A key federal contracting overseer put law firms on notice that the government is paying attention to the diversity gap in the legal industry.

Craig Leen, the director of the Office of Federal Contract Compliance Programs, told industry representatives at a town hall meeting in New York that the scarcity of women and minorities at firms in leading roles has been noted by the office, and it will be taking a closer look.

“There is evidence of low representation at law firms and financial firms, and our goal is to fix it and work with them to do so,” Leen said in a brief interview after Wednesday's meeting. ”This is the beginning of the process.”

The OFCCP, part of the Labor Department, administers and enforces laws that make it illegal for federal government contractors and subcontractors to discriminate in employment on the basis of race, color, religion, sex, national orientation, gender identity, disability or veteran status. It audits companies for compliance and can take enforcement action, including negotiating conciliation agreements and imposing sanctions including monetary relief and terminating government contracts.

Leen, a former Coral Gables city attorney, said his office looks at systemic issues, “and we are seeing serious issues.”

Last month, the Office of Federal Contractor Compliance Programs published its new corporate scheduling announcement list of 3,500 contractors and subcontractors who may be subject to a compliance evaluation in Fiscal Year 2019. Law firms on the audit list included Ballard Spahr; Fox Rothschild; Haynes & Boone; Mayer Brown; Morgan, Lewis & Bockius; Paul Hastings; and Pillsbury Winthrop Shaw Pittman.

The OFCCP gathering included representatives from the Labor Department, Equal Employment Opportunity Commission and other government agencies, as well as from law and other professional services firms and human resources specialists.

Questions posed by government officials included how are firms addressing the low representation rates of women, minorities and minority women at the partner levels; how do firms review their  level of people with disabilities, how do billable hour requirements accommodate family leave and how do firms ensure men and women are treated the same on family leave policies?

Another pointed question: “How can OFCCP address concerns in disclosing information on equity and non-equity partnership numbers for women and minorities to OFCCP?”

Hiring and promotion of women in law firms and legal departments has been a concern of the legal industry, with study after study showing a sharp drop in the number of women partners at firms and in-house departments after achieving parity in law school enrollment and near parity as early associates. Women have filed gender discrimination claims against firms including Morrison & Foerster, where plaintiffs complained of a “mommy track” for women, and Jones Day, where plaintiffs described a “fraternity culture.”

As some law firm representatives noted, however, members of some minority groups continue to be underrepresented even in law schools, presenting additional obstacles.

Leen made clear his support for equitable family leave programs, saying the lack of support from the top for family leave policies is likely responsible for at least some of the disparity in women's outcomes at firms.

Before joining the OFCCP, Leen held the titles of city attorney, general counsel and chief legal officer in Coral Gables, according to his OFCCP biography. He was also on the constituency board for the University of Miami‐Nova Southeastern University Center for Autism and Related Disabilities.

“Leadership at the top is important,” Leen said.

When some law firm representatives raised a question about applying equal employment laws, Leen made it clear that the OFCCP regards associates as employees under its purview and associate promotion rates to partner would be subject to OFCCP review.

“We are going to be looking at that,” Leen said. “We are very keen on the issue of promotions.” He said the office would be issuing guidance soon.

On March 25, OFCCP published an updated list of 3,500 contractors and subcontractors that may be subject to a compliance evaluation. Some attorneys said federal contracts were a small percentage of law firm revenue, and they might skip the business if reporting and compliance requirements were too burdensome.

Recommendations floated by working groups at the event included reducing billable hour requirements for transitioning parents, giving time credit for activities such as mentoring diverse associates and enhanced leave policies to address life situations broadly, not just parental leave.

Leen said the OFCCP would be paying close attention in the coming months to compliance with anti-discrimination laws in the legal, financial services, tech and higher educator sectors. Town hall meetings with the tech industry were held earlier this year.

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