The Advantage, July 1997

California Overtime Changes

Early in April this year, the California Industrial Welfare Commission (IWC) passed a measure which will do away with the 8-hour day for the purposes of computing overtime. Up to that time California was one of only three states requiring overtime pay after an employee worked 8 hours in any one day. Alaska and Nevada were the other two states.

The IWC vote was 3 to 2. This followed a series of public hearings in various locations throughout the state to discuss the proposed change and to solicit public comment.

As you might imagine, labor has promised a court challenge to the IWC changes. Assuming the IWCís new order is upheld, it will be effective on January 1, 1998. When we talked with the IWC office in April, they had not even finished compiling official minutes from the Commissionís meeting.

This change brings Californiaís overtime rules into line with the federal Fair Labor Standards Act of 1938 (FLSA). FLSA specifies that overtime must be paid when an employee exceeds 40 hours in any one workweek.

Official notice will be sent to all employers with California employer ID numbers by way of the Employment Development Department (EDD).

Until then, we recommend that employers maintain their current approach to overtime computation and payment. The IWC reports many employers wanting to make the change now and warns that is both inappropriate and illegal.

Employment Poster

While we're on the subject of California requirements, let's be sure all California employers are aware that they must have MW-96 posted next to the appropriate Industrial Welfare Commission (IWC) order for their specific industry.

Regardless of the industry, all California employers must post MW-96 everywhere they have their other required employment posters.

MW-96 shows the specific minimum wage requirements for California at each of the four incremental steps between October 1, 1996 and March 1, 1998. As you know from the last issue of The Advantage newsletter, California's minimum wage requirement will be increasing to $5.75 per hour next March.

This two page notice is available free of charge from several locations. You may contact the IWC at their offices (45 Fremont Street, Suite 3130, San Francisco, CA 94105 415-975-0761) or pull the document file directly from the internet. You will find it at the following address: http://www.dir.ca.gov/dir/Labor_law/IWC/iwc.htmll

If you wish, you may also obtain a copy of the notice from our FAX-Back system. Simply phone 510-671-0412 from any touch tone phone and request document #264. You will be asked for your FAX number. After you have followed the verbal system instructions, your MW-96 will be sent to your FAX machine by return call. (We are sorry, but this free service is available only to those within the United States. International FAX calls will be billed to the requesting party for the cost of the FAX transmission plus a US$50.00 service and processing fee per call.)

You might also consider requesting a copy of the system index (document #101) to see all the other free reports and articles we have added recently.

FREE Subscription

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TMA, Inc. Receives Award

The Management Advantage, Inc. was honored recently with an award for its internet site.

BizCardz Business Director Quality Site Award was presented based on these selection criteria: Useful content, exceptional design, and ease of use.

BizCardz Business Directory offers a complete directory of resources to help the business owner and manager. If you havenít visited their directory yet, you might want to take a look. You can find them at: http://www.bizcardz.net

And, while youíre on the internet, stop by our site. Weíve given it a whole new look. You will find it more interesting as you browse. And, you will still be able to locate all the helpful information we have become known for in our quarterly newsletters. We are pleased that this issue of The Advantage is being electronically distributed to over eight countries around the world.

If you havenít yet sent us your e-mail address, please do. We are going to be reducing our regular mail list before our next issue is published. You donít want to miss out. Simply send us a message at tmainc@management-advantage.com and say "Subscribe THE ADVANTAGE" in the subject.

Minority Contracting Goes Up Not Down

From a Wall Street Journal story by Hilary Stout and Eva M. Rodriguez on May 7, 1997 comes the revelation that government contracting to minority vendors has increased over the past two years.

Why is this news? Well, recall that two years ago the U.S. Supreme Court issued its now-famous ruling in Adarand Constructors, Inc. v. Pena (115 S. Ct. 2097, 1995). While this case applied only to government employers, and has no direct impact on private sector employers, there are influences as you can imagine.

Adarand established that any governmental action that uses race or ethnicity as a basis for decision-making will be subject to strict scrutiny.

Since the Adarand case had to do with government contracting, a great deal of speculation was offered at the time about what its impact would be on minority- or women-owned companies trying to get business with the federal government. Some said the government would no longer be able to use "set-asides" for participation of minority- and women-owned businesses. (We shared that interpretation of the case.)

Well, letís see what has actually happened during the past two years.

"Since the ruling, only one government set-aside program has been eliminated. In fact, during Bill Clintonís presidency, the portion of government contracts awarded under racial-preference programs has grown steadily, though it is still a small portion of all federal contracts.

"Last year, minority-owned businesses meeting federal 'disadvantaged' criteria received $10.9 billion in government contracts out of the $198 billion total contracts awarded; that was up from $8.5 billion in 1992."

In early May of this year, the Clinton Administration announced that it was issuing new rules for using set asides for minority-owned businesses. The new rules promise to use affirmative action remedies only when there is clear evidence of discrimination within a particular industry. "This is part of the presidentís agenda to mend affirmative action, not end it," said Rahm Emanuel, a senior advisor to President Clinton. "The regulations will continue our effort to target and break down discriminatory barriers." Administration officials say they expect the number of minority contracts will continue to grow under the new rules.

"The administration's new approach will be based on a Commerce Department study of some 80 industries to determine where minority firms are experiencing discrimination in government contracts. From this, the administration will develop benchmarks that are supposed to measure the level of minority participation in an industry that would exist had discrimination not happened. The administration will then compare that hypothetical benchmark to the percentage of dollars awarded to minority firms through government contracts to determine whether there is a gap."

"To the degree that actual minority contracting is below the [benchmark] level, race-conscious measures will be permitted," the Justice Department says. The proposal calls for the government to scale back or eliminate affirmative action credits if the amount of minority participation exceeds the benchmark for a particular industry.

Under the new plan, minorities are still automatically considered socially and economically disadvantaged. They will receive "credits" in bid competitions. The same rules would make it a bit easier for White women to qualify for the same "credits," but they will still have to prove they are economically disadvantaged, unlike minority women. These credits will amount to as much as 10% of the bid amount, depending on the industry. So, rather than the old system of set-asides, the new plan will use price credits to give added advantage to minority contractors bidding on government contracts.

There is one provision of the new plan which allows for unsuccessful bidders to challenge the award of a government contract. That could occur if the contract was won by a minority firm which received affirmative action credits it it can be shown that the minority firm is not economically disadvantaged.

The Commerce Department study of industries will not be completed until late this summer. Until its results are known, it is difficult to tell which industries may see an increase in minority vendor involvement. Today, the road and highway construction industry, for example, seems to have greater quantities of minority firms than their numbers might otherwise justify. If that is true, that industry could see a lowering of minority firm involvement under this new government program. Other industries such as aerospace, environmental restoration and manufacturing may see an increase in future minority vendor involvement. For now, those are speculations. We wonít really know until Commerce tells us what it has determined in its study.

1996 Minority Set-Asides (Billions)

Classified and Employment Ads

Sometimes, it pays to advertise. On the other hand ...

Here are some actual ads which have appeared in U.S. newspapers.

• Illiterate? Write today for help.
• Man wanted to work in dynamite factory. Must be willing to travel.
• 3-year old teacher needed for pre-school. Experience prefer-red.
• Girl wanted to assist magician in cutting-off-head illusion. Blue Cross and salary.
• Used Cars: Why go elsewhere to be cheated? Come here first.
• Wanted. Man to take care of cow that does not smoke or drink.
• Wanted. Hair cutter. Excellent growth potential.
• Our experienced Mom will care for your child. Fenced yard, meals, and smacks included.
• Auto Repair Service. Free pick-up and delivery. Try us once, you'll never go anywhere again.

Portability of Benefits Regulations Issued

The Department of Labor has issued new regulations, in conjunction with the Departments of the Treasury and Health and Human Services. Together they have told us how we are to implement the Health Insurance Portability and Accountability Act (HIPAA) of 1996.

If you are an employer offering health benefits to your employees you will want to learn more about these new regulations.

Beginning June 1, 1997, employers must comply with these new rules. We have summarized the key requirements in a four-page report which is available on our FAX-BACK system as document number 265. It includes the DOL certificates you must use in notifying employees of benefit plan changes or their existing/former group health plan coverage. The employee notice you must send is also included in that document.

To obtain your copy, call 510-671-0412 and follow the verbal instructions. (We are sorry, but this service is available only to those within the United States. International FAX calls will be billed to the requesting party for the cost of the FAX transmission plus a US$50.00 service and processing fee per call.)

New Civil Rights Law Proposed by Clinton

On April 24th, President Clinton encouraged Congress to pass legislation which would ban sexual orientation discrimination in the workplace.

Although this is not the first time such protections have been proposed in Congress, it does seem to be gaining more support with each passing year. Originally, the Employment Non-Discrimination Act (ENDA) was introduced to Congress in 1994. Last year (1996) it was debated again and failed by a single vote in the Senate. The House did not vote on the measure at that time.

This legislation would amend the Civil Rights Act of 1964, Title VII, to include sexual orientation in the list of categories protected against employ-ment discrimination.

Congressional leaders Sen. Edward M. Kennedy (D-Mass), Sen. Joseph I. Leiberman (D-Conn), Sen. Mary Landrieu (D-La) and Sen. Alfonse DíAmato (R-NY) are co-sponsoring the bill this year and expect it to be introduced in the near future.

Workplace discrimination based on sexual orientation is already outlawed in twelve states. An additional 133 city and county jurisdictions have passed their own legislation which prohibits such discrimination.

States offering protection include: Connecticut, Washington DC, Hawaii, Massachusetts, Minnesota, New Jersey, New Mexico, Rhode Island, Vermont, and Wisconsin. Both New York and Pennsylvania prohibit such workplace discrimination for the public sector only.

If passed as proposed, ENDA would apply to private employers of 15 or more workers and civilian workers employed by the military. Exempted would be small businesses, the military, and religious institutions.

Attention California Employers ...

If you have been a reader of The Advantage for the past ten years, you know that we have made it a policy to only report on new legislation which has become law. Our reasoning is, the volume of proposed legislation can be overwhelming and much of it doesnít survive through the legislative process. Employers really only need be concerned about compliance when laws have become effective.

We are making an exception to our own policy for the first time. Our reason is simple. A great many bills have been submitted to the California Legislature, in both houses, which would have strong impact on employers of all size. Most of the impact would be bad from the business perspective. We feel you deserve the opportunity to hear about these proposals and voice your opinion one way or the other.

Here, then, are some of the two dozen bills currently being debated in California:

• AB 310 (Kuehl) - New Definitions to the Fair Emp-loyment and Housing Act (FEHA) Adds new definitions to the FEHA including "gender identity discrimination; hostile work environment sexual harassment; and reasonable accommodation for pregnant employees," among other provisions. AB 310 also removes FEHA's $50,000 cap on damages and administrative fines, making employer liability basically the same as in civil court. According to the California Chamber of Com-merce, "this removes any incentive for employers to use the administrative route and makes the Department of Fair Employment and Housing, in effect, obsolete."
• AB 15 (Knox) / SB 680 (Solis) / AB 1167 (Floyd) - Employment: Overtime. AB 15 and SB 680 will make the 8-hour day standard in the state. They will also raise the salary base for managerial employees (to qualify for FLSA exemp-tion), and eliminate "un-workable workweek schedules" from the Industrial Welfare Commission (IWC) work orders. AB 1167 will rescind action taken by the IWC to eliminate overtime payments in excess of 8-hours per day. (The IWC action ordered return to the federal standard of requiring overtime after 40 hours in a workweek.) (See page 1 story)
• AB 1570 (Burton) - Mandatory Severance Pay. Mandates payment of severance allowance to all employees whose work location either closes or relocates more than 100 miles away. The California Chamber of Commerce esti-mates, using U.S. DOL data, that a 100 employee facility with 60 employees meeting AB 1570ís requirements would have to pay out $35,779.20.
• SB 902 (Lee) - Living Wage Contracting Act. Requires businesses contracting with the state, or receiving state aid, to pay its employees at least $7.50 per hour plus health benefits. If no benefits are offered employees, the minimum wage required would be $9.50 per hour. The Chamber forecasts elimination of most small businesses from state contracting opportunities as a result.
• AB 480 (Knox) - Mandated Use of Sick Leave. While sick leave is not a required benefit, if employers do offer it to employees, this bill would permit employees to use their sick leave to tend a sick spouse, child, parent or any other person living in their household. It provides for severe penalties and fines for employers who do not comply.
• SB 202 (Solis) - Unemploy-ment Insurance (UI): Employer Tax Increase. Raises the floor of wages subject to UI taxes from $7,000 to $20,000 - potentially raising employer UI and Employment Training Tax payments by $2.4 billion. This bill also provides for dependents of UI claimants to receive $25 per dependent per benefit check up to a maximum of $100 per week. This will cost an additional $415 million a year.
• SB 233 (Solis) - UI Benefits: Quit for Cause. Allows two new circumstances for employees to quit for cause and be eligible to collect UI benefits: 1) Frequent and repeated requirements to work more than 8-hours per day, or because of a requirement to work regularly scheduled work-days of more than 8 hours; and, 2) Inability to obtain child care.
• SB 901 (Lee) - Listing Job Openings. Provides a 15% surcharge on an employer's UI tax rates for each failure to list job openings with the Employ-ment Development Department (EDD) within seven days, or for refusing referrals from EDD.
• SB 164 (Solis) - State Disability Insurance (SDI) Benefits: Family Leave. Would pay for family leave time in some cir-cumstances. EDD estimates an increase in SDI program costs of $375 million per year. Taxes for SDI could increase $2.5 billion over 3 years.
• AB 1015 (Knox) - Be a Manager, Go to Jail. Raises fines to $250,000, plus up to a year in jail for an employer or manager who violates OSHA provisions causing the death or permanent or prolonged impair-ment of an employee. If it is determined that the employer or manager could "reasonably foresee" the death or injury of an employee, the employer is subject to a fine of up to $1 million, plus a year in jail.
• AB 956 (Figueroa / SB 570 (Solis) - Workers' Compensa-tion Benefit Increase. Would increase employer costs for benefits over the next three years by $1.5 billion.

Age Bias When Retirees Terminated as Consultants?

The Age Discrimination in Employment Act (ADEA) allows employers to avoid liability for illegal discrim-ination if the reason for their actions was based on reasonable factors other than age (RFOA).

That saved AT&T recently when a federal judge in Philadelphia dismissed an age claim filed by a systems technician for AT&T. (Geiger v. AT&T Corp., DC EPa, No. 96-1228, 4/17/97)

Geiger took his retirement in September 1986, after working for the Bell System since 1953. Later, he claimed his decision to retire was based on his manager's promise that he could be rehired as an outside contractor. As an employee, he worked at AT&Tís microelectronics facility in Allentown, PA. After retirement, he was hired back through an outside consulting company and joined the consulting company's payroll, but worked at his old AT&T facility reporting to his former boss.

In March 1993, a supervisor cited a new company policy as the reason for its inability to continue to employ Geiger as a contractor. The supervisor showed Geiger the policy letter which would not permit AT&T retirees in any AT&T microelectronics building after the end of that month. The company claimed that the policy banned all former employees from working as outside contractors, not just retirees.

Geiger failed to present any factual support for his view that the AT&T policy affected retirees alone. According to the court, Geiger must establish the fact that AT&T used the the relationship between retirement status and age as a shield to terminate retireeís contracts because of age.

OFCCP Requests $68.7 Million Budget

The Labor Departmentís Office of Federal Contract Compliance Programs (OFCCP) has submitted a budget request to Congress totalling $68.7 million and 823 full-time equi-valent positions (FTE) to run its oversight and enforcement programs during the 1998 fiscal year beginning October 1, 1997. That represents an increase of $8.55 million over the current fiscal year.

OFCCP is charged with enforcing EEO and affirmative action requirements with over 200,000 federal contractors around the country.

The agency plans to spend its added funds, if approved, on new EEO initiatives and additional information technology. Part of the expanded program will include more technical assistance for contractors with added seminars, workshops and technical assistance guides. Information technology updates will allow the OFCCP to accept contractor data electronically when submitting AAP data for compliance review.

The agency has labeled its new initiatives, "Fair Enforcement Strategy." It includes three parts:

Regulatory reform to reduce the paperwork burden on contractors by revising AAP content requirements. (Editor: Some current proposals would increase contractor work load.)

Tiered review process to increase quantity of compliance reviews completed each year.

Technical assistance on preventing sex harassment, resolving glass ceiling problems at higher levels of management, preventing national origin discrimination, and improving services for Vietnam-era and special disabled veterans.

New Federal Employee Registry

Late last year Congress enacted and the President signed the Personal Responsibility and Work Opportun-ity Act. In a few weeks, this law will begin to exercise its influence over both employers and employees.

Beginning on October 1, 1997, states which have not yet collected infor-mation about newly hired employees will have to begin maintaining directories of that information. Most employers will have to report their newly hired employees to these state directories within 20 days after the hire date. All states are required to pass their own laws to comply with these federal provisions.

In states which already have such data directories and reporting requirements in place, the current system will continue to operate until October 1, 1998.

These requirements have been established to assist in tracking parents who owe child support. If you have employees in more than one state and you report magnetically or electronically, you may choose to report to only one state. If you elect this option you must submit your reports twice a month, 12 to 16 days apart. You must also give written notification to the Secretary of Health and Human Services and the state to which you will be reporting.

Penalties for failing to report a new employee can be as much as $25 per person under the federal law. A fine of $500 may be assessed for conspiracy not to report or conspiracy to report inaccurately.

States are required to enter all new-hire information into their directories within five business days after receiving it from employers. It is in this computerized environment that new employee records will be compared with the Child Support Enforcement Masterfile of cases to find matches based on social security numbers of non-paying parents. All states will be required to submit their new-hire information to the national directory within three business days after entering it into their systems. This centralized gathering of data will allow tracking of delinquent parents who work in other states.

If one of your new employees is determined to be a non-paying parent you will be sent a wage-withholding notice within two business days. All states must also comply with the Uniform Interstate Family Support Act (UIFSA) which allows employers to implement withholding orders issued in another state without having the order endorsed by a court in the employer's state.

If you act upon a withholding order under these laws you will have seven business days after payday to submit the withheld wages. There will be an option for electronic submission.

The notice (withholding order) will be coming to you on a form which has yet to be developed. It will indicate whether the order for payroll withholding on the cited employee is new or revised. It is supposed to contain voice telephone and fax numbers you can use if you have any questions about the specific order.

Employers who primarily operate in California must currently report new hires to the Employment Development Department on form DE34 within 30 days of adding the new person to the payroll. Currently, employers with four or fewer workers are exempt from reporting requirements. Current categories of employers required to file include:

• Landscape & Horticultural Services
• Building Construction - General Contractors & Operative Builders
• Heavy Construction other than Building Construction - Contractors
• Construction - Special Trade Contractors
• Motor Freight Transportation & Warehousing
• Water Transportation
• Wholesale Trade - Durable Goods
• Wholesale Trade - Nondurable Goods
• Automotive Dealers and Gasoline Service Stations
• Eating & Drinking Places
• Holding & Other Investment Offices
• Hotels, Rooming Houses, Camps, and other Lodging Places
• Business Services (SIC 7300-7399)
• Auto Repair, Services and Parking
• Motion Pictures
• Health Services
• Engineering, Accounting, Research, Management & Related Services (SIC 8700-8799)

You can expect to receive additional information from your state employment service or state taxing agency before the implementation deadline of October 1, 1997.

New Ergonomics Safety Standards In California

Over the past three years, there have been many false starts to implementing workplace safety regulations covering ergonomic standards. It has literally been an on-again, off-again sort of progress. Well, we're on-again.

Another first for California. On July 3, 1997, it will become the first state in history to regulate repetitive stress injuries in the workplace. Repetitive Stress Injury (RSS) is sometimes referred to as Carpal Tunnel Syndrome (CTS), Repetitive Motion Injury (RMI), or Cumulative Trauma Disorder (CTD).

The legal battle over these new state standards for workplace ergonomics has yet to be resolved. Labor organizations claim that the new standards are too weak and filled with loop-holes. Trucking industry associations have also taken action to block the new standards. They claim too little is known about repetitive motion injuries to justify the new regulations, which they say will be unnecessarily costly. Both sides, labor and the trucking industry, will present their arguments at a Sacramento County Superior Court hearing September 5th, two months after the new orders go into effect.

Even though the battle is not yet over, the trend is very clear. You can expect other states to follow in California's path toward greater regulation of the workplace. Ergonomics injuries have been a particularly costly category for California employers in recent years. During the first half of this decade, CTDs represented the fastest-spreading occupational ailment. That seems to have changed a bit since 1995. The national rate of new cases reported has fallen by seven percent according to the U.S. Occupational Safety and Health Administration (OSHA).

Provisions of New Standards

Title 8, General Industry Safety Orders

Section 5110, Ergonomics

Applies to employers with 10 or more workers. Employers with 9 or fewer workers are exempt.

Applies to "a job, process, or operation" where a repetitive motion injury (RMI) has occurred to more than one employee under the following conditions:

1) The RMI was caused 50% or more by a repetitive job, process or operation;

2) The injured employees were performing a job process or operation involving the same repetitive motion task;

3) The RMIs were diagnosed by a licensed physician as musculoskeletal injuries;

4) The RMIs were reported within the past twelve months (but not before July 3,

1997).

All employers with ten or more workers in California must comply with these new requirements beginning July 3rd.

1) Each job in the workplace shall be evaluated to determine exposures which have caused RMIs.

2) Any exposure which has caused RMIs shall be corrected. If it can not be corrected it must be minimized.

Employers must consider engineering controls (such as workstation redesign, adjustable fixtures or tool redesign) and administrative controls (such as job rotation, work pacing or work breaks).

3) All employees must receive training on all of the following:

• The employer's program.
• The exposures which have been associated with RMIs.
• The symptoms and consequences of injuries caused by repetitive motion.
• Methods the employer will use to minimize RMIs.

According to the Society for Human Resource Management, Carpal Tunnel Syndrome (CTS), a potentially debilitating condition resulting from compression of the median nerve in the wrist, can cost $20,000 per case if treated with surgery. If the employee is unable to return to work after the surgery, the costs go even higher.

It only takes one of these cases to increase an employer's workers' compensation insurance rates. And, the payment goes on long after the employee has recovered and returned to work.

Employers would be well advised to prepare themselves for the new regulatory standards by

performing a self-assessment of their workplaces if they have had any RMIs on any of their jobs.

Office Safety Plan Available

California safety regulations require every employer to have a written Injury and Illness Prevention Program (IPP). If you have ten or more workers, you must include ergonomics issues as part of that safety program as of July 3, 1997.

If you need help, we have it available. Our 140 page SAFETY PLAN for the normal office environment includes both ergonomics and prevention of workplace violence, as well as other required content. Each SAFETY PLAN binder comes with all the forms you will need to track implementation, including quarterly employee training. You can "fill in the blanks" on the model IPP document, or you can modify it as your workplace requirements dictate. Each binder comes with a BONUS 3.5" disk (IBM PC compatible format only) which contains the complete IPP narrative in both Word 6.0 and ASCII formats. You can import this information to any word processor and format it for printing on your own computer. Thirteen forms are also included on the disk in Word 6.0 format, and in the binder to help you record your compliance actions.

To order, call our toll-free order line: 1-888-671-0404 or Order Online.

Ask for Order Number 706. Cost is $99.95 plus $7.00 shipping/handling. California sales tax of $8.25 will be added to all orders shipped to California addresses. Have your credit card ready when you call. We accept VISA, MasterCard, American Express and Discover cards.

Even if you are not a California employer, this program can provide many benefits in your workplace. Improve your employee communication and let your workers know you care about their safety. Order your copy today.

OFCCP and Veteransí Employment and Training (VETS) Forge Agreement

The Office of Federal Contract Compliance Programs (OFCCP) and the Veterans' Employment and Training Service (VETS) have reached an agreement which will ensure more efficient use of enforcement resources, reduce duplication of effort and provide for building outreach activities.

OFCCP and VETS will work together on training and providing information to employers, veteransí groups, state employment service offices and the general public. They will also share EEO-1 and VETS-100 data, verification of job listings, complaint information and reporting of complaints filed under the Vietnam Era Veterans Reemployment Rights Act (VEVRRA).

While the OFCCP focus is on enforcement of affirmative action regulations for federal contractors, VETS has primary responsibility for administering grants to states to fund veteransí program specialists employed in State Employment Security Agencies, and grants under Title IV-C of the Job Training Partnership Act.

OFCCP Expanding Tester Program

While the Equal Employment Opportunity Commission (EEOC) has been using a tester program for many years, its sister agency, the Office of Federal Contract Compliance Programs (OFCCP) is just beginning to use the same approach to identify employment discrimination.

A pilot program in the agency's Region III sent white and black male job applicants with similar backgrounds into federal contractor work places in the Washington, DC area. This pilot program uncovered different treatment of white and black applicants, specifically in the banking industry. The pilot program gave the OFCCP information about who was selected for job placement. It also revealed differences in how job applicants were treated based on their race.

A report on results of this pilot program concluded that use of "testers" is a good way to determine when employers illegally discriminate in their employment process. Originally, both financial services and transportation and delivery industries were supposed to be included in the pilot program along with the banking industry. The banking industry was the only one of the three which was hiring new employees as the pilot began, however. Therefore, the pilot only involved banks in the Washington, DC area.

Fifteen branch locations of ten separate banks were targeted. Black and white testers both filled out applications in person at 12 of the 13 locations after contacting the banks by phone. Follow-up calls resulted in both testers getting interviews with six branches, but not at the same locations. Only four branches interviewed both testers. The white tester received three job offers from three eparate employers while the black applicant received one. In one case, a bank interviewed the black tester, but offered a job to a white tester who had not even been interviewed. In a different branch of the same bank, the black tester was offered a job while the white applicant was not, and neither were interviewed.

This program is now being expanded into Chicago (Region V) and San Francisco (Region IX). In Chicago, tests will involve Hispanics. In San Francisco, tests will involve women. Expect that focus will not be on who gets hired, but how applicants are treated. Details of which industries will be targeted in these expanded geographies have yet to be worked out. All federal contractors should be forewarned that they may be subject to this program. Doing a quick internal review of your employment processing systems may be a good idea. Part of that review could include reminding everyone involved in the process that equal treatment is the objective.

If you wish more information about the OFCCP's report on the preliminary Washington, DC testing program it is available on the Web at: http://www.dol.gov/dol/esa

Domestic Partner Regulations In San Francisco

Some of you conduct business with the City and County of San Francisco. When you do, you become subject to the City regulations on domestic partner benefits. This has become an issue even for employers such as United Airlines and Delta Airlines recently. With employees working in leased space, these organizations have had to agree to comply with the ordinance. The Air Transport Association has filed a federal suit challenging the ordinance (Air Transport Association v. City and County of San Francisco, DC Ncalif, 5/13/97). The Association is claiming that San Francisco is violating the Employee Retirement Income Security Act (ERISA), the Railway Labor Act, the Airline Deregulation Act, and the U.S. Constitution in attempting to regulate airlines in the provision of benefits. Its spokesperson said the Association took this action because airlines have always been governed by federal, not local, laws. Itís position is a national transportation system requires one regulatory master and can not possibly hope to comply with hundreds of varying local demands in jurisdictions across the nation. Other private sector employers have said they will extend benefits to domestic partners. Among them are Chevron, Pacific Gas & Electric, Bank of America and the San Francisco 49ers football franchise.

In summary, requirements are that employers provide domestic partners the same level of benefits offered to employees' marriage partners. Treatment of coverage, processing and eligibility must be the same for both groups. Employers may require workers submit an "Affidavit of Domestic partnership" if they also require workers to provide a copy of a marriage license to obtain benefit coverage for spouses. Domestic partnerships may be same-sex relationships or opposite-sex relationships.

Domestic partnerships are only valid under the ordinance if duly registered with a governmental domestic partner registry. According to the San Francisco Human Rights Commission, the

following governmental entities offer domestic partner registries:

Additional information is available from the Web at:http://www.sfhumanrights.org/lgbth

A Gentle Word on Behalf of Our Business

When you need help developing your affirmative action program, give us a call. We specialize in AAP development, implementation training and compliance review support for clients all over the country.

You wouldn't go to an IRS audit alone. Why think about going into a Department of Labor compliance review without professional support? The stakes are just as high either way.

We are ready to give you the support you need.

And while youíre at it, think about ordering a copy of our reference and training book on preparing affirmative action plans and managing compliance reviews. You will find it an invaluable resource at a price that just canít be beat.

Secrets of Affirmative Action Compliance, new 2nd edition, over 450 pages of regulation requirements and practical suggestions for your organization. Includes new Federal Regulations. $99.95 plus $7.00 shipping/handling and CA sales tax for CA destinations. Credit Card Orders ... Call Toll Free: 1-888-671-0404 or Order Online.

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• Employee Handbooks
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• Affirmative Action Plan Development
• Affirmative Action Statistical Analysis
• Disparate Impact Testing for New Hires, Promotions, Transfers, Terminations

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