A compromise version of a hotly debated executive order on affirmative action would deprive the Labor Department of its power to penalize government contractors for failing to meet numerical goals in hiring minorities and women, according to a copy obtained yesterday.
The compromise language, which is all but final, appears to be a victory for Attorney General Edwin Meese III and Assistant Attorney General William Bradford Reynolds in their dispute with Labor Secretary William E. Brock over the final shape of the presidential order.
The Justice Department officials have insisted that the new order abolish the current requirement that government contractors, who employ 23 million people, meet numerical goals and timetables for hiring minorities and women. Their original draft of the new order, which was leaked to the press in August, caused an uproar among civil rights groups and members of Congress and drew sharp objections from Brock.
Brock has still not given final approval to the new order, which must be signed by President Reagan, but officials from both departments say the battle is virtually over.
The new order contains language to satisfy some of Brock's concerns, but still provides that "no government contractor shall be determined to have violated this order due to a failure to adopt or attain any statistical measures."
The proposal, which would replace a 1965 executive order, contains a gesture toward much of the business community, which has argued along with Brock that numerical goals are a valuable tool in minority hiring efforts.
"The voluntary use of numerical goals and timetables is not prohibited under this order, so long as they are not used and do not operate to discriminate or grant a preference to any person on the account of race, color, sex, religion or national origin," it says. The order also says that a contractor's minority hiring record "may serve as grounds for the Secretary of Labor to initiate an inquiry" into the firm's employment practices.
But the order would virtually eliminate the Labor Department's only real enforcement weapon, the power to debar companies from federal contracts. This power, in force since the Nixon administration, has rarely been used, but its presence has been a lever for the department to secure compliance by recalcitrant companies.
While in theory the Labor Department could continue to debar companies, most debarments result from failure to adopt or live up to written numerical hiring goals, which would no longer be a violation.
A Justice Department spokesman declined comment. But a senior administration official said that "we are close to agreement on the language."
A Labor Department official said discussions on the issue were "virtually completed." But he cautioned that Brock still has concerns about the latest draft and plans to meet soon with Meese to iron out remaining differences.
But another Labor Department official said that Brock gave in after realizing that he was isolated in contending that hiring goals and timetables should be maintained. "But he never will say officially that he disagrees with this," the official said.
Ralph G. Neas, director of the Leadership Conference on Civil Rights, said the latest draft has "very deceptive phrasing . . . . It would gut the existing executive order on affirmative action. This has different words than the first proposal, but it's the same result."
Brock has indicated that he will vigorously scrutinize minority hiring efforts by government contractors, even without the use of numerical goals.
But Neas said any such investigations would be meaningless without numerical targets.
"If no government contractor has to keep records of anything, there's no way to measure the progress," Neas said. "What are they going to inquire into if no one is required to meet targets?"
Given the Justice Department's record of going to court to oppose numerical hiring goals as illegal "quotas," Neas added, "any business person would be acting at his or her own risk" in adopting a voluntary minority hiring plan.
The new order is certain to spark opposition among congressional Democrats, who are considering efforts to tie up nominations and budget bills, and may attempt to draft legislation to mandate the minority hiring goals that the Reagan order would scrap. More than 125 members of Congress signed a letter protesting the original draft order.