On October 30, 2024, a Texas federal court issued a preliminary injunction to halt an enforcement action by the Office of Federal Contract Compliance Programs (OFCCP) against ABM Industry Groups, LLC, a federal contractor. This case, while directly impacting only one contractor, could have significant implications for the broader landscape of OFCCP enforcement through Administrative Law Judges (ALJs).

Highlights:

• Legal Challenge: The contractor argued that the ALJ proceeding violated constitutional principles, citing the Seventh Amendment right to a jury trial and Article II concerns regarding the President’s ability to remove ALJs.
• Court’s Decision: The court agreed on the Article II challenge, finding that two layers of for-cause removal protections for DOL ALJs violated the President’s authority.
• Impact: The ruling temporarily halts the OFCCP action but applies solely to this contractor’s case. If similar challenges gain traction, it could reshape how federal contractors engage with OFCCP enforcement actions.

This case underscores the evolving legal landscape for federal contractors and their compliance obligations. Read the full analysis and implications for contractors here.