United States: OFCCP's New Sex Discrimination Regulations Bring Few New Requirements But Highlight Need For Contractors To Revisit Policies And Practices

On June 14, 2016, the U.S. Department of Labor's Office of Federal Contract Compliance Programs ("OFCCP") unveiled its final sex discrimination guidelines governing covered federal contractors. The OFCCP proposed changes to the rule on January 30, 2015 and the official comment period closed on April 14, 2015, following a two-week extension so that it could take comment on the Supreme Court's pregnancy discrimination decision in Young v. United Parcel Serv., Inc. The final rules come six months after the expected date on the fall regulatory agency but were released to coincide with the White House Council on Women and Girls first "United State of Women" summit, which was also held on Tuesday. Our coverage of that event can be found here

The final rules mark a significant rewriting of the guidelines, which were originally published in 1970, and address various intervening developments respecting sexual harassment, pregnancy leave, gender identity and sex stereotyping. The OFCCP attempts to minimize the impact of the final rules by stating that the rules merely enshrine policies already established by the courts and other federal agencies. However, by codifying those principles through notice and comment rulemaking and announcing them with fanfare at the White House, the Obama administration sends a clear signal that the rule change is a pillar of its domestic equality agenda.

Highlights from the New OFCCP Guidelines

The final rules mirror the proposal in many respects and the OFCCP resisted some of the EEOC's far reaching positions. We highlight various aspects of the final rule below.

LGBT Status: Executive Order 13672 outlawed discrimination on the bases of gender identity and sexual orientation by federal contractions. The final regulations, however, do not link this prohibition to per se sex discrimination. Rather, the OFCCP limits sex discrimination to "[a]dverse treatment of an employee or applicant for employment because of that individual's failure to comply with gender norms and expectations for dress, appearance, and/or behavior," which includes "actual or perceived gender identity or transgender status." Gender identity is also covered under the new guidelines, which forbid contractors from denying employees "access to the restrooms, changing rooms, showers, or similar facilities designated for use by the gender with which they identify." Furthermore, contractors must not treat employees "adversely because they have received, are receiving, or are planning to receive transition-related medical services designed to facilitate the adoption of a sex or gender other than the individual's designated sex at birth."

Notably, the OFCCP could have added "sexual orientation" as a protected class under the sex-based discrimination theory embraced by the U.S. Equal Employment Opportunity Commission ("EEOC") in Baldwin v. Dep't. of Transp. The OFCCP ultimately declined to do so, concluding that relevant "Title VII law is still developing." This is significant, and signals a lack of consensus on adopting "sexual orientation" as a uniformly recognized protected class under federal law. Another notable change from the proposal was the OFCCP's decision to remove "adverse treatment based on being in a same-sex relationship" as an example of potential sex discrimination. While the OFFCP states that this change results from those types of discriminatory behavior having been subsumed under the new section on sex-based stereotyping, it is another notable departure from the EEOC's explicitly contrary position.

Compensation Discrimination: The final rule forbids any "employment practice that discriminates in wages, benefits, or other forms of compensation." While this prohibition is somewhat generic, the textual changes from the proposal and agency's discussion of compensation discrimination is enlightening based on the OFCCP's recent aggressive stances on pay disparity. First, the final rule changes the prohibition on denying "equal wages" to "discriminating in wages," clarifying confusion implicating the Equal Pay Act. Notwithstanding this textual change, the accompanying section-by-section analysis contains language akin to the OFCCP's compensation review standards outlined in Directive 307. Conspicuously absent, however, is any mention of the "pay analysis groups" which are so prominent in Directive 307.

Pregnancy Discrimination: As the proposed rule indicated, the finalized regulations attempt to harmonize OFCCP regulations with the provisions of the Pregnancy Discrimination Act of 1978 and recent U.S. Supreme Court jurisprudence. The guidelines provide various examples of pregnancy discrimination, including refusing to hire or firing an individual or limiting job duties based solely on pregnancy, and failing to provide health insurance for childbirth to the same extent coverage is provided for other medical expenses. Overall, the OFCCP adopts the test from Young requiring contractors to provide pregnancy leave "on the same terms that medical or sick leave is provided for medical conditions that are similar in their effect on employees' ability to work."

Transgender Related Benefits: The section-by-section analysis addresses the extent to which contractors must provide health insurance coverage for "transition-related services." First, the analysis states that "the nondiscrimination requirements of [Executive Order 11246] obligate contractors to ensure that coverage for health-care services be made available "on the same terms for all individuals for whom the services are medically appropriate, regardless of sex assigned at birth, gender identity, or record gender." Additionally, contractors may not adopt insurance coverage that includes "categorical exclusions" regarding "all health services associated with gender dysphoria or gender transition." The regulations, however, do not require that contractors provide coverage for all transition-related services. Rather, "[i]f a contractor generally provides coverage for a particular treatment or service, e.g., hormone replacement or mental health care, where it is medically necessary, the contractor cannot decline to provide coverage for that same treatment when it is deemed medically necessary for a transgender individual because the treatment is related to his or her gender identity or transgender status."

Contraception Coverage: The OFCCP declined to include proposed language that would have required contractors' health insurance cover contraception to the same extent that medical costs are covered for other medical conditions. Therefore, the regulations do not explicitly require that contractors provide contraception coverage. The retraction appears to be the result of the Supreme Court's failure to resolve the issue in Zubik v. Burwell. OFCCP's position in this regard is also at odds with the EEOC's position that failing to provide contraception coverage constitutes a violation of Title VII if the employer provides coverage for prescriptions and devices related to other, separate medical conditions.

Family Leave: The final regulations also stress that sex-based discrimination affects men as well as women, emphasizing that family leave must be made available to mothers and fathers. To this end, adverse treatment of a male employee who is unavailable on weekends due to caring for an infirm, elderly parent is cited as an example of potential sexual stereotyping. So too is adverse treatment of a male employee who takes leave "to care for his newborn or recently adopted or foster child based on the sex-stereotyped belief that women and not men should care for children."

Takeaways for Federal Contractors

The final rules do not set forth onerous new requirements for contractors. However, some of the nuances of the rule require close attention. Contractors would be wise to consider the following:

  1. Reviewing their LGBT policies to ensure that they provide for the wide range of protections. Crafting policies related to gender identity, bathroom usage, and leave for transition-related services can be complex given the web of state and federal requirements. Further, as the interpretative disagreement between the OFCCP and the EEOC indicates, the agencies have different interpretations related to key issues (such as whether discrimination based on being a part of a same-sex couple is specifically recognized).
  2. Revisiting insurance coverages. The new rules require that contractors look more closely at their insurance coverages related to pregnancy, contraception coverage and transition related services. Again, the differing interpretations by the EEOC, OFCCP and courts make it difficult to determine what the exact legal requirements for contractors are as they relate to required coverages. Rising health care costs may lead contractors to look for ways to shortcut coverage but these requirements play a role in evaluating risks related to that goal.
  3. Evaluating pregnancy and other leave policies. The requirements regarding accommodations and leave are somewhat in flux as agency practice and case law develops around exactly what is required. Going forward, contractors should evaluate their policies to see if they impose a disparate impact, or constitute disparate treatment of, pregnant workers.

The final rule becomes effective on August 14, 2016 so contractors do not have a significant period of time to ensure that their policies are compliant.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
26 Sep 2018, Seminar, Tokyo, Japan

Orrick’s Global Japan Practice is hosting a series of “Orrick Library” seminars to explore legal issues in various fields in Japan as well as the United States, Asia and Europe

26 Sep 2018, Conference, New York, United States

Employment Partner, Mandy Perry and Chair of Orrick's Global Employment Law Practice, Mike Delikat will be participating in the Global Business Protections 2018: International Restrictive Covenants and Confidential Information Conference.

10 Oct 2018, Conference, Florida, United States
Julie Totten is Program Chair of this year’s conference, Lynne Hermle is speaking on women in the courtroom, boardroom, and c-suite, and Erin Connell is speaking on pay equity and pay transparency.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions