The Office of Federal Contract Compliance Programs (OFCCP), an agency of the U.S. Department of Labor (DOL) that administers and enforces the federal affirmative action laws, has become reenergized and refocused during the Obama administration. The OFCCP has new leadership, is better staffed, better funded, and more motivated than in any previous administration in recent history.
The OFCCP’s Director, Patricia Shiu, has promised that the OFCCP will be extremely proactive and aggressive. OFCCP’s Fall 2010 Regulatory Agenda and Director Shiu’s January 7, 2011 live web chat clearly identify OFCCP’s goals: strengthening affirmative action requirements for all contractors; emphasizing compliance with those requirements with respect to veterans, people with disabilities, and women and minorities in construction trades; and eliminating compensation discrimination against women.
The following is a summary of the highlights from Director Shiu’s recent web chat, including contractors’ new requirements and OFCCP initiatives contractors can look forward to in 2011 and beyond.
Use of Active Case Management Discontinued
On December 2, 2010, OFCCP issued a Directive officially discontinuing use of its Active Case Management (ACM) procedures for conducting federal contractor compliance evaluations. OFCCP had previously conducted abbreviated desk audits and only conducted on-site audits where there were indicators of systemic discrimination. With the rescission of ACM, contractors should expect more thorough desk audits and more on-site audits.
New Compensation Data Collection Tool To Be Adopted
On January 3, 2011, the OFCCP published a proposal to rescind the Bush Era Systemic Compensation Discrimination Standards and the Voluntary Guidelines for Self-Evaluation of Compensation Practices and plans to adopt a new compensation data tool. OFCCP anticipates publishing an Advance Notice of Proposed Rulemaking (ANPR) in February, concerning development of the new compensation data collection tool. OFCCP will not reissue the Clinton Era Equal Opportunity Survey, but with the new compensation tool, OFCCP hopes to reinstitute discretion and flexibility in investigating compensation discrimination.
New Rules Regarding Affirmative Action for Veterans and Individuals with Disabilities
In July 2010, OFCCP published two ANPRs regarding affirmative action for veterans and individuals with disabilities by which OFCCP seeks to increase contractors’ affirmative action obligations and to include numerical targets to measure the effectiveness of contractors’ affirmative action efforts. In support of this effort, on October 28, 2010, the DOL made available on its website the “Veterans Hiring Tool Kit,” which provides a six-step process to help employers design a veteran hiring initiative. The proposed rules for veterans are expected any
day, while the proposed rules for the disabled are projected for publication this August.
New Rules Regarding Construction Contractors
In another ANPR, OFCCP announced its plans to amend requirements for construction contractors to strengthen the effectiveness of their affirmative action requirements, particularly in the area of recruitment and job training, and to revamp affirmative action goals for women and minorities in construction trades. Look for the proposed rule regarding construction contractors in July 2011.
FAAPs To Be Reinstated
In 2002, the OFCCP issued a Directive permitting contractors to combine multiple establishments that form a business unit into one “Functional AAP,” with OFCCP’s approval. In the spring of 2010, OFCCP placed a moratorium on approving new FAAPs while it reviewed its internal processes. In her web chat, Director Shiu indicated that the OFCCP will be issuing new guidance on FAAPs in the very near future.
New Compliance Manual
Director Shiu also stated that she anticipates completion of the newly revised and updated Federal Contractor Compliance Manual (FCCM) within the next 60 days.
Continued Use of CSALs
Corporate Scheduling Announcement Letters (CSAL) are a courtesy OFCCP provides contractors with two or more establishments on its scheduling list. OFCCP anticipates sending out its next round of letters this spring.
Continued Use of FCSS to Select Contractors for Audit
In 2004, OFCCP adopted the Federal Contractor Selection System (FCSS) for identifying contractors for compliance evaluations, purportedly to target facilities based on the likelihood of discrimination against minorities and females in hiring and promotion. OFCCP has indicated that it will continue to use FCSS, and will continue using its current scheduling letter. However, OFCCP will no longer review I-9s as part of its compliance review process.
OFCCP has signaled strong intentions to increase contractors’ affirmative action obligations, root out compensation discrimination, and get “back in the enforcement business.” Expect OFCCP to increase attention to veterans and individuals with disabilities, as well as the construction industry. Federal contractors and subcontractors should take proactive steps to comply with the federal affirmative action laws to reduce liability for discrimination.