Insights

The first day of the Trump Administration included the issuance of 26 executive orders(“EOs”), the most in modern presidential history. Among these EOs, President Trump signed the Defending Women from Gender Ideology Extremism and Restoring Biological Truth to the Federal Government Executive Order (the “EO” or “Order”). While focused on federal policy, the Order has broad implications for private sector employers.

Late on the night of January 21, 2025, President Trump signed the “Ending Illegal Discrimination And Restoring Merit-Based Opportunity” Executive Order (the “EO”). This EO, like a number of the executive orders issued on his first day in office, took aim at Diversity, Equity, and Inclusion (“DEI”) programs by, among other things, broadly directing executive agencies and departments to terminate all “discriminatory and illegal preferences, mandates, policies, programs, activities, guidance, regulations, enforcement actions, consent orders, and requirements;” curtailing the Office of Federal Contract Compliance Programs’ (OFCCP) operational authority and directing agencies to scrutinize the DEI practices of private sector employers. Additionally, this language raises questions about the future and status of certain programs, preferences, and set-aside procurements administered by the U.S. Small Business Administration, U.S. Department of Transportation, and other agencies. 

On October 29, 2024, the Office of Federal Contract Compliance Programs (“OFCCP”) published a notice in the Federal Register that it received two requests under the Freedom of Information Act (“FOIA”) for 2021 Type 2 EEO-1 Reports filed by federal contractors.  The two requests came from the University of Utah and a non-profit organization named “As You Sow.”  The OFCCP notified federal contractors that the information might be protected from disclosure under FOIA Exemption 4, which protects disclosure of confidential commercial information, and requested that any entities that filed these reports and object to their disclosure submit objections by December 9, 2024.  Objectors are strongly encouraged to use the OFCCP portal.  Alternatively, contractors may also submit written objections via email at OFCCPSubmitterResponse@dol.gov, or by mail. 

On May 17, 2024, Colorado Governor Jared Polis signed S.B. 24-205, Consumer Protections for Artificial Intelligence, the first state law in the country to regulate employers’ use of artificial intelligence in employment decisions.  This law regulates both companies that develop and companies that deploy “high-risk” artificial intelligence systems (“AI systems”).  In particular, the law sets forth a set of provisions designed to ensure that developers and deployers use “reasonable care” to protect consumers from any “known or reasonably foreseeable risks to algorithmic discrimination” arising from the use of the AI system.  The law then creates a rebuttable presumption, for both deployers and developers, that reasonable care was used if they meet specific requirements and disclose key information about high-risk AI systems.  This law will be enforced by the Colorado Attorney General, and a violation of the law constitutes an unfair trade practice.  The law becomes effective on February 1, 2026.

Now more than ever, federal contractors find themselves at the intersection of innovation and regulation, particularly in the realm of Artificial Intelligence (AI).  AI is now incorporated into a broad range of business systems, including those with the potential to inform contractor employment decisions.  For that reason, the Office of Federal Contract Compliance Programs (OFCCP) has issued new guidance entitled “Artificial Intelligence and Equal Employment Opportunity for Federal Contractors” (the “AI Guide”).  OFCCP issued the AI Guide in accordance with President Biden’s Executive Order 14110 (regarding the “Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence”), which we reported on here.  The AI Guide provides answers to commonly asked questions about the use of AI in the Equal Employment Opportunity (EEO) context.  The AI Guide also offers “Promising Practices,” which highlight a number of important considerations for federal contractors.  Focusing on federal contractors’ obligations and attendant risks when utilizing AI to assist in employment-related decisions, the AI Guide also provides recommendations for ensuring compliance with EEO requirements while harnessing the efficiencies of AI.

On April 15, 2024, the U.S. Equal Employment Opportunity Commission (“EEOC”) announced in a press release its implementation of a Final Rule on the Pregnant Workers Fairness Act (“PWFA”), published that day in the Federal Register.  The Final Rule fundamentally extended the PWFAs protections, broadly defining what had been ambiguous phrases to expand the scope of individuals qualifying for accommodations, when employees and applicants for employment may seek an accommodation, and how employers should engage with them upon receiving a request for accommodation.

On January 30, 2024, the FAR Council issued a proposed rule entitled “Pay Equity and Transparency in Federal Contracting” (“Proposed Rule”). The Proposed Rule would: (1) prohibit contractors and subcontractors from seeking and considering information about job applicants’ compensation history when making employment decisions about personnel working on or in connection with a government contract; and (2) require contractors and subcontractors to disclose, in all advertisements for job openings involving work on or in connection with a government contract placed by or on behalf of the contractor or subcontractor, the compensation to be offered to the hired applicant for any position to perform work on or in connection with the contract.

On June 29, 2023, the Supreme Court held that it is unconstitutional (under the Constitution’s Equal Protection Clause, as to public institutions) and a violation of Title VI of the Civil Rights Act of 1964 (as applicable to private institutions accepting federal financial assistance) for colleges and universities to consider race as a factor in the admissions process. See Students for Fair Admissions, Inc. v. President & Fellows of Harvard Coll., No. 20-1199, 2023 WL 4239254 (U.S. June 29, 2023) (“Harvard”), a summary of which can be found here. This decision upended decades of precedent and has caused employers in the private sector to ask how the decision will impact diversity, equity, and inclusion (“DE&I”) initiatives and employment decisions. This article addresses the impact of Harvard, eight months later.

Following a January 29, 2024 White House announcement and Fact Sheet, on January 30, 2024, the Federal Acquisition Regulation (FAR) Council issued a Notice of Proposed Rulemaking (Proposed Rule) on salary-history bans and pay transparency for applicants and employees of federal contractors and subcontractors. On the same day, the Office of Federal Contract Compliance Programs (OFCCP) issued some FAQs on the compensation history issue. These actions by the federal government to ban prior salary information and require compensation information in job postings echo the efforts of multiple states and municipal governments that have enacted similar salary history bans and/or compensation disclosure requirements:

On September 13, 2023, the New York State Department of Labor released proposed regulations aimed at clarifying employer obligations under New York State’s pay transparency law (“Law”).  The Law, effective September 17, 2023, requires employers in New York State to disclose compensation or compensation ranges and existing job descriptions for all advertised jobs, promotions, and transfer opportunities. Crowell & Moring LLP previously reported on the Law, issued on December 21, 2022, and on its subsequent amendments, signed into law on March 3, 2023.

Illinois is poised to become the latest state to require employers to provide salary information in job postings.  Governor J.B. Pritzker is expected to sign House Bill 3129, which amends the Illinois Equal Pay Act (IEPA) and requires employers to include pay scale and benefits information in job postings.  If the Bill is enacted, its requirements will go into effect on January 1, 2025, and will apply to employers with 15 or more employees and to positions that are (i) physically performed, in whole or in part, in Illinois or (ii) physically performed outside of Illinois where the employee reports to a supervisor, office or other work site in Illinois. 

Local Law 144, New York City’s law governing the use of automated employment decision tools (“AEDTs”), became effective on July 5th, approximately six months after its original effective date and following several rounds of hearings on its proposed and Final Rule.  Just days prior, the New York City Department of Consumer and Worker Protection (“DCWP”) released a set of Frequently Asked Questions (“FAQs”) to provide guidance for covered employers regarding some of the many open questions that have been raised throughout the months since its regulations were first issued.  While the FAQs provide some clarity, many questions remain.

On June 21, 2023, the New York State Department of Labor (“NYSDOL”) issued updated regulations to the New York State Worker Adjustment and Retraining Notification Act (“NYS WARN Act”), which requires employers with 50 or more employees to provide 90 days’ notice of mass layoffs, plant closings and other specified employment losses.  According to the NSYDOL website, these new regulations are intended to “address the post-pandemic employment climate” and “simplif[y] language to ensure businesses better understand their obligations.”  The changes include, among other things:

On May 22, 2023, the Department of Consumer and Worker Protection (“DCWP”) held a roundtable on Local Law 144, New York City’s law regulating the use of Automated Employment Decision Tools (“AEDT”), which will go into effect on July 5.  The roundtable followed the “Final Rule” for the New York AEDT law and clarified several open questions that the Final Rule had left unanswered, including the applicability of the law, the scope of data requirements for the bias audit, and the notice requirement.

On April 10, 2023, after considering public comments, the Office of Federal Contract Compliance Programs (“OFCCP” or the “Agency”) issued a modified version (“Modified Revision”) of its initial proposed revisions to the Scheduling Letter and Itemized Listing published on November 21, 2022 (“Initial Revision”).  OFCCP retracted a few of its proposed information and data demands (e.g., no requirements to identify whether a promotion is “competitive” or “non-competitive”).  However, its more onerous and fundamental changes remain – most notably, requiring submission of information regarding the use of artificial intelligence tools, more compensation data, and documentation of compensation analyses.  The Modified Revision does little to alleviate contractors’ concerns that the revised Scheduling Letter and Itemized Listing will significantly increase the burden of responding to an OFCCP audit and related risk.

Today, the New York City Department of Consumer and Worker Protection (“DCWP”) announced the “Final Rule” for the New York AEDT law (Local Law 144), and stated that the enforcement date is moved back from April 15, 2023, to July 5, 2023.

On March 3, 2023, New York Governor Kathy Hochul signed into law A999 / S1326 (the “Amended Law”), which includes amendments to New York State’s pay transparency law (“Law”) that both broaden and lessen obligations on employers. Specifically, the Amended Law modifies the scope of covered jobs, eliminates the recordkeeping requirement, and clarifies the definition of “advertise.” What remains unchanged, however, is the September 17, 2023, effective date and the requirement to include the job description in an advertisement, if one exists. Crowell & Moring LLP (“Crowell”) previously reported on the originally-enacted Law, which can be found here.

On January 10, 2023 New Jersey Governor Phil Murphy signed into law a new version of New Jersey’s “mini-WARN Act,” or the Worker Adjustment and Retraining Notification Act (“NJ WARN Act”). The amendment makes the NJ WARN Act in some ways the most expansive WARN Act in the country: it increases the scope of covered employers, counts employee layoffs statewide (rather than by worksite) to meet the notice threshold, requires 90 days’ notice (rather than 60), and mandates severance payments even when proper notice is given. These changes will take effect on April 10, 2023.

As reported in a prior client alert, California Governor Gavin Newsom signed Senate Bill 1162 last September, requiring private employers with more than 100 employees to submit significantly more pay data to the California Civil Rights Department (CRD) beginning in May 2023. The statute left a number of critical questions unanswered and CRD has now updated its Frequently Asked Questions (FAQs), providing some additional guidance for the 2022 reporting year, including on labor contractor worker reporting.

On December 21, 2022, Governor Hochul signed Bill A10477/S9427A, New York’s first statewide pay transparency statute, into law. When the statute goes into effect on September 18, 2023, New York State will join a growing number of jurisdictions that have adopted pay transparency laws. The New York State pay transparency law (“Law”) requires employers to list compensation or compensation ranges and job descriptions for all advertised jobs, promotions, and transfer opportunities that can or will be performed in New York State, including positions that are fully remote. According to Governor Hochul, the Law seeks to “usher in a new era of transparency for New York’s workforce” and tackle “pervasive pay gaps for women and people of color.” The Law will not preempt or supersede its New York City counterpart or any other local pay transparency statutes.