Category Archives: Affirmative Action Plan (AAP)

OFCCP Continues to Overhaul Its Investigatory Platform with the Release of the New Federal Contractor Compliance Manual

Late last week, OFCCP released the much anticipated update to the Federal Contractor Compliance Manual (“FCCM”).  The FCCM provides the procedural framework compliance officers use when auditing federal contractors and subcontractors.  The last version of the FCCM was published in the late 1980s, and OFCCP has been hinting over the last couple of years that it would be releasing a new FCCM.

The new 500-plus page FCCM includes the same basic structure as the previous version, but adds a new section for reviews of functional affirmative action plans.  The FCCM has also been updated to reflect OFCCP’s current policies and procedures regarding investigating contractor’s practices for compliance and the remedies it will pursue if violations are uncovered.  For example, the new FCCM contains new procedures for compliance officers to use when conducting adverse impact analyses, reviews of compensation, and calculating back pay awards for discrimination.

The new FCCM covers the following topics:

  • Desk audits of contractors’ compliance with OFCCP’s laws;
  • Onsite reviews of contractors’ establishments;
  • Compliance reviews of construction contractors;
  • Procedures for conducting Corporate Management Compliance Evaluations;
  • Compliance reviews of FAAPs;
  • Investigations of individual and class complaints;
  • Designing remedies for employment discrimination violations; and
  • Procedures for resolving violations during compliance evaluations.

The FCCM also contains a glossary of key words and phrases and includes examples of model forms, letters, and worksheets compliance officers can use during compliance evaluations. 

OFCCP was quick to note that the revised FCCM is nonbinding and is “subject to change without public notice.”  OFCCP released the new FCCM internally to its compliance officers earlier this summer, so many of them are prepared to implement the new procedures in the FCCM.  OFCCP also held a public webinar explaining the updated FCCM on August 27, 2013 and will be making the slides and recording from the webinar available on its website.

We anticipate that with the official release of the FCCM, contractors will notice a change in the posture of audits.  For the last several years, OFCCP has been overhauling its entire investigatory platform “piece-by-piece,” including revamping how it investigates contractors’ compensation systems.  The new FCCM is yet another signal that OFCCP will be conducting more intensive and far-reaching reviews of contractors’ practices.

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Filed under Affirmative Action Plan (AAP), Compensation, Department of Labor, Discrimination, OFCCP

OFCCP Moves Closer to Finalizing Game-Changing Regulations for Individuals with Disabilities and Veterans

On July 31, 2013, the Office of Federal Contract Compliance Programs (“OFCCP”) submitted to the Office of Management and Budget (“OMB”) for approval its final regulations for individuals with disabilities under Section 503 of the Rehabilitation Act.  This comes on the heels of OFCCP submitting the final regulations for covered veterans under the Vietnam Era Veterans Readjustment Assistance Act (“VEVRAA”) to OMB on Tuesday.  OMB will have sixty (60) days to approve or reject these final regulations.

As we previously reported, if passed in their final form, these regulations will usher in game-changing requirements for federal contractors and subcontractors subject to OFCCP’s jurisdiction.  In April 2011, OFCCP released its proposed changes to VEVRAA.  Under OFCCP’s proposed changes, contractors would be required to engage in a number of additional recordkeeping and other obligations designed to increase protections for covered veterans.  See our prior post for a complete list of the proposed changes under VEVRAA.

In December 2012, OFCCP also released proposed changes to Section 503 of the Rehabilitation Act.  The proposed rules contemplate requiring contractors to undertake a number of additional affirmative action obligations for individuals with disabilities, including establishing a seven percent goal in each job group at the contractors’ establishments for disabled individuals. The complete details concerning the proposed changes to Section 503 can be found here

Now that the new Department of Labor Secretary Perez has finally been confirmed, OFCCP will move very quickly to put these and other backlogged items on its regulatory agenda into action.   We will continue to monitor these developments and inform you of any further changes.

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Filed under Affirmative Action Plan (AAP), Department of Labor, Disability Discrimination and Accommodation, OFCCP, Veterans

OFCCP Mandates Contractors Use Most Recent Census Data for AAPs created by 2014

On May 15, 2013, the Office of Federal Contract Compliance Programs (“OFCCP”) posted a notice informing federal contractors that they must begin using the 2006-2010 EEO Tabulation (“2010 Census Data”) for affirmative action plans (“AAPs”) created after January 1, 2014.

Federal contractors with fifty or more employees and a covered federal contract or subcontract of $50,000 or more are required to create and maintain AAPs annually.  One key requirement of an AAP is the determination of the availability of qualified minorities and women for the contractor’s job openings.  Contractors use availability numbers to establish benchmarks to determine if they have any underrepresentation of females or minorities in their current workforce.  OFCCP requires contractors to “use the most current and discrete statistical information available” to determine their external availability estimates for their AAPs.

As we previously reported, the Census Bureau began releasing the 2010 Census Data last November. This data is the most current statistical information available for contractors to determine availability. The 2010 Census Data is set of over 100 tables that break down the labor force in the United States by sex, race, and ethnicity that is searchable by various variables, such as geography and occupation.

In its notice, OFCCP indicated that it solicited input from contractors about transitioning to the 2010 Census Data. Although it found that some contractors had already implemented the 2010 Census Data, it realized that, for many contractors, “converting their IT systems and availability calculations to the new data will take time due to changes in the coding and categorization” of the 2010 Census Data.  As a result, the OFCCP is allowing contractors until January 1, 2014 to use the 2010 Census Data in their AAPs, but noted that contractors could use it earlier if they wished to do so.

In light of this notice, contractors should start assessing how they can incorporate the 2010 Census Data into their availability analysis for their 2014 plans.  In addition, contractors who establish goals for their 2013 plans using old census data should consider rerunning their availability analysis using the 2010 Census Data to see if it eliminates or reduces goals.

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OFCCP Seeks Debarment of Federal Contractor

According to a January 17, 2013 press release, the Office of Federal Contract Compliance Programs (“OFCCP”) has filed a lawsuit against U.S. Security Associates, Inc. (“USA”) with the Office of Administrative Law Judges (“OALJ”) seeking to cancel its contracts and debar it from being award future contracts for refusing to submit affirmative action plans and other documents during audits.  USA has previously been awarded $8 million in federal contracts to provide uniformed and trained guards and other emergency responders to the federal government.

OFCCP sent USA scheduling letters on December 7, 2011 and December 13, 2011 to conduct a compliance reviews of USA’s Milwaukee and Portage establishments.  USA refused to submit the information OFCCP requested.  On June 21, 2012, USA filed a complaint with the OALJ seeking declaratory relief from OFCCP’s compliance reviews.  An Administrative Law Judge (“ALJ”) dismissed USA’s complaint for lack of subject matter jurisdiction, and USA appealed the decision to the Administrative Review Board where the matter is currently pending.

Since USA filed its complaint, OFCCP has continued to request documents from the company, which USA has refused to submit. According to the press release, USA currently has twenty sites with open compliance evaluations.

In OFCCP’s complaint, it has requested the OALJ order USA to provide it with access to “all documents and information requested” and “cooperate” with the compliance reviews.  If USA fails to comply, OFCCP has requested the OALJ to “cancel all of USA’s current government contracts and to debar the entire company from entering future contracts.”

OFCCP has issued this press release as a warning that it will vigorously pursue enforcement actions against contractors who fail to provide OFCCP access to documents.  Director Patricia Shiu stated that “[p]roviding OFCCP investigators with access to the documents they need in order to do their jobs is not optional.”  OFCCP also noted that the “issue of providing OFCCP with access to such information has been affirmed by the courts numerous times.  In November 2011, Chief Judge Royce C. Lamberth of the U.S. District Court for the District of Columbia ruled, in a similar case, that ‘Submission to such lawful investigations is the price of working as a federal contractor.’”

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Filed under Affirmative Action Plan (AAP), Department of Labor, OFCCP

OFCCP Unveils Its 2013 Regulatory Agenda

On December 21, 2012, the Office of Federal Contract Compliance Programs (“OFCCP”) unveiled its 2013 Unified Agenda of Regulatory and Deregulatory Actions (“Unified Agenda”) on the Office of Management and Budget’s (“OMB’s”) website.  In the first-term of the Obama Administration, OFCCP proposed a number of regulatory changes, including significant changes to Section 503 of the Rehabilitation Act and the Vietnam Era Veterans Readjustment Assistance Act (“VEVRAA”) that contemplated requiring contractors to undertake additional affirmative action obligations for individuals with disabilities and covered veterans.  In 2012, many of these regulatory initiatives were put on hold in light of the presidential election. Now that President Obama has won reelection, the OFCCP intends to aggressively pursue its regulatory agenda once again.

According to the Unified Agenda, OFCCP is planning to implement or propose several major regulatory initiatives in 2013:

Final Rules on Section 503 of the Rehabilitation Act:  In December 2012, OFCCP released its proposed rules for Section 503 of the Rehabilitation Act.  The proposed rules contemplated requiring contractors to undertake a number of additional affirmative action obligations for individuals with disabilities, including establishing a seven percent goal in each job group at the contractors’ establishments for disabled individuals. See our prior post for the details of OFCCP’s proposed changes to Section 503.  OFCCP indicated in its Unified Agenda that it plans to release final rules on Section 503 in April 2013.

Final Rules on VEVRAA:  In April 2011, OFCCP released its proposed rules for VEVRAA. Similar to Section 503, the proposed changes to VEVRAA would require contractors to engage in various recordkeeping and other obligations designed to increase protections for covered veterans.  See our prior post for more information on OFCCP’s proposed changes to VEVRAA.  Through its Unified Agenda, OFCCP has indicated that it plans to release the final rule on VEVRAA in April 2013.

Proposed Rule on the Compensation Data Collection Tool:  In August 2011, OFCCP released an Advanced Notice of Proposed Rulemaking to solicit input on a compensation tool that OFCCP could use to analyze contractors’ compensation practices.  In August 2012, the National Academy of Sciences (“NAS”) lambasted OFCCP for failing to articulate adequately how it would analyze compensation data and urged the agency not to move forward with increased data collection requirements until it addressed some of the current deficiencies.  Despite these recommendations, OFCCP plans to unveil its new compensation data collection tool through a Notice of Proposed Rulemaking (“NPRM”) in June 2013.

Proposed Changes to the Sex Discrimination Guidelines:  OFCCP intends to issue proposed rules on its Sex Discrimination Guidelines by August 2013.  OFCCP has indicated that the Sex Discrimination Guidelines “have not been updated in more than 30 years and warrants a regulatory lookback.”  OFCCP plans to “create sex discrimination regulations that reflect the current state of the law in this area” and reflect the increased “participation in the labor force” of women.

Proposed Regulations for Construction Contractors:  OFCCP plans to issue proposed rules revising the regulations governing federal constructions contractors by October 2013.  OFCCP has stated that these rules would “enhance the effectiveness of the affirmative action programs of . . . construction contractors” by removing “outdated goals” and giving “contractors increased flexibility to assess their workforce to determine whether disparities in the utilization of women or the utilization of a particular racial or ethnic group in an on-site construction job group exists.”

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Filed under Affirmative Action Plan (AAP), Compensation, Department of Labor, Disability Discrimination and Accommodation, Discrimination, OFCCP, Veterans

Some OFCCP Regions Halt Audit Submission Extensions

Contractors usually have thirty days from the day they receive a scheduling letter and itemized listing from OFCCP to submit their affirmative action plan and other requested documents and data.  In the past, many regions have afforded contractors short extensions on that deadline.

However, certain OFCCP Regions have prohibited compliance officers from granting extensions.  For example, the Southeast and Mid-Atlantic Regions have been directed not to grant extensions beyond the 30-day deadline for responding to scheduling letters.  In the Mid-Atlantic Region, all requests for extensions must be approved by the District Director for the District to which the compliance officer is assigned.  On the other hand, other regions have continued their practice of granting extensions.

Given these new policies, contractors should undertake periodic “pre-audits” to confirm that all of the information and data they need to respond to a scheduling letter is prepared and can be submitted within the 30-day deadline.

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OMB Approves OFCCP’s FAAP Directive

On December 11, 2012, the Office of Management and Budget (“OMB”) approved the Office of Federal Contract Compliance Programs’ (“OFCCP’s”) directive to establish a new application process for contractors seeking approval to use functional affirmative action plans (“FAAPs”).  A FAAP is an affirmative action plan that is structured by functional or business unit rather than establishment. Contractors have to receive approval from OFCCP before they can use FAAPs to analyze their workforce.

On June 14, 2011, OFCCP issued Directive Number 296, which announced a new process for contractors seeking to obtain approval to use FAAPs.  Under the new procedures, OFCCP would only approve FAAP agreements if the contractor met certain threshold requirements, such as having functional or business units that have their own manager with at least 50 employees.  OFCCP also established procedures that contractors must follow when requesting approval of FAAP agreements, including submitting detailed documentation that OFCCP would use to determine whether it would approve the agreement.

Earlier this year, OFCCP had to halt the implementation of this directive because it came to OFCCP’s attention that the FAAP directive constituted an information request that fell under the Paperwork Reduction Act (“PRA”) and required OMB approval.  The PRA requires federal agencies to receive OMB approval before they issue the same information collection request to 10 or more contractors.

On May 22, 2012 and October 11, 2012, OFCCP published notices in the Federal Register that it was seeking OMB approval of the FAAP directive.  Despite receiving comments from the contractor community about how these procedures were overly burdensome and discouraged contractors from seeking FAAP agreements, OMB found that the FAAP directive met the requirements of the PRA.  As a result, OFCCP is authorized to collect information under the FAAP directive until the end of 2015.

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ARB Overturns Favorable Decision for Contractors

On May 8, 2012, the Administrative Review Board for the Department of Labor (“ARB”) reversed a very favorable ruling for contractors, holding that the Office of Federal Contract Compliance Programs (“OFCCP”) could request data from contractors during desk audits concerning hiring, terminations and promotions after the period covered by OFCCP’s initial Scheduling Letter. 

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Unemployment of Veterans Decreases as OFCCP Increases Obligations for Veteran Employment

Employment of veterans has significantly improved over the past year, according to new data from the Bureau of Labor Statistics (BLS).  The BLS’s report shows that from February 2011 to February 2012, the unemployment rate for veterans 18 and older decreased from 9.2% to 7.0% – lower than the unemployment rate for nonveterans. 

These strong statistics coincide with new government efforts to boost job prospects for returning members of the armed forces.  On April 26, 2011, the U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) published proposed regulations that would impose additional affirmative action obligations on federal government contractors under the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA).  Once finalized, the regulations would require contractors, among other things, to (1) take certain mandatory actions in recruitment, recordkeeping and dissemination of affirmative action policies relating to protecting veterans; (2) establish annual hiring benchmarks to track the effectiveness of their affirmative action programs; (3) request disclosure information from applicants; and (4) collect data concerning job referrals.

In addition, the Department of Labor (DOL) proposed new regulations this past February implementing amendments to the military leave provisions of the FMLA.  These proposed regulations, once finalized, would (1) extend the availability of FMLA leave to family members of members of the Regular Armed Forces for qualifying exigencies arising out of the servicemember’s deployment; (2) extend FMLA military caregiver leave to family members of certain veterans with serious injuries or illnesses; and (3) allow eligible employees to take 15 days off when a service member comes home for rest and recuperation rather than the five days currently allowed.

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Filed under Affirmative Action Plan (AAP), Department of Labor, OFCCP, Veterans

OFCCP Rejects Requests to Extend the Comment Period for its Proposed Rule That Would Drastically Expand Contractor’s Obligations for Individuals with Disabilities

On January 27, 2012, the Office of Federal Contract Compliance Programs (“OFCCP”) rejected requests from the contractor community to provide additional time for comments on its proposed regulations under Section 503 of the Rehabilitation Act of 1973 (“Rehabilitation Act”) that would impose fundamental changes in federal contractors’ obligations involving persons with disabilities.  On December 9, 2011, the OFCCP issued a proposed rule that would amend the Rehabilitation Act.  A summary of the proposed rule is provided below.

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Filed under Affirmative Action Plan (AAP), Department of Labor, Disability Discrimination and Accommodation, Discrimination, EEO, OFCCP