Where collective bargaining agreements have formalized segregated job structures and provided the vehicle for discrimination, the settlement of issues arising from these conditions invariably leads to litigation. Truck ing and motor freight provides a classic example because of its use of departmental seniority; another example in this study is shown in the case of the manufacturer of cast iron products. Issues of segregated facilities are usually settled without major objection. They were raised frequently during the Commission's first year of operation and contributed substantially to the relatively large number of cases successfully conciliated in that period, but they have declined through time as employers quickly adjusted facilities to conform with Title VII. Between these extremes are a number of issues whose cost varies on a case-by-case basis. Discharge and promotion charges typically involve nonpecuniary costs, and settlement in one instance may be accomplished with little difficulty; in another it may not, as in the rubber industry case reported earlier. Should conflicting personalities be involved, the cost of admitting error may be high. Moreover, the error simply may be that the respondent feels his actions leading to the charge were not discriminatory but were the correct policy on his part. Respondent Size As noted previously, the outcome of conciliation is generally less satisfactory among firms with less than 100 employees. In small firms lines of progression are frequently undefined and no formal structure exists for upgrading. Hiring and selection is less formal and more likely to be subject to discriminatory practices. Moreover, small firms function, in general, in highly competitive product markets and are less willing to accept costly conciliation settlements. For example, apprenticeship and on-the-job training costs may be high for them, and if they are able to obtain "experienced" personnel from the labor market for a given occupation, they resist provision of 5/ such training within their own plants. Management of small firms more often than not is spread among several activities. Hence, an office or plant manager may also serve as a personnel manager, as was true in several cases in this study--the small retail outlet, the manufacturer of bagging materials, the manufacturer of drilling materials, the manufacturer of women's apparel. Larger firms are able to allocate specialized resources to compliance activities following the outcome of conciliation; compliance in general appears to respond favorably to this specialization. There is no strong evidence to suggest that conciliation agreements which affect one plant in a multi-plant firm spill over directly to other plants. Nevertheless, there may be an indirect effect. All but one of the respondents interviewed in this study were part of multi-plant firms, and only 2 of the 13 indicated there had been direct application of a successful conciliation agreement to another plant. However, home office personnel participated in respondent interviews and in conciliation negotiations in 6 of 13 cases, so it is reasonable to believe that conciliation may have helped to modify corporate personnel policies. The OFCC and Enforcement Power Conciliation has been viewed as a confrontation of power focusing on parties' bargaining strategy, their willingness to compromise, and their power to inflict loss on one another as determinants of conciliation's other federal agencies; and the publicity accorded actions taken to the With the enactment of the Equal Employment Opportunity Act (EEOA) of 1972, the EEOC was empowered to bring direct civil action against respondents when voluntary compliance efforts were unsuccessful. This represented a substantial shift in the balance between the Commission, charging parties, and respondents. Formerly, under Section 706 only charging parties could institute such action, and less than 10 percent of unsuccessfully conciliated cases were taken to court, even though Commission investigators had found "reasonable cause. ,,6/ Consequently, between 1965 and 1971 the expected cost of settlement to respondents, when adjusted for the expected risk of conflict, was small. This should change. It may be anticipated that where the door to conflict, represented by civil action in federal court, is opened by the EEOA, respondents will carefully review the possibilities in voluntary compliance before electing legal confrontation. Although the Commission had no "power of enforcement" through 1971, another federal agency did. The U.S. Office of Federal Contract Compliance, created to administer Executive Order 11246, could debar a federal contractor from doing further business with the government or its agents. Executive Order 11246 prohibited discriminatory employment practices and required positive action on the part of government contractors to insure equal opportunity without regard to race, color, religion, sex, or national origin. In February, 1970, the OFCC issued Order No. 4 which strengthened the affirmative action provisions of the Executive Order. Order 4 imposed three obligations on government contractors as conditions for an acceptable affirmative action plan: (1) they must examine minority utilization rates in each job category; (2) they must establish goals and timetables to correct deficiencies; and (3) they must collect adequate data so that progress toward affirmative action goals may be measured. contractors. Seven of the 14 respondents interviewed in this study were also federal Two, one in aerospace and one in ordnance, were almost completely dependent on federal contracts. The others were not, as their sales to government ranged from approximately 10 percent of sales to 1 percent. It is therefore of some interest to examine the influence of the OFCC and its enforcement power on the compliance procedure. OFCC.1/ The threat of debarment for most contractors was an empty one. Through 1971, only one company had ever been debarred by the OFCC. Nevertheless, the provision of equal employment opportunity was sometimes used by the government as a form of nonprice competition.8/ For example, the respondents in aerospace and in ordnance in this study indicated that the OFCC exercised considerable influence in determining employment practices largely because of the companies' dependence on federal contracts. Conciliation agreements in these cases formalized policies established earlier through affirmative action programs of the OFCC. Where deficiencies in these programs were observed in conciliation, substantial effort was made to modify them. Among the other federal contractors studied here, particularly in trucking and motor freight, no similar results were found. For a number of these contractors, the loss of government business would have offered minor inconvenience, but no real loss. In fact, the government might have been more inconvenienced than the contractor through debarment in some cases. Obviously, where this was true, the enforcement power of the OFCC was of little consequence to Commission compliance activities. Some writers have cited the generally poor minority employment record of firms who are federal contractors, vis-à-vis those that are not, in criticism of the OFCC. For the most part, however, these studies fail to adequately control for capital intensity, skill requirements, community location, growth characteristics, and other variables which are associated with minority employment. More importantly, they make the assumption that the power and influence of the OFCC is evenly distributed among contractors: it is not. Organizational Structure and Respondent Preferences ment. The method by which management communicates policy to those responsible for its enactment and the degree of their accountability for carrying it out are important in determining the effect of conciliation on minority employConsequently, the length and breadth of the respondent's line-staff structure would appear to be significant. However, evidence gathered from respondents suggests that the influence of this variable is small. The impact of conciliation reduces to how strongly the respondent chooses to pursue the goal of fair employment. Where a respondent is guided by this objective, an extensive organizational structure has not been an impediment |