The United States Court of Appeals for the Fourth Circuit reaffirmed the broad sweep of Department of Labor (“DOL”) regulations combining affirmtive action. Contractors with 50 or more employees that have contracts of $50,000 or more with the Federal Government must have an affirmation action plan for each of their establishments, including specifically those establishments that have nothing to do with government contracts.
On April 12, 1999, the Fourth Circuit affirmed a lower court decision holding that “affirmative action reporting requirements generally applicable to a government contractor cover all of the contractor’s facilities,” unless the requirement is waived by the Secretary of Labor. See Trinity Industries, Inc. v. Herman, 1999 WL 202850 at 1 (4th Cir. (N.C.)) (1999).
Trinity Industries held contracts with the government that totaled $50,000 or more. Id. After being notified by the Department of Labor’s (“DOL”) Office of Federal Contract Compliance Programs (“OFCCP”) that its Ashville facility had been selected for an affirmative action compliance review, Trinity refused to provide the information requeted on the grounds that such a review was unwarranted because the “facility is not connected with any government contracts and is in all respects separate and distinct from any activities related to the performance of such contracts.”
OFCCP filed an administrative complaint against Trinity seeking to compel compliance with DOL’s affirmative action reporting requirements. After the Administrative Review Board (“Board”) affirmed the administrative law judge’s ruling in favor of OFCCP, Trinity filed suit in the district court contesting the Board’s order. The district court affirmed the Board’s decision that the reporting requirements applied to the Ashville facility.
In upholding the district court’s decision, the Fourth Circuit affirmed that the Executive Order combining affirmative action means what it says:
“[I]n the absence of [ ] an exemption, all facilities shall be covered by the provisions of this Order.” A contractor simply has no authority to determine on its own . . . that one of its facilities is “autonomous” and so not subject to the [affirmative action] reporting requirements.
The Court went on to hold that absent a waiver, DOL’s reporting requirements apply to all contractor’s facilities, even those facilities that are “autonomous and entirely divorced from any activities relating to [the contractor’s] contracts with the federal government.”
In view of the Court’s decision, Government contractors with 50 or more employees that have contracts valued at $50,000 or more should ensure that each of their establishment has an affirmative action plan tailored to each particular location.