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New Rules Prohibit Discrimination On The Basis of Sexual Orientation and Gender Identity

March 26, 2015

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The Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) published a Final Rule on December 9, 2014, implementing Executive Order 13672, which prohibits federal contractors and subcontractors from discriminating against individuals on the basis of sexual orientation and gender identity. In accordance with the treatment of depository institutions under Executive Order 11246, the mere existence of federal deposit insurance is sufficient for a bank to be deemed a federal contractor under Executive Order 13672, without regard to the number of employees or other contractual relationships with the federal government. The new rule will take effect April 8, 2015.

Although the new rule does NOT include new reporting and information gathering mandates or require contractors to set hiring goals, it does require federal contractors and subcontractors (and thus all insured banks) to:

  • Update Contracts.  Contractors must update the equal opportunity clause in new or modified subcontracts and purchase orders to include sexual orientation and gender identity as protected characteristics.
  • Update Job Solicitations.  Contractors must update the equal opportunity language included in all job solicitations to notify applicants that they will not be discriminated against on the basis of their sexual orientation or gender identity.
  • Ensure No Discrimination. Contractors must take steps to ensure that job applicants and employees are not discriminated against because of their sexual orientation or gender identity.
  • Post Updated Notices.  Contractors must post the new supplement to the EEO is the Law poster as soon as it is available on the OFCCP’s website.
  • Ensure No Segregation.  Contractors must ensure that facilities provided for use by their employees are not segregated on the basis of sexual orientation or gender identity.
  • Notify OFCCP/State Department.  Contractors must immediately notify the OFCCP and the State Department if they believe they cannot obtain a visa for an employee to a country in which, or with which, they do business because of the employee’s sexual orientation or gender identity.
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Regulators Propose Statement on Diversity Policies

December 10, 2013

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Throughout 2012 a series of roundtable discussions were held in order to assess the current diversity programs and polices in place within the financial industry. As a result of these talks, six financial agencies: the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Consumer Financial Protection Bureau, and the Securities and Exchange Commission (the “Agencies”), proposed a set of diversity and inclusion standards. These standards, titled the “Proposed Interagency Policy Statement Establishing Joint Standards for Assessing the Diversity Policies and Practices of Entities Regulated by the Agencies and Request for Comment” (the “Policy Statement”), were published on October 25, 2013, with the 60-day comment period to end on December 24, 2013.  This Policy Statement helps to implement a part of the Dodd-Frank Act, which requires each financial agency to establish an Office of Minority and Women Inclusion, and assign a director who is responsible for all agency matters relating to diversity in management, employment, and business activities.

What the Proposed Standards Will Do

The proposed Policy Statement sets out uniform standards for regulated entities in four key areas: (1) organizational commitment to diversity and inclusion; (2) workforce profile and employment practices; (3) procurement and business practices and supplier diversity; and (4) practices to promote transparency of organizational diversity and inclusion.  The Agencies advise that each standard will be tailored to the regulated entity’s size and other relevant characteristics such as total assets, number of employees, geographic location, and community characteristics. Entities that are affected by the Policy Statement include financial institutions, investment banking firms, mortgage banking firms, asset management firms, brokers, dealers, financial services entities, underwriters, accountants, investment consultants, and providers of legal services.

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