Posted on January 12, 2012 by David Oxenford

More EEO Fines on Their Way - And Helpful Hints on EEO Compliance From the FCC's EEO Webinar

Last week, I participated in an FCC-sponsored webinar to discuss its EEO rules.  Along with two other private firm lawyers, the chief of the FCC's Office that administers its EEO rules and one of his senior staff members participated on a panel to discuss the legal obligations of broadcasters and MVPDs in meeting the EEO rules.  The panel, which lasted almost two hours, was a very thorough discussion of the requirements of the FCC rules.  It provided insight into how the FCC identifies problems, and even suggested some ideas as to how broadcasters can assure compliance with the requirements in the easiest way possible.  While lengthy, the webinar, which is archived on the FCC's website, is worth viewing to get a very good summary of the FCC rules.  If a station or MVPD has its management employees and others with hiring responsibility sit down and watch the video, and use it as part of a training program for management employees on EEO matters, it may even count as one of the non-job specific supplemental outreach initiatives that the FCC requires each entity subject to the EEO rules to conduct.

We wrote last week about a recent set of FCC fines to two broadcasters that had not widely disseminated information about all of their job openings - relying instead on only a combination of internal sources (word-of-mouth, station websites, intra-company referrals) and Internet websites for their outreach efforts for a substantial number of job openings.  At the webinar, the FCC officials said that there were a number of other enforcement actions in the pipeline that should be public soon.  The FCC is reviewing every license renewal application that is filed with the FCC to determine if its accompanying Form 396 provides information necessary to demonstrate compliance with the three prongs of the FCC's EEO program - wide dissemination for all job openings, notice of job openings to community groups that request such notice, and non-vacancy specific initiatives that are designed to educate a community about the nature and requirements of broadcast jobs.  Stations are also reviewed when the FCC conducts random audits (5% of all stations and MVPDs are supposed to be audited annually) and when complaints or other information comes to the attention of the FCC staff.  Staff members remarked that they have even called stations to discuss issues when visiting a station website for personal reasons and noting the absence of the most recent Annual EEO Public File Report that needs to be posted on a station website on the anniversary date of the filing of the license renewal applications for stations in the state of the station's city of license. 

While there was discussion about the Internet issue, and whether, in today's world, the Internet had become the one easy way to reach all groups within a community (replacing the large daily newspaper whose classified ads the FCC used to look at as the safe harbor for broadcasters to use for their wide dissemination of information about job openings), the FCC staff indicated that there was no movement within the Commission currently on the horizon to change their current position.  However, the FCC staff members offered a willingness to reevaluate the issue if they were presented with information about the pervasiveness of online job searching.  In the interim, broadcasters need to reach out to all the significant community groups in their area with information about job openings using these more traditional sources, like the local newspaper and direct outreach to community groups through direct emails or letters.  All the panelists agreed that making at least some personal contact with outreach groups - including local colleges and trade schools, minority and community organizations, employment agencies and others - helps to make the outreach effort more effective.

We also discussed the "internal promotion" exception to the wide dissemination requirement.  If a station wants to promote a current full-time employee, no recruitment is necessary (the assumption being that if, for instance, a sales person is promoted to sales manager, there would be an opening for a new sales person, and recruiting for that open position would take place).  Promoting a part-time or temporary employee to a full-time position can take advantage of this internal promotions exception, if the part-timer or temp was hired using wide-dissemination.  While there is an old proceeding outstanding about whether or not to extend the wide-dissemination requirements to part-time hiring, at this point the FCC staffers indicated that no decision was imminent.  But, obviously, using outreach efforts to fill part-time positions is advantageous so a part-timer can be promoted to full-time without the outreach efforts if they prove to be a valuable employee.

There was also much discussion about the non-vacancy specific employment initiatives, or supplemental efforts, that stations need to conduct to comply with the FCC rules.  These supplemental efforts are conducted by all broadcast employment units with five or more full-time employees, whether or not the station has any job openings.  The idea is that stations help to educate the public about the types of jobs available at a station, the qualifications for those jobs, how to find out about those jobs.  Also counted are programs to train existing employees to acquire new job skills.  The FCC staffers on the panel seem to take an expansive view of these efforts - evidencing a willingness to count any meaningful activity where station employees take on this educational role.  Credits or partial credits can be obtained for employees speaking at schools, for station visits by boy scout troops, for station promotional efforts in the community where some information is provided to attendees at the event about broadcast employment issues, and (in some instances) for training of existing station employees.  Internships have always been a staple of meeting these supplemental efforts requirement and, as the efforts are judged on a two year period, the FCC staff saw nothing wrong for claiming credit for two separate internship programs where there was recruitment at different times.  In other words, if you have an intern in the fall semester, and then recruit at a school for an intern who you host in the spring semester, the FCC staff seemed open to counting this for two credits.  But, as I warn broadcasters at all EEO seminars that I do, overachieve on these initiatives, as we have yet to see any cases where the FCC formally interprets what does and does not count in connection with these programs.

Documentation and self-assessment were also discussed.  The FCC, in virtually every case where there has been an EEO fine, has also assessed a fine for failure to self-assess the EEO program.  Self-assessment is written into the rules, so stations should be meaningfully reviewing their programs to make sure that they are being properly conducted, all of the required records are being kept, and that the programs are actually producing interviewees from recruiting sources outside of the traditional, in-house sources which the FCC felt that broadcasters in the past relied on too heavily. 

These are but some of the issues tackled during this program, and just some of the issues to be considered in evaluating your EEO program.  For more information about EEO compliance issues, look at some of past articles on this issue, and check out some of our other advisories on the subject.  Our Guide to the FCC's EEO Rules is available here.  Our most recent advisory about the requirements for the annual public inspection file report is available here.  And slides from a recent presentation that I did about these rules for a state broadcast association are available here. 
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Posted on January 1, 2012 by David Oxenford

FCC Fines Up to $14,000 Proposed for License Renewal EEO Violations, Commission To Hold Webinar to Explain Its Rules

Fines of $14,000 and $8,000 were proposed by the FCC for violations of its EEO rules in two cases (here and here) released on the FCC's last business day of the year.  In both cases, the fines were issued as these clusters of stations, on the FCC Form 396 EEO Reports filed with their license renewal applications, publicized a number of job openings without adequate recruitment.  In the cases faulted by the FCC, the stations' recruitment relied solely on either internal station sources (e.g. word of mouth, referrals from existing employees, ads on the stations or on their own websites) or on on-line resources.  The Commission concluded that this was inadequate dissemination of the information about these openings.  Based on the failure to engage in broad outreach for all of their job openings, these fines were issued by the FCC - perhaps the first of more to come as the FCC reviews license renewal applications during the current license renewal cycle.  Perhaps coincidentally, the FCC will be conducting a webinar on its EEO rules on Wednesday, January 4, which is intended to help explain the obligations of broadcasters and other FCC regulated entities under these rules.

 The January 4 webinar will feature two panels.  The first will be a panel of FCC and private attorneys (I will be one of the participants) who will outline the legal obligations of broadcasters under the FCC's EEO rules and policies and discuss how these rules are applied .  A second panel will feature industry representatives talking about EEO compliance best practices at their stations.  The webinar is free, but requires registration (here).  The FCC public notice of the webinar can be found here, and a further description of the seminar is available on its blog (here).  No doubt, the issues leading to the two fines announced on Friday will be discussed during the legal session.

In both cases, a significant amount of the hiring relied on a limited number of outreach sources. The FCC's rules require broad dissemination of information about all station job openings that do not qualify for some very limited exceptions.  In doing such recruiting, companies must reach beyond their internal sources (what I have characterized in some of the seminars that I've done on this subject as the "old boys network" - see slides from a recent seminar on the EEO rules here), meaning that they can't just rely on word of mouth, referrals from existing employees and the station's own airwaves and websites.  In addition, in prior cases, the FCC has determined that Internet sources cannot be the only sources relied on by a company to supplement these in-house sources, fearing that there are still many potential job-seekers who do not have routine access to the Internet (whether that is still true is open to debate, particularly given the proliferation of job websites that have replaced the traditional newspaper classified ads as the first place that many job-seekers check to look for openings - but it is still the current FCC policy). To comply with FCC rules, broadcasters must reach out to other local groups and organizations with information about their job openings - using other media designed to reach the entire community (e.g. a large daily newspaper), or reaching out to educational institutions and other community groups that represent broad cross-sections of the local community.  As the companies in these cases did not engage in what the Commission considered adequate outreach for all of their job openings (insufficient recruiting was found in 8 of 13 openings in one case, and 5 of 14 in another), the significant fines were proposed. As usually done in these cases, the FCC also faulted the licensees for not doing sufficient self-assessment as they did not catch these problems themselves. 

More information on the Commission's EEO rules is also available from the Davis Wright Tremaine Guide to the EEO Rules, available here.
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Posted on August 2, 2011 by David Oxenford

Another EEO Audit Announced By the FCC - Radio Stations Only

Another EEO audit was announced by the FCC today - hitting about 100 radio stations this time around. The Commission has pledged to audit 5% of all broadcast stations and cable systems each year to assure their compliance with the Commission's EEO rules - requiring wide dissemination of information about job openings and supplemental efforts to educate their communities about job opportunities in the media industry.  Today's Public Notice announcing the audit is here.  The list of stations subject to the audit is here.  The form of the audit letter is available here.  Responses from the audited stations are due by September 12.

All stations should review the audit letter as it provides a good outline of the documents that stations should be retaining to demonstrate their compliance with the FCC's EEO rules.  For more information about compliance with the EEO rules, see our advisory on the basics of the EEO rules, here, and our most recent advisory on the requirements for the annual EEO public inspection file report, here.

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Posted on December 30, 2010 by David Silverman

FCC Imposes Fines Up to $20,000 for EEO Violations

The FCC has issued Notices of Apparent Liability against two radio licensees for apparent EEO violations at their respective station clusters. These NALs, issued on the next to last day of the FCC's business year, are the first to address EEO violations in a year and a half. The common thread in both NALs was the licensee's failure to properly recruit for new hires, relying primarily on "walk-ins" or referrals in lieu of the "wide dissemination" required for information about job openings.  In one case, where the licensee failed to widely disseminate information about 28 job openings, the FCC proposed a fine of $20,000.  In the other case, where the station owner was able to document recruitment efforts for some of its openings, the FCC proposed a fine of $8000 for the six jobs where the required recruitment efforts were found lacking. 

In the first NAL, the $20,000 proposed forfeiture was based on a finding that the licensee failed to properly recruit for 28 of the 29 full-time vacancies filled over a six year period.  Instead, the licensee relied on "walk-ins" and referrals for six vacancies, and used the Internet or on-air ads for 22 vacancies.  These methods alone do not constitute sufficient dissemination of job vacancies under FCC rules.  In a post last year, we explained that the FCC does not consider Internet advertising alone to be sufficient for recruitment purposes, and questioned whether that policy is appropriate in this day and age.

Other violations by this licensee included the failure to keep records of the number and source of interviewees and the resulting violation of FCC rules requiring such information to be kept in the station's public inspection file.  The lack of records meant the licensee could not adequately analyze its EEO recruitment program to ensure that it was achieving broad outreach, also an FCC rule violation.  The combination of rule violations and number of hires involved was found sufficiently egregious to justify a $20,000 forfeiture.

In the second NAL, the FCC found insufficient recruitment efforts for six of 24 job openings.  Rather, the licensee aired "generic" ads about working at the stations, even when there were no specific openings, and hired three of the resulting "walk-ins."  The licensee also hired one employee referred by word of mouth, one from a business referral and one from an employee referral.   Although such hiring methods are not prohibited, the FCC does not consider them to be sufficient public recruitment for the openings that were filled.   Additional recruiting sources must be used to satisfy the FCC's current requirements for "wide dissemination."

Other violations cited by the FCC in the second case included the licensee's failure to list specific job titles in its EEO public file report for seven new hires, all of whom were classified as "other."   In so doing, the licensee also violated the rule that requires information about the jobs filled to be placed in the station's public inspection file.  This NAL resulted in a proposed forfeiture of $8000.

Both licensees have the right to respond and can ask the FCC to reduce or cancel the proposed forfeitures based on the specific facts.  However, these two NALs show that the FCC is once again getting tough on enforcement of its EEO rules and licensees would be well advised to take any steps necessary to insure strict compliance with those rules.  For further information about a licensee's EEO obligations, see our advisory setting out the basics of the FCC's EEO rules and our most recent advisory on the requirements for the annual EEO public inspection file report. 
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Posted on July 8, 2010 by David Oxenford

David Oxenford Reviews EEO Rules with the Iowa Broadcasters, While MMTC Asks the FCC to Suspend EEO Enforcement

As I was preparing for a session updating and refreshing broadcasters about their obligations under the FCC’s EEO rules at the Iowa Broadcasters Association annual convention in Des Moines on June 30, I learned of what seemed to be a startling development – the Minority Media and Telecommunications Council, one of the most effective advocates in Washington for minority hiring and ownership, had urged the FCC to suspend its enforcement of the EEO rules. What was this all about? I went on with my presentation (the PowerPoint slides for which are available here, and the slides for the presentation that I did at another session providing an update on Washington issues for radio broadcasters are available here), quickly adding a summary of the MMTC request. While some broadcasters might have hoped that the request recognized that the EEO rules were no longer necessary as broadcasters were, on their own, making great strides in diversifying their workforce, in fact what the MMTC was seeking was tighter EEO enforcement, contending that the current rules are so ineffective as to not be worth the time spent on their implementation and enforcement.

While MMTC acknowledged that there have been a number of recent cases fining stations for noncompliance with the EEO rules, it contends that often the stations that are hit by such fines have very diverse workforces, and thus should not have to worry about EEO outreach. We have written about some of these fines.  These cases demonstrate that the current rules are not targeted at minority and gender-based affirmative action, as FCC rules requiring any evaluation of minority and gender-based hiring were twice declared by the US Court of Appeals to be instances of unconstitutional reverse discrimination. Instead, the current rules are focused instead on bringing new people into the broadcast employment workforce – people recruited from a wide variety of community groups, and not exclusively by word of mouth or through other hiring avenues that simply take people from traditional broadcast hiring sources. But, as MMTC points out, these rules are not based on necessarily seeking to include members of minority groups or women in station workforces.  Thus, as their focus is simply on wide dissemination of information about job openings, even stations that have high percentages of minorities and women on their staffs can still run afoul of the rules by not publicizing job openings.

So what does MMTC want? Seemingly, in some ways, they are seeing a return to an earlier scheme of EEO enforcement. They ask for modifications of the FCC’s EEO rules to include the following:

  • The return of FCC Form 395, which requires each station annually provide to the FCC a profile of its workforce based on its racial and gender composition. The flings of Form 395 has been suspended for over 7 years, as a reaction to the court cases declaring the use of racial and gender profiling of broadcast workforces as part of the FCC’s EEO enforcement regime to be unconstitutional. Since then, the FCC has been seeking a way to bring back the form for statistical profiling of the industry without risking having the information used for enforcement purposes, but has not, as yet, adopted procedures to do so.
  • More EEO audits. The FCC currently audits 5% of all stations annually for EEO compliance. MMTC suggests that 20% of all stations be audited annually, with some audits being done on site at the stations, rather than simply being a paperwork exercise filed at the FCC.
  • An increase in the size of the FCC’s EEO staff so that audits will be more thorough, and completed more quickly. MMTC pointed out that, in several cases, no fines were issued to companies with insufficient EEO efforts as, by the time their EEO efforts were reviewed, a renewal application had been granted, cutting off the FCC’s ability to fine the station for actions taken in a prior renewal period.
  • Moving EEO from the Media Bureau to the Enforcement Bureau. The Enforcement Bureau seemingly has been more ready to take aggressive action against stations for FCC rule violations generally than the Media Bureau.
  • Exempt stations with diverse workforces from EEO penalties
  • Work with the EEOC to investigate more instances where discrimination complaints are filed and take such complaints into account in an FCC review.
  • An investigation into whether word-of-mouth hiring remains too common in the broadcast industry
  • Start an FCC investigatory hearing into why minority representation in broadcast journalism is decreasing

Whether any or all of these steps is taken remains to be seen. But what we are looking at in MMTC’s request is a return to an emphasis on minority and female hiring, not on simply hiring from all groups within the community, not exclusively from the “old boys” network as currently required by the rules. Watch this space for more developments on the MMTC petition. And, for more information on the FCC’s current EEO requirements, see our advisory on the EEO rules here, and our regular reminders on the FCC’s mandatory public inspection file report, the most recent of which is available here. 
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Posted on July 5, 2009 by David Oxenford

On-line Recruitment Not Sufficient EEO Outreach for the FCC

In three cases released last week, the FCC made clear that its EEO rules, requiring wide dissemination of information about job opportunities at broadcast stations (and cable systems), are not satisfied by solely posting of information about openings on websites.  Instead, the Commission required that additional outreach efforts be undertaken in order to assure that the notice of the job opening reaches all groups within a  community.  The decisions pointed to the FCC's 2003 Report and Order adopting the current rules which stated that the FCC did not feel that the Internet was sufficiently ubiquitous that they could feel comfortable with on-line postings being sufficient to reach all groups within a community.  In the recent decisions, the FCC staff said that they were not ready to change the determination of the 2003 Commission.

What does this mean on a practical level?  The decisions hold that simply using internal station sources plus on-line postings (in one case website postings plus some combination of walk-ins, industry referrals, and internal postings; in another case  the use of the station's website, plus employee referrals) were insufficient to assure wide dissemination.  To avoid getting caught in this trap, broadcasters must use some other traditional outreach services (e.g. employment agencies, community groups, educational institutions, and the local newspapers) to assure that they meet the Commission's wide dissemination requirements. 

On a more theoretical level, one wonders whether the Commission ought to reexamine this policy.  In the 2003 Order, the FCC assumed that the principal daily newspaper in a community would reach all groups in that community.  Query whether that makes sense 6 years later, especially when some communities (like Detroit) no longer even have a daily paper.  In the 6 years since that decision, the FCC has never addressed the Petitions for Reconsideration that were filed requesting a reexamination of that determination.  In these days where Craigslist and Monster.com have replaced the traditional newspaper classified ads as the place to go for job information in many cities, the FCC should look more closely at its policies.

The decisions also demonstrate that even large broadcasters are not immune from problems in meeting their EEO recruiting obligations.  The fines were all imposed against clusters of local stations owned by large broadcast group owners.  In one of the cases, the local cluster had not put its annual EEO public inspection file report on its website, as required by the rules (a failing which the FCC could, and did, check from its offices in Washington).  In another, the group did not keep adequate records of the wide dissemination that it engaged in, and did not notify community groups that had asked to be notified about station job openings (a notification required by the rules). 

Many of these issues were discovered by EEO audits, which the FCC continues to conduct (the last one occurring just months ago).  Thus, stations need to be alert for these issues, and avoid the potential fines that they can bring - at least until the FCC revisits its policies on these issues.  
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Posted on March 24, 2009 by David Oxenford

FCC Launches New Round of EEO Audits - Highlights the Requirment for Posting Annual Report on Station's Website

The FCC today released another Public Notice announcing the random audit of the EEO performance of a number of broadcast stations - listing both radio and television stations that have to respond, with stations spread throughout the country.  The FCC has promised to annually audit 5% of all broadcast licensees to assess their compliance with the FCC's EEO rules.  These rules require the wide dissemination of information about job openings at their stations and "supplemental efforts" to educate their communities about employment opportunities at broadcast stations, even in the absence of employment openings.  The FCC's audit letter requires the submission of two years worth of the Annual Public File reports that stations prepare each year on the anniversary date of the filing of their license renewal applications.  These reports are placed in the station's public file and posted on their websites (if they have websites).  The FCC's public notice about this audit emphasizes the requirement for posting the Annual Report on a station's website, perhaps confirming rumors that we have heard about the FCC's staffers browsing station websites to look for these reports.

Stations are given until May 4 to complete the audit responses and submit them to the Commission.  Note that information needs to be supplied not just for the station named on the list, but also for all other stations in the same "station employment unit," i.e. a group of stations under common control, that serve the same general geographic area, and which have at least one common employee.  As recent audits have led to significant FCC fines (see our story here about fines issues just before the holidays), broadcasters who are listed on this audit list should take care in preparing their responses.  The audit notice should also remind other licensees who are lucky enough to avoid having been selected for inclusion on this audit list to review their EEO programs for FCC compliance purposes, as they could very well find themselves not so fortunate when the next FCC audit is announced.

For more information about the FCC's EEO requirements, see our comprehensive memo on the EEO requirements, here.  Also, a PowerPoint presentation that I prepared last week in connection with a webinar on the EEO rule for the Maine Association of Broadcasters, outlining the FCC requirements, will be available here shortly. 

For ease of reference, the FCC's Public Notice of this audit is here, the text of the audit letter is here, the list of radio stations selected is here, and the television station list is here. 
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Posted on January 11, 2009 by David Oxenford

FCC Fines Multiple Broadcast Stations for EEO Violations - Fines Up to $20,000 Imposed

Just after Christmas, the FCC gave a number of broadcasters the equivalent of coal in their stocking - fining six different licensees for violations of the FCC's EEO rules.  The fines issued that day ranged between $7,000 and $20,000, and included penalties issued to major broadcasting companies including Fox and Cumulus.  Also included were fines against Urban Radio in New York City and Puerto Rico Public Broadcasting - demonstrating that the FCC's EEO rules, adopted in late 2002 after previous rules were declared unconstitutional essentially on "reverse discrimination" grounds (as they encouraged broadcasters to make hiring decisions not based on qualifications but instead based on race or gender), are truly race and gender blind.  It would be logical to assume that Urban Radio and Puerto Rico Public Broadcasting both had significant numbers of minority-group members on their staffs but, as they could not demonstrate that they had complied with the new rules requirements to reach out to all groups in their communities (as opposed to just racial or gender focused groups), they were assessed fines.  Reporting conditions, requiring that the broadcasters regularly file reports with the FCC so that their EEO efforts can be monitored, were also imposed.  All of the decisions can be found on the FCC's Daily Digest for that day, here.

The basis of all of these fines was the failure of the licensees to be able to demonstrate that they had "widely disseminated" information about all of their job openings.  The core of the 2002 EEO regulations was the requirement that licensees broadly disseminate notice about their job openings in such a way so as reach all of the significant groups within the community that the station serves.  The Commission was not looking to specifically force minority hiring, but instead to push for hiring from diverse sources.  The Commission wanted to push broadcasters to use recruitment sources beyond the existing broadcast community - so that hiring was not simply done by word of mouth or from within other professional broadcast circles.   Thus, the rules require that broadcasters use recruitment sources that reach out to various groups within their community and document those efforts. 

The rules require that these outreach efforts be documented.  Specifically, the FCC looks for information about the sources used to recruit for each opening, and to keep track of the recruitment sources of those who are interviewed for each position.  It may well be that the broadcasters who were fined in December had recruited for most of their positions but, because they were not able to document their employment efforts, they were fined.

The rules also require that broadcasters assess their programs from time to time and, if the programs do not bring in prospective employees from diverse sources, to expand or modify their programs.  Thus, where broadcasters do not maintain sufficient information to document their efforts, the FCC adds an additional fine for the licensee's failure to "self-assess" its program.  Essentially, the FCC finds that an applicant who doesn't know what sources it used to recruit for a specific job opening, it can't appropriately determine if its recruitment sources are bringing in applicants from a diverse cross-section of their communities.

These issues were discovered by the FCC either through the requirement that a broadcaster file two years worth of EEO Public Inspection File reports with its license renewal application, or through the FCC audit process - where the FCC randomly audits the EEO performance of approximately 5% of all broadcast licensees each year.  In the last two years, broadcasters also have to submit a Form 397 EEO Mid-Term Report - 4 years after the submission of their license renewal applications - another opportunity for the FCC to review their EEO performance.  The next Mid-Term EEO Mid-Term Reports are due on February 1 for Radio Stations in Kansas, Nebraska and Oklahoma and TV Stations in Arkansas, Louisiana and Mississippi.  More information about the February 1 filing date can be found in the Davis Wright Tremaine Advisory on the Form 397 and the Annual Public File Report.   Our memo on the full requirements for compliance with the FCC's EEO requirements can be found here.  Make sure that your EEO program is in compliance to avoid that lump of coal from the FCC in your stocking. 
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Posted on October 9, 2008 by David Oxenford

FCC Continues EEO Audits - This Time Targets Cable Companies, Not Broadcasters

The FCC has released another Public Notice that it is auditing the EEO performance of a number of the entities that it regulates.  However, this time, the audits are not of broadcasters, but instead of cable companies and other multichannel video programming distributors who are subject to essentially the same EEO rules as broadcasters.  The list of MVPDs that have been hit by the audit can be found appended to the Notice.  Each company that was audited has 30 days to respond to the FCC with details of its compliance with the EEO rules, including information about the wide dissemination of information about each of its job openings and other EEO outreach efforts that it has made.  The FCC's policy is that it will audit the EEO performance of 5% of all of its broadcasters and MVPDs each year - so use this audit notice as a reminder to review your EEO program.  Details of the FCC's requirements for a broadcaster's EEO obligations can be found in Davis Wright Tremaine's advisory, here.

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Posted on September 4, 2008 by David Oxenford

Big EEO Fines on DIRECTV, and The Return of FCC Form 395B

In two recent actions, the FCC has evidenced its concern about the EEO performance of its licensees.  Last week, the Commission's Enforcement Bureau entered into a Consent Decree with DIRECTV, by which DIRECTV paid the FCC $150,000 in lieu of a fine for the company's failure to abide by the FCC's EEO rules by not preparing an Annual EEO Public File Report or submitting a Form 396-C for several years.  The FCC also released a Public Notice announcing changes in the racial categories to be used in FCC Form 395 - the Form breaking down the employees of a broadcaster or cable company by race and gender.  That form has not been filed for years, as its use was prohibited when the FCC EEO rules were declared unconstitutional.  In adopting new EEO rules in 2003, the FCC promised to return the form to use, but has been wrestling with the issue of whether or not the form should be publicly available or whether it should simply used internally by the FCC to collect data about industry employment trends. The adoption of new definitions for the racial categories specified on the form may signal the return of this form.  Together, these actions demonstrate that the FCC has not lessened its concern about EEO in any fashion.

The DIRECTV fine was the result of the company's failure to prepare Annual EEO Public File Reports or to submit 2003 and 2004 Form 396-C reports - reports that are more detailed versions of the Form 396 filed by broadcasters with their license renewals and the Form 397 Mid-Term Employment report.  The Form 396-C requires that multichannel video providers detail their hiring in the previous year and the outreach efforts made to fill job vacancies, the supplemental efforts that the employment unit has made to educate its community about job openings, and other details on the company's employment practices.  After review of the company's efforts, the Commission not only faulted the company for its paperwork failures, but also determined that the company had not engaged in sufficient outreach for all of its employment openings - relying solely on the Internet and on word-of-mouth recruiting for many job openings, which the Commission found to be insufficient.  Broadcasters need to make sure that they do not forget to file their required EEO forms, prepare their annual EEO Annual Public File Report, and engage in wide dissemination of information about all job openings.  Details of the FCC's EEO rules, policies and requirements applicable to broadcasters can be found in Davis Wright Tremaine's EEO Advisory.

The Form 395B is a report that was filed annually by all broadcasters with 5 or more full-time employees, breaking down all station employees into 8 categories of employment positions, and then categorizing each employee by their race and gender.  The form as last used by broadcasters can be viewed here.  The form has not been used since a prior version of the FCC's EEO rules were ruled unconstitutional as they were found to implicitly force broadcasters to make hiring decisions on racial and gender basis.  As the Form 395B reported this information and was on occasion used to support petitions to deny arguing that broadcasters had not done enough to reach out to minorities and women as their employment profile did not reflect sufficient representatives of those groups.  In 2003, when it adopted its current EEO rules and policies, the FCC stated that it had to revive the Form 395 as Congress required the collection of employment data on broadcasters in legislation adopted several years before.  However, the Commission did not immediately reimpose the requirement to file the form until it could resolve arguments as to whether that information could be collected without making public the employment profile of individual broadcasters.  Broadcasters have feared that station-specific information could be used to pressure broadcasters to make hiring decisions based on the racial or gender characteristics of job applicants, while public interest groups have contended that broadcasters should have nothing to fear by having that information public as the FCC has promised not to use it for enforcement purposes.

In its recent action announcing that it had adopted changes to the wording of the racial and ethnic categories used on the Form, the FCC refused to consider comments that were filed recently on the issue of whether the form would be public or private - presumably delaying consideration of that question for a subsequent order.  So watch for that order and the reimposition of the requirement for the filing of Form 395B in the near future.
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Posted on March 27, 2008 by David Oxenford

What a Difference A Renewal Makes - FCC Admonishes Two Broadcasters for EEO Violations, Fines Would Have Followed if Renewals Had Not Recently Been Granted

In two decisions released this week by the FCC, here and here, two large broadcast group owners were admonished for failures to comply with the FCC’s EEO rules. In both cases, failures to widely disseminate information about job openings in one market were discovered by the FCC in the course of random EEO audits that selected these stations for review. In both cases, the Commission determined that the violations were serious, and imposed reporting conditions (essentially subjecting the stations to an FCC audit of their EEO annual public file reports every year for the next 3 years). And in each case, the FCC would have fined the stations for their violations, but the Commission moved too slow, as in both cases, license renewals were granted between the time of the violations and the EEO audit.  Under provisions of the Communications Act, the Commission cannot fine a station for action that occurred during a prior renewal term - so the grant of the renewals cut off the possibility of a fine in these cases.

These actions highlight the importance of complying with the Commission’s EEO rules, which we have summarized in our EEO Guide, here. In particular, in both cases, the station groups had not widely disseminated information about job openings, as required by the rules. Wide dissemination requires the use of recruitment sources designed to reach all groups within a community to allow their members to learn about the job openings at the station. The Commission's aim is to bring into the broadcast workforce employees representing diverse groups within a community rather than hiring all their employees from traditional broadcast sources.  In these cases, the stations had used only corporate websites, on-air announcements, and word of mouth recruiting. No outside sources, or sources reasonably likely to reach the entire community, were used by the broadcasters, hence the admonition and the reporting conditions. 

So, is a broadcaster never justified in relying on its own airwaves as its sole recruitment tool? In most cases, as not everyone in a community is likely to listen to one owner’s broadcast stations, it cannot reasonably be assumed that the use of the airwaves would reach the entire community.  While the FCC, in the Order adopting the EEO rules, did say that the use of a major newspaper read throughout the community might be sufficient as a source to reach all groups within the community, most broadcasters face competition, rarely being in a situation where they have the overall market reach of the monopoly daily newspaper (even though most broadcasters might argue that it is far more likely that ads on their stations will be heard and remembered than it is that a classified ad somewhere in a newspaper will be read by a potential employment candidate – especially one who may not be actively looking for work, but who might be intrigued by the possibility of a broadcast career and consider pursuing an open broadcast position). Nevertheless, under the current EEO regulations, broadcasters must design their EEO programs in such a way so as to be theoretically targeting all groups within a community.

In addition, it is important to note that one of these decisions involved Entravision, a broadcaster specializing in Spanish-language programming. It is probably reasonable to assume that the broadcaster had an ethnically diverse workplace, attracting Hispanic-American employees. However, the new EEO rules are designed not to measure the race or ethnicity of the broadcast station’s workplace, but instead to measure its efforts to reach out to the entire community and all groups within that community (not just racial and ethnic minorities) to bring new people from these diverse groups into the broadcast workforce. Thus, stations that may have racially or ethnically diverse workforces should not consider themselves exempt from the requirements of the rules. 

As the Commission has committed to randomly audit 5% of all broadcast stations annually, and to also audit cable television systems which are subject to similar EEO rules, these cases are significant in demonstrating that the Commission’s EEO rules must be strictly observed, or serious consequences may ensue. So assess your EEO program now to assure that it is in compliance with the Commission’s rules. 
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