The FCC Is Watching You . . . or At Least Your Website

Posted on September 2, 2011 by Anne Goodwin Crump

Media Bureau staff continues to check station websites for compliance

A couple-three years ago, we warned readers that the staff of the FCC’s Media Bureau appeared to be browsing the websites of broadcast stations, checking for compliance with the EEO rules. Actually the FCC staffers were then apparently checking for compliance with an imaginary EEO requirement that didn’t – and still doesn’t – exist, but the important take-home message was the same regardless: FCC staffers were inspecting broadcasters’ websites.

It appears that that practice continues.

Recently, an FCC staff member emailed us, questioning whether one of our clients had posted its annual EEO report on its website. (As noted below, the rules do require such posting.) The staffer reported that she had been unable to find the report on the site. Happily, we were able to confirm (and demonstrate) that the report had in fact been posted – albeit not necessarily in the most obvious place on the station’s site – and the staffer apparently went away satisfied.

But that encounter prompts us to remind broadcasters that their websites are wide-open for inspection by anybody, including FCC staffers.  And nowadays those staffers are apparently motivated to engage in such inspection in connection with the license renewal process, which is swinging into high gear. (Two batches of renewals have been filed already, with more to come at two-month intervals for the next few years.)

The Commission’s rules currently specify only one type of “public file” document that must be included on a station’s website (assuming, of course, that the station has elected to have a website): the licensee’s most recent annual EEO report, the specs for which may be found in Section 73.2080(c)(6) of the rules. (Obscure regulatory factoid: The public file rule technically still requires that DTV transition education reports – Form 388 – be posted on websites. However, since the retention period for those reports is only one year, and since all but a dozen or so TV stations completed their move to digital more than a year ago and thus no longer have to file Form 388, the continuing impact of that particular requirement is minimal at this point.)

Of course, stations with fewer than five full-time employees are exempt from the annual EEO report requirement. But if you are not exempt, and if you do have a website, it would be a good idea to be sure that your most recent EEO report is posted there. While the rule does not specify how prominently the report is to be posted, it would probably be a good idea to make it pretty darned easy to get to the report from the station’s home page. That should assist FCC staffers in locating the report at your site – thus enabling them to move on to somebody else’s site that much quicker.

Our recent interaction with the staff did not indicate that the FCC is looking to dole out fines to stations that don’t happen to have posted their reports as required. But you never know.

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Parsing Form 397

Posted on August 31, 2010 by Anne Goodwin Crump

Which TV licensees have to file?

Recently, the Minority Media & Telecom Council asked the FCC to suspend enforcement of the EEO rules for three months. (You can read MMTC’s request here; alternatively, you can read our monthly Memo to Clients summary of the request here.) At this point, it’s anybody’s guess as to whether the FCC will grant MMTC’s request – although, frankly, if even MMTC is asking that EEO enforcement be suspended, the Commission really should be wondering what’s wrong with this picture.

But regardless of what the Commission eventually does, it might want to take this opportunity to clean up at least one aspect of its EEO “Broadcast Mid-Term Report” (FCC Form 397) that seems oddly and unnecessarily confusing, if not flat-out inconsistent.

Form 397 is a cute little three-page form. The first page calls on the reporting licensee to provide its name and contact information and identify the stations covered by the report. No real surprises there.

But on page two, Section I consists of the following single yes/no question:

Does your station employment unit employ fewer than five full-time employees, if television, or fewer than eleven full-time employees, if radio?

Not an overly complicated question. Then the form reads:

If yes, you do not have to file this form with the FCC. However, you have the option to complete the certification below, return the form to the FCC, and place a copy in your station(s) public file.

This last instruction raises an obvious question – i.e., who in his right mind would “opt” to file a form that the FCC specifically says does not have to be filed? – but that’s not the problem. Rather, the problem arises from the fact that the “filing instructions” located immediately above Section I include the following:

If a television station employment unit employs fewer than five full-time employees, only the first two pages of this report need be filed.

So does that mean that TV stations with fewer than five have to file a report (even if the report is limited to only two pages), or does it not have to file anything at all (unless, of course, it opts to)?

Oh, and did we mention that the underlying rule (47 C.F.R. §73.2080(f)(2)) provides that

The Commission will conduct a mid-term review of the employment practices of each broadcast television station and each radio station that is part of an employment unit of more than ten full-time employees four years following the station's most recent license expiration date as specified in §73.1020.

Let’s get this straight. If you’re a TV licensee with fewer than five full-timers, according to Form 397 either “you do not have to file this form” or “only the first two pages of this report need be filed”. Huh? And Section 73.2080(f)(2) isn’t much help in sorting this out, since that section could be read to say that mid-term reports are expected from TV stations with more than ten FT employees – even though the 2002 Report and Order adopting the rules makes reasonably clear (check out Paragraph 153) that the Commission intended to limit mid-term EEO reviews to TV stations with five or more FT employees.

There is at least one possible way (see “Suggested Solution”, below) to twist this regulatory Rubik’s cube to make all the seemingly incongruous parts look consistent, but really, would it be that hard for the FCC to take the time to articulate its requirements clearly and consistently in the first place? Sure, we know that the number of TV stations with fewer than five full-time employees may be limited, but is that any excuse for at-best-ambiguous-at-worst-hopelessly-inconsistent forms?

[Suggested Solution:

Step 1: Understand that Section 73.2080(f)(2)’s clause reading “that is part of an employment unit of more than ten full-time employees” refers only to the term “each radio station”, and not to “each broadcast television station”.  That reading is not absolutely dictated by the grammatical structure of the particular sentence in question, but it’s also not clearly foreclosed by it.

Step 2: Since “television station” in Section 73.2080(f)(2) is not modified by the “more than ten” clause (see Step 1), refer back to the prefatory language of Section 73.2080(f). That language limits the reach of that section (including its subsections, such as 73.2080(f)(2)) to employment units with “five or more persons in full-time positions, except where noted”. Thus, the term “television station” as it appears in 73.2080(f)(2) can be read to be limited to TV stations with five or more full-timers. That assumes, of course, that the “except where noted” phrase in the preface is intended to refer to – and except out – the “more than ten” clause in (f)(2). Again, that assumption is not absolutely dictated by the rules’s language, but it’s also not clearly foreclosed by it. 

Step 3:   Assume that the FCC really means it when it says (in Section I of Form 397) that TV licensees with fewer than five FT employees “do not have to file this form with the FCC”.

Step 4: Assume that, when the form’s instructions say that “only the first two pages of this report need be filed” by TV licensees with fewer than five FT employees, it really means that those pages need be filed only if the licensee chooses to go ahead and file a report even though it doesn’t have to.

End result: TV employment units with fewer than five full-time employees need not file any mid-term EEO reports.]
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FCC Whacks Six Licensees for EEO-Related Violations

Posted on January 5, 2009 by Anne Goodwin Crump

Four-to-five figure fines for recordkeeping, self-assessment short-falls

With the release of six notices of apparent liability (NAL) at the very tail end of 2008, the FCC has given us a glimpse of what EEO enforcement is likely to look like for the foreseeable future. And the outlook is what you might expect: continued emphasis on detailed record-keeping despite the absence of any indication that any unlawful employment discrimination has occurred.

The six decisions appear to be directed to the broadest possible range of stations, with stations in the east and west, large and small licensees, minority and non-minority ownership. One common factor that all share is the age of the alleged violations: all of the alleged recordkeeping shortfalls took place at least two years ago, with most of the data going back to 2003 or 2004.   The penalty in all cases was a combination of a fine (with amounts varying from $7,000 to $20,000) and reporting conditions.

Each of the NALs arose from the Commission’s random audit program. Each year the FCC requires that randomly-selected stations submit detailed information concerning their EEO efforts. The FCC’s review process is apparently rigorous – how else to explain the multi-year timeframe from initial submission of the EEO information to the 2008 issuance of the NALs?

There are a number of lessons to be taken from the NALs.

The first is that, if your station’s employment unit is not going through some sort of self-assessment regarding EEO matters on a periodic basis, it should start doing so immediately. The common thread among all of the decisions was that the missing paperwork made it impossible for the station or stations to engage in the required self-assessment. The FCC’s rules do, in fact, require that employment units periodically review their EEO practices, and that requirement was the focus in all of the decisions. Accordingly, stations should actually take the time to sit down and look at where they are recruiting, how effective that recruitment is, and what could be done differently to improve results. It is possible to remove non-productive recruitment sources from the list of sources contacted and to replace those with other, perhaps more responsive, sources. The important thing is to look at where the employment unit is and to see what tweaks could be made to the recruiting system to make it better.

Another word to the wise is that, if your review shows a lack of information concerning exactly where applicants came from or how they learned about the opening, change that pattern at once. Stations are required to list the total number of interviewees and the total number of interviewees referred by particular recruiting sources each year in their public file reports. In addition, should you find yourself the subject of one of the FCC’s periodic audits, it will be necessary to supply the recruitment source for each interviewee. Therefore, make sure that you keep this information as you go. The FCC acknowledges that you may not know a source for everyone who applies for a position. Nonetheless, it seems to think that if you are serious enough to interview a person, and if you actually talk to that person, you should be able to get a referral source from him or her. Accordingly, it would be prudent to ask, as an essential question to be posed to all interviewees, how they happened to hear of the job opening.

Additionally, if your stations are recruiting through only internet sources and in-house referrals, broaden your sources before you hire anyone else. The FCC has already stated that internet sources alone are not sufficient. Likewise, if recruitment efforts include only on-air announcements, you need to look elsewhere in addition. The Commission’s rationale on the latter is that only those persons who are tuned in to the station at the time that the announcement is made will know about the opening. The upshot is to not rely on only one source for recruitment, but rather to expand outreach efforts broadly. While the Commission has indicated that reliance on a single source may be enough if that source is broad enough, a better approach is to rely upon different types of recruiting.

And the final tip – which returns us to the overall theme of paperwork – is to document everything that you do in the way of general community outreach. FCC rules require that each station employment unit, depending on the size of both the station(s) involved and the size of the market, complete two to four general EEO outreach efforts in a two-year period. The stations also must keep documentary evidence of such participation, which is where some of the stations targeted in the NALs fell down on the job. Basically, even if you made the required efforts, if you can’t document them, they didn’t happen and you can’t take credit for them.

Perhaps the most intriguing common aspect of the decisions, however, is what the FCC did not allege. In none of these cases was there any allegation of actual discrimination. Rather, the licensees’ sins fell exclusively into the categories of recordkeeping and failure of adequate self-assessment. The implication seems to be that if the licensees had just kept better records of where their interviewees learned of the opening and the like, then the licensee’s employment profile (and, ultimately, the employment profile of the overall broadcasting industry) would somehow ineluctably mirror the ideal of diversity. 

There are, it seems to us, more than a few problems with the FCC’s approach here. The primary target of EEO rules should, it would seem, be actual unlawful discrimination. The failure to keep exhaustive records of interview minutiae – for example, how each interviewee claims to have learned of a job opening – does not relate to such discrimination at all. But historically, the FCC has seemed to view the goal of its EEO program to extend well beyond the enforcement of anti-discrimination laws. In defending an earlier version of that program in the U.S. Court of Appeals for the D.C. Circuit in 2001, the Commission argued that its goal was simply to assure that broadcasters engaged in “broad outreach” in their recruitment. But the Court concluded that the FCC really had a different agenda:

[If] the Commission's only goal [were to assure that broadcasters engage in “broad outreach”], then it would scrutinize the licensee’s outreach efforts, not the job applications those efforts generate.  Measuring outputs to determine whether readily measurable inputs were used is more than self-evidently illogical; it is evidence that the agency with life and death power over the licensee is interested in results, not process, and is determined to get them.

Those observations led the Court to conclude that that earlier version was unconstitutional. The current version, adopted in response to the Court’s ruling, was intended to avoid those constitutional pitfalls. But to the extent that the Commission continues to harp on results, the closer it treads to the same pitfalls.

Interestingly, Commissioners Copps and Adelstein issued a separate statement applauding the NALs and asserting that “employment in broadcasting does not reflect America” and that it is a “legal obligation” to have a “communications industry that reflects our nation’s diversity”. But that notion – that the FCC is both empowered and, indeed, obligated, to take steps to achieve some idealized industry employment profile – seems flatly inconsistent with the Court’s 2001 decision. It will be particularly interesting to see whether the Commission as it develops in the Obama administration will pursue that Copps/Adelstein line of thinking. If it does, the Commission may find itself back in court.

For the time being, though, we can expect the current EEO program, complete with annual random audits, to continue full speed ahead.
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Update: The FCC Is Not Watching You Anymore (or so they have told us)

Posted on October 7, 2008 by Harry Cole

Last month, in a blog posting about apparent FCC monitoring of station websites (to see if stations’ Form 397s – the mid-term EEO report – are being posted on those websites), we indicated that Form 397 is required to be posted on the website of each station required to submit a Form 397. That was based on what a Commission staffer informally told one of our colleagues. That staffer also advised that the staffer’s job activities include on-line checking on whether Form 397s have been posted on stations’ websites.

 We have since done some double- and triple-checking of our own, and as it turns out, the rules do not require Form 397 to be placed on a station’s website. No such requirement of website posting is imposed, implicitly or explicitly, by the public file rules (Section 73.3526 and 73.3527) or by the EEO rule (Section 73.2080). In fact, those rules don’t even require, explicitly or implicitly, that Form 397 be placed in the station’s hard-copy local public inspection file. While the instructions to Form 397 do explicitly state that a copy of the Form 397 “must be kept in the station’s public file”, those instructions say nothing about posting the Form 397 on the station’s website.

Still, as noted above and in our earlier posting, we were advised by the Commission’s staff that they understand that website posting of Form 397 is de rigueur and, moreover, that they are doing their own on-line spot-checks for compliance.

What to do?

We have contacted a senior FCC official whose responsibilities include EEO enforcement. He has confirmed our research: Form 397 is NOT required to be placed on any station’s website. He also assured us that, if there is any misunderstanding on that point among FCC staff, he will correct it right away.

Note that, even if monitoring for the presence of Form 397 stops (as we expect it will), the fact remains that FCC staffers can still visit station websites -- anonymously and long-distance -- to check out, f'rinstance, the on-line availability of annual EEO public file reports (which are required to be posted on station websites).  In other words, long-distance snooping may still go on -- it just won't involve the supposed violation of imaginary rules.  Licensees with websites should continue to maintain them in accordance with the rules that do exist, particularly since prying eyes may be watching . . .

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Don't Look Now, But You're Being Watched . . .

Posted on September 16, 2008 by Harry Cole

"We're from the government, we're here to help . . . "By now all radio and TV licensees with "station employment units" (SEUs) having five or more full-time employees should be in the habit of preparing the annual EEO report that must be placed in the station's local public inspection file each year on the anniversary of the due date for their renewal application. Those annual reports are also required to be posted on the station's website, IF the station has a website.  Ditto for FCC Form 397, the mid-term EEO report required of TV SEUs with five or more full-timers and radio SEUs with 11 or more full-timers at the mid-point of their license terms.  

One of the miracles of the Internet, of course, is the fact that pretty much anything that's posted there can be viewed by pretty much anybody pretty much anywhere. So it should come as no surprise that we have heard that FCC staffers – sitting in the comfort of their government-issued chairs in beautiful Washington, D.C. (our nation's capital) – have been checking station websites across the country to see whether those websites include FCC Form 397 like they're supposed to. 

So far we have not heard of any fines being issued for any apparent violations detected through this remote investigation technique, but it's probably just a matter of time. You have been warned.

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