Federal contractors or subcontractors (“government contractors”) that consider themselves religious organizations may wish to reevaluate their status as religious organizations and other implications of the new U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) Final Rule “Implementing Legal Requirements Regarding the Equal Opportunity Clause’s Religious Exemption” (“Final Rule”) that took effect January 8, 2020 while keeping a close eye out for further modifications or refinement to the rules by the incoming Biden Administration and the courts.
Executive Order 11246, Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as amended, generally prohibit federal contractors to discriminate in employment because of race, color, religion, sex, sexual orientation, gender identity, national origin, disability, or status as a protected veteran. In addition, contractors and subcontractors are prohibited from discriminating against applicants or employees because they have inquired about, discussed, or disclosed their compensation or the compensation of others subject to certain limitations, and may not retaliate against applicants or employees for engaging in protected activities. These laws also require that federal contractors provide equal employment opportunity through affirmative action and report data about their employment practices.
While generally prohibiting religious discrimination in employment, Executive Order 11246, also acknowledges Constitutional religious freedom protections by providing religious organizations may prefer in employment “individuals of a particular religion,” to maintain their religious identity and integrity. The Final Rule announced by the Trump Administration on December 7, 2020 does not change the vast majority of federal contractors’ responsibilities to comply with their equal employment opportunity and affirmative action obligations under Executive Order 11246. However, it does seek to clarify and maximize the legal protection of religious exercise permitted by the Constitution and law taking into account the Religious Freedom Restoration Act by adding a rule of construction, definitions of key terms and several examples within the definition of “religious corporation, association, educational institution, or society” to better illustrate which organizations may qualify for the religious exemption.
Federal contractors that believe they qualify for coverage by the new Final Rule should document their qualification, keeping in mind that its applicability turns on a highly fact specific, evidence based test. Those relying on the rules should work with experienced legal counsel to evaluate and preserve evidence demonstrating the basis of qualification and other risk management strategies, while simultaneously watching for potential refinements to the rules by the incoming Biden Administration, the courts or both.
For more information about the Final Rule or other federal employment discrimination and affirmative action rules, e-mail the author of this update, Texas Board of Legal Specialization Board Certified Labor and Employment Lawyer, Cynthia Marcotte Stamer.
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About the Author
Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for 30+ years working as an on demand, special project, consulting, general counsel or other basis with domestic and international business, charitable, community and government organizations of all types, sizes and industries and their leaders on labor and employment and other workforce compliance, performance management, internal controls and governance, compensation and benefits, regulatory compliance, investigations and audits, change management and restructuring, disaster preparedness and response and other operational, risk management and tactical concerns.
Most widely recognized for her work with health care, life sciences, insurance and data and technology organizations, she also has worked extensively with health plan and insurance, employee benefits, financial, transportation, manufacturing, energy, real estate, accounting and other services, public and private academic and other education, hospitality, charitable, civic and other business, government and community organizations. and their leaders.
Ms. Stamer has extensive experience advising, representing, defending and training domestic and international public and private business, charitable, community and governmental organizations and their leaders, employee benefit plans, their fiduciaries and service providers, insurers, and others has published and spoken extensively on these concerns. As part of these involvements, she has worked, published and spoken extensively on these and federal and state discrimination, affirmative action and accommodation and other related human resources, employee benefits and other workforce and services; insurance; workers’ compensation and occupational disease; business reengineering, disaster and distress; and many other risk management and compliance concerns.
A former lead advisor to the Government of Bolivia on its pension project, Ms. Stamer also has worked internationally and domestically as an advisor to business, community and government leaders on these and other legislative, regulatory and other legislative and regulatory design, drafting, interpretation and enforcement, as well as regularly advises and represents organizations on the design, administration and defense of workforce, employee benefit and compensation, safety, discipline, reengineering, regulatory and operational compliance and other management practices and actions.
Ms. Stamer also serves in leadership of a broad range of professional and civic organizations and provides insights and thought leadership through her extensive publications, public speaking and volunteer service with a diverse range of organizations including as Chair of the American Bar Association (“ABA”) Intellectual Property Section Law Practice Management Committee, Vice Chair of the International Section Life Sciences and Health Committee, Past ABA RPTE Employee Benefits & Other Compensation Group Chair and Council Representative and current Welfare Benefit Committee Co-Chair, Past Chair of the ABA Managed Care & Insurance Interest Group, past Region IV Chair and national Society of Human Resources Management Consultant Forum Board Member, past Texas Association of Business BACPAC Chair, Regional Chair and Dallas Chapter Chair, former Vice President and Executive Director of the North Texas Health Care Compliance Professionals Association, past Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, past North Texas United Way Long Range Planning Committee Member, past Board Member and Compliance Chair of the National Kidney Foundation of North Texas, a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation and many others.
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