STATEMENT OF HON. JOHN T. DUNLOP, SECRETARY OF LABOR, ACCOMPANIED BY BERNARD E. DeLURY, ASSISTANT SECRETARY OF LABOR FOR EMPLOYMENT STANDARDS; FRED CLARK, ASSISTANT SECRETARY OF LABOR FOR ADMINISTRATION AND MANAGEMENT; WILLIAM KILBERG, SOLICITOR OF LABOR; PHILIP DAVIS, DIRECTOR, OFFICE OF FEDERAL CONTRACT COMPLIANCE; AND GEORGE F. TRAVERS, ASSOCIATE DIRECTOR, OFFICE OF FEDERAL CONTRACT COMPLIANCE

Secretary DUNLOP. Thank you very kindly, Mr. Chairman. I am pleased to appear this morning to discuss the Department of Labor's contract compliance program and a number of related issues.

With me are the Solicitor of Labor, on my immediate right, William J. Kilberg; Assistant Secretary for Employment Standards, Bernard DeLury, on my immediate left; the Director of the Office of Federal Contract Compliance, Philip Davis, to Mr. DeLury's left; and Fred Clark, the Assistant Secretary for Administration and Management, who is at the end of the table on my right.

Very few governmental programs are as vital to the future strength of our Nation as the effort to assure equal opportunities for profitable employment to all our citizens. This has been and continues to be one of the Department of Labor's central missions. Job discrimination in its many forms is a tragic and unnecessary waste of our human resources and it is an unfair denial to individuals of the right to achieve their full potential. It is a wrong which this administration seeks to eliminate.

1. DEVELOPMENT OF EEO POLICY

A discussion of issues in the equal employment area needs to recognize the historical context in which these issues have emerged. Perhaps more than any other area of major governmental interest, the development of equal employment requirements reflects the varied formulation of policies by the President, by the Congress, and by the courts. Many of the issues we are now confronting have their source in the diverse origins of equal employment requirements. An understanding of these origins is necessary to appreciate the complexities of the issues we face. I cite Sovern, Michael I., "Legal Restraints on Racial Discrimination in Employment," New York: Twentieth Century Fund (1966) for a fuller analysis of historical background.

The executive branch initially assumed a leadership role in the establishment of equal employment opportunity as a Federal policy through the issuance of a series of Presidential Executive orders, beginning 34 years ago, which have formed the basis of the contract compliance program. Although these Executive orders are addressed only to Government contractors, many of today's commonly known equal employment concepts have their historical antecedents in the Executive order programs. For example, it was a committee chaired by former Vice President Nixon that first suggested in 1960 that Government contractors be required to take affirmative action in the hiring and upgrading of minorities.

In 1961 Executive Order 10925 was issued by President Kennedy incorporating the suggestions of the Nixon committee and providing

for specific sanctions for noncompliance. In 1965 the present administrative arrangement was created by Executive Order 11246 issued by President Johnson. That order delegated authority to the Secretary of Labor rather than a Presidential committee to administer the Federal contract compliance program.

I might pause to note that I was a member of the Equal Opportunities Commission in 1964 and 1965, before that change was made. In 1967 the Executive order program was expanded to include sex as a prohibited basis of discrimination by Executive Order 11375.

Congressional concern with the need for civil rights legislation was clearly expressed with the passage of the Civil Rights Act of 1957. We now have a multiplicity of statutes which deal with different forms of discrimination in employment. These include the Equal Pay Act, passed in 1963; title VII of the Civil Rights Act of 1964; the Age Discrimination in Employment Act of 1967; title IX of the Education Amendments of 1972; the Vocational Rehabilitation Act of 1973; and, most recently, the Vietnam Era Veterans Readjustment Assistance Act, passed in 1974. In addition to these equal employment laws, a variety of nondiscrimination provisions have been included in other statutes, such as title VI of the 1964 Civil Rights Act and section 122 of the General Revenue Sharing Act. Similar provisions have been included in special revenue sharing statutes and other acts such as the Federal Highway Act and various housing statutes.

The courts, too, have contributed to the development of EEO law. Through judicial interpretation of the Constitution and of existing statutes, rights not previously thought to exist have been assured. For example, the courts have found the Civil Rights Act of 1866 applicable to discrimination in private employment and have expanded the doctrine of fair representation under the National Labor Relations Act.

Moreover, the fifth and 14th amendments to the Constitution have been read to require an affirmative obligation on Government to insure that its moneys and its processes are not used in a discriminatory manner. In addition, the courts have expanded the scope of existing equal employment statutes. It is now clear, for example, that title VII includes a broad affirmative action remedy.

2. ROLE OF DEPARTMENT OF LABOR

The Department has had a major role in the implementation of many EEO programs. In addition to our role under the Executive order, the Department also administers and enforces the Equal Pay Act, the Age Discrimination in Employment Act, and the affirmative action requirements for handicapped persons and disabled and Vietnam era veterans under the Vocational Rehabilitation Act and the Vietnam Era Veterans Readjustment Assistance Act.

In the 11 years since the enactment of the Equal Pay Act the Department has collected over $100 million in unpaid back wages for violations of the act. The recipients of this money have included blue collar workers as well as management and professional employees. Relief has been provided for women custodial workers in secondary and elementary schools, as well as for nurses' aides, bank tellers, salesclerks, cashiers, and factory workers. As a result of our efforts, women

employees have received future salary increases amounting to as much as $80 a week.

The Department has filed over 800 lawsuits and is currently instituting about 175 such cases a year. Of the 28 cases heard on appeal, the Department won all but four-including the one case in the Supreme Court.

The Age Discrimination in Employment Act has been in effect for almost 7 years. In that time the Department has instituted over 255 court actions. It currently is filing between 40 and 50 such suits a year. The largest concluded court action was the consent decree obtained from a division of Standard Oil of California which resulted in the reinstatement of 120 former employees and the payment of $2 million, with individual recoveries ranging from $10,000 to $57,000. Potentially much larger suits are currently pending against a number of major employers. In addition to our litigation efforts, the Department engages in extensive conciliation procedures. As a result of these procedures, the Department, in the last 2 calendar years, has obtained jobs, reinstatements or promotions for over 11,000 older workers. It also recovered over $3 million in voluntary payments.

Similarly we have made major strides in the contract compliance program. The term "affirmative action" has been given definition and a body of regulations developed to implement that definition. Important case law has been made, starting with the early litigation in the paper industry which helped to clarify the concept of an "affected class," up to the recent very dramatic multiagency settlements with A. T. & T. and the steel industry. Guidance has been given to help employers, employees, and their collective-bargaining representatives better understand the law of equal employment opportunity. The Department has also prepared aids for the Federal compliance agencies to help them better perform their responsibilities.

3. UNDERLYING EEO ISSUES

After 10 years of experience with the Executive order program it is timely to review the state of the program. And I welcome your oversight hearings, Mr. Chairman, for that purpose because it does seem to me that a 10-year perspective is a very helpful one.

For the last several months I have given these issues some preliminary thought and, while I come to you at the present time with more questions than answers, I would like to share some of my tentative reactions and get your suggestions and views.

First there is a multiplicity of legal authority in the equal employment area. These authorities have created a wide variety of protected classes, including racial, religious, and ethnic minorities, as well as women, handicapped persons, and veterans. So, too, these authorities have resulted in a plethora of enforcement agencies at the State and local level as well as the Federal level, with a concomitant expansion of administrative rules and regulations as well as a growth in the number and variety of forums to which aggrieved individuals might turn for relief.

The net result of these developments may prove to be confusing to those required to live under the equal employment effort. One might question, for example, whether there is not a redundancy of authority,

administration, and forums creating confusion among both those seeking to comply with the intent and purpose of the law and those attempting to secure enforcement of the law. One might also reflect on the growing numbers and categories of persons who benefit from the affirmative action obligation-an obligation over and above enforceable nondiscrimination. Will the administrative and enforcement problems which flow from such an expansion of the affirmative action concept be so great as to impact adversely on affirmative action? A second matter deserving of some thought is the efficacy of using the Government procurement process as an equal employment enforcement mechanism. Is it a wise or appropriate division of equal employment resources to require different or more exacting legal obligations from some employers than we do from others covered by Federal statute? This question is of particular importance in view of the problems inherent in the enforcement of EEO obligations through the procurement system. The meshing of equal employment obligations and procurement law requirements has been a difficult one, resulting in a number of discussions and disagreements over the years with the GAO. We have generally been successful in overcoming GAO objections and criticisms, but the necessity of tailoring equal employment policies to procurement law requirements continues to challenge our

resources.

In addition the reach of the procuremet process is not universal. The Government can enforce its contractual obligations only with those with whom it does business. Yet there are others who have an interest in and are affected by that program, including unions and employment agencies who are out of its reach. Moreover, the Federal procurement process necessarily involves many agencies of Government, creating problems of uniformity in application of the obligations we are seeking to impose.

A third area worthy of examination and one vital both to equal employment objectives and to the procurement process is the reliability of our data and data collection systems. In the Executive order contract compliance program, goals and timetables are used as a means of measuring the progress made by the contractor and also as a way of informing him of his specific contract obligations. But we must ask ourselves, how does one balance the rights of a contractor to be reasonably certain as to the contract commitments he is making and the inherent uncertainty involved in establishing goals and timetables?

We must also examine the reliability of data showing the availability of minorities, women and other protected classes with requisite skills in those geographic areas from which the contractor would reasonably be expected to recruit. This is particularly acute in occupations requiring specialized skills. Serious data problems also arise when we attempt to measure the progress made as a result of the contract compliance program. This is an area of great interest and

concern.

We must also look at the various reporting obligations placed upon contractors. Are they designed to produce usuable data? Employment patterns differ from industry to industry, area to area, and occupation to occupation, and the data collected must be relevant to the

particular industry and accurately reflect changes in the composition of the workforce.

A fourth matter of concern and one related to the problem concerning the reliability of data is the question of when, if ever, the affirmative action obligation ought to cease for individual contractors or economic sectors. Ought we to view this obligation as a permanent one in each case, or do we envision a point in time when a contractor has shown a successful record of minority hiring or employment and can be expected to continue such practice with a minimum of Government oversight?

I believe that the future effectiveness of the equal employment opportunity effort requires us to give these questions and others careful consideration; though I hasten to add, I have no answers at this time.

4. INTERAGENCY COORDINATION

We recognize, however, that progress cannot wait the resolution of these fundamental questions. We must therefore address ourselves to immediate areas of concern.

It is clear that the effectiveness of our efforts in equal employment opportunity depends upon a close and cooperative relationship between the various Federal agencies with equal employment opportunity responsibilities. In this respect it is necessary that steps be taken to assure uniformity of interpretation among Federal agencies and that existing mechanisms be reviewed for their efficacy.

The proper forum for the resolution of differences between agencies is the Equal Employment Opportunity Coordinating Council, which was created by Congress in 1972. The Council, which consists of representatives of the Departments of Justice and Labor, the EEOC, the Civil Service Commission, and the Commission on Civil Rights, is charged with the responsibility of reaching uniform or consistent policies on issues involving the administration or enforcement of the various EEO laws. An example of the proper use of the Council is its attempt to develop a uniform policy among the agencies on the seniority and layoff questions. A committee composed of staff from each of the agencies is presently attempting to work out a common policy for consideration by the Council. The Council has also been attempting for some time to develop a government-wide policy on testing and selection guidelines. I support the EEOCC's review of these areas and I endorse the attempt to arrive at common policies. It is imperative that the Government speak with one voice when it promulgates policies affecting employment practice throughout the Nation.

Related to the problem of agency EEO coordination is the need for the agencies to give full faith and credit to settlements entered into by each other. Clearly if an equal employment opportunity issue is resolved by one agency, other agencies with EEO responsibilities should honor the agreement. Without this mutual comity it will be exceedingly difficult to conciliate and negotiate agreements.

5. ORGANIZATION OF DEPARTMENT OF LABOR EFFORT

Within the Department of Labor we have been sensitive to the need to assure consistency of policy developments with regard to equal employment programs which we administer. So, for example, we have reorganized and expanded the Office of Federal Contract Compliance