent with business necessity.
  • Safeguards workers who provide caregiving to their loved ones by prohibiting a contractor from treating a female or male employee or applicant differently based on the stereotypical assumption that women are more likely to have caregiving responsibilities. For instance, contractors may not deny mothers employment opportunities that are available to fathers based on the faulty assumption that a mother’s childcare responsibilities will conflict with her job performance. Similarly, contractors may not deny a father’s flexible workplace arrangement that is available to mothers based on the faulty assumption that men do not have and do not assume childcare responsibilities.
  • Protects transgender workers by clearly delineating that sex discrimination includes discrimination because of an employee’s gender identity. In addition:
    • The rule requires contractors to allow workers to use bathrooms, changing rooms, showers, and similar facilities consistent with the gender with which the workers identify.
    • The preamble to the rule also notes that an explicit, categorical exclusion of coverage for all care related to gender dysphoria or gender transition is facially discriminatory, meaning it singles out services and treatments for individuals on the basis of their gender identity or transgender status.
  • Prohibits discrimination based on sex stereotypes by not allowing contractors to treat employees or applicants adversely because they fail to comply with expectations about “how women and men should look or act” or “what type of jobs they should perform.”

The final rule is also consistent with the Religious Freedom Restoration Act (RFRA) and other protections for religiously affiliated contractors. Although there is no formal process for invoking the RFRA as a basis for an exemption from E.O. 11246, the preamble to the final rule states that if the application of any requirement under this part would violate the RFRA, that application will not be required. The OFCCP also notes that E.O. 11246 specifically allows religiously affiliated contractors (religious corporations, associations, educational institutions, or societies) to favor individuals of a particular religion when making employment decisions. The OFCCP also follows Supreme Court precedent recognizing that the First Amendment to the Constitution requires a “ministerial exception” from employment discrimination laws, which prohibits the government from interfering with the ability of a religious organization to make employment decisions about its “ministers.”

In preparation for the final rule, federal contractors and other applicable entities can exhale a sigh of relief because the regulations align with already existing law and legal interpretations. The OFCCP expects that contractors are already complying with most, if not all, of the final rule’s obligation. However, for those who are concerned, the final rule has a best practices appendix which recommends a number of practices for contractors to consider such as:

  • Avoiding the use of gender-specific job titles such as “foreman” or “lineman” where gender-neutral alternatives are available.
  • Designating single-user restrooms, changing rooms, showers, or similar single-user facilities as sex-neutral.
  • Providing appropriate time off and flexible workplace policies for both men and women.
  • Encouraging men and women equally to engage in caregiving-related activities.
  • Fostering an environment in which all employees feel safe, welcome, and treated fairly, by developing and implementing procedures to ensure that employees are not harassed because of sex. Examples of such procedures include:
    • Communicating to all personnel that harassing conduct will not be tolerated;
    • Providing antiharassment training to all personnel; and
    • Establishing and implementing procedures for handling and resolving complaints about harassment and intimidation based on sex.

According to the OFCCP, adopting these best practices can contribute to the establishment and maintenance of workplaces that are free of unlawful sex discrimination.

About Samantha Yurman, JD

Samantha Yurman is one of ThinkHR's legal editors. She is a licensed attorney in California and Florida with over 16 years of experience researching and analyzing human resources legislation and law. Samantha uses her expertise to translate highly technical legal topics into usable information for our clients.