Another Government Mandate

Last December, the Director of the Labor Department’s Office of Federal Contract Compliance Programs, Patricia Shiu, proposed, in all seriousness, a regulation requiring companies, apparently with 50 or more employees, to adopt a 7% hiring quota for disabled job applicants or be debarred from doing business with the federal government.  Note that this isn’t 7% of the total number of employees—Ms Shiu is a better micromanager than that.  This is a quota of 7% in each separate job category: “one or more jobs with similar content, wages rates, and opportunities.”

Moreover, Shiu’s rule attempts to require companies to encourage all job applicants to label themselves as “disabled” prior to being hired—apparently without any screening of applications or applicants for accuracy of the claim—and to require companies to engage in an ongoing compliance regime: companies must encourage all employees “to label themselves disabled after being hired, and once a year thereafter,” again apparently without any regard for the accuracy of such self-labeling.  Additionally, the rule would require each company to document, in detail, for each applicant not hired, why that applicant was not hired.  I wonder whether “Because I already hired someone for the position” would be acceptable.  On top of this, each company would be required annually to (re)justify and to  (re)document “the physical and mental job qualifications for [every] job opening…and to provide an explanation as to why each requirement is related to the job to which it corresponds” and to prove each requirement to be “consistent with business necessity.”

Labor’s estimate of the cost of compliance is cynically understated by two orders of magnitude: they claim a cost of just $81 million for roughly 200,000 companies to comply—a cynical $400 per company.  HR Policy estimates the true cost (not counting productivity costs, which are much harder to estimate) to be in the region of $1.8 billion—a more realistic $9,000 per company.  Of course, not included in Labor’s estimate is the cost of hiring all those bureaucrats into Ms Shiu’s burgeoning empire to monitor compliance.  Nor is the cost of all the lawyers companies will have to retain to defend themselves against all the litigation such a rule is going to encourage.

What constitutes an eligible disability?  Reading, concentrating, thinking, communicating, and interaction with others all are on the list.  I have to wonder at the productivity costs of having to have folks on the payroll specifically to read instructions to employees who can’t read; to do so repeatedly to employees that can’t concentrate long enough to absorb the instructions; to monitor employees who can’t concentrate long enough to complete the job assigned; to guide employees who can’t think clearly enough to understand the instructions they’ve just read or had read to them, or to figure out a task when no monitor is readily available; who can’t explain the trouble they’re having to their peers or supervisors; or who don’t get along with their peers or supervisors.

Oh, and hypocrisy notice: the Federal government itself has only 5% disabled on its payrolls—and the Labor Department’s percentage of disabled employees has decreased every year since President Obama took office, despite Obama’s sharp increase in Labor hiring.

There went the “opportunities.”  Why would a company hire at all in such an environment?  Sounds like a good reason to decline to do business with the Federal government.

Leave a Reply

Your email address will not be published. Required fields are marked *