By: Melanie Berkowitz, Esq.
Any employer -- large or small -- who wishes to do business with the Federal government must be familiar with the Office of Federal Contractor Compliance Programs (OFCCP) and OFCCP compliance. The twofold mission of the OFCCP is to ensure that contractors doing business with the Federal government:
- Do not discriminate against applicants or employees
- Take affirmative action to ensure that applicants are employed and employees are treated fairly during employment without regard to race, color, religion, sex, or national origin.
To fulfill its mission, the OFCCP places a number of requirements on all Federal contractors regarding hiring, recordkeeping and other terms and conditions of employment. The requirements are detailed and complex; contractors and those interested in becoming Federal contractors should carefully review the OFCCP's website, including its list of Frequently Asked Questions and its policy directives.
Economic uncertainty in the private sector has generated interest among employers who seek to contract with the government for the first time. Due to the complexity of OFCCP requirements, employers who are inexperienced in the Federal contracting process should educate themselves before they begin.
Is your entity a Federal contractor?
The first question any employer must answer is whether they are subject to the OFCCP requirements at all. Only employers who meet certain thresholds are considered Federal contractors and thus must adhere to the OFCCP procedures.
What do you need to do before being awarded a contract?
In most cases, employers interested in becoming a Ffederal contractor must undergo a "pre-award compliance review" of their employment practices. Once an employer is found to be in compliance with EEO directives, it may be placed on the National Pre-Award Registry. The Registry is searchable by employers and other Federal contractors who may wish to find approved subcontractors for a particular project.
What are the differences between construction contractors and "service and supply" contractors?
Construction contractors have special reporting and other requirements that differ from contractors that provide either services or supplies. The OFCCP has issued a technical guide to help construction contractors understand these requirements. The OFCCP also provides separate guidance for service and supply contractors to help them understand their requirements.
The OFCCP enforces three laws:
1. Executive Order (E.O.) 11246 prohibits discrimination and requires affirmative action to ensure that all employment decisions are made without regard to race, color, religion, sex or national origin.
2. §503 of the Rehabilitation Act prohibits discrimination and requires affirmative action in the employment of qualified individuals with disabilities.
3. The Vietnam Era Veterans' Readjustment Assistance Act (VEVRA) prohibits discrimination against specified categories of veterans protected by the Act and requires affirmative action in the employment of such veterans. Because the requirements for employers of veterans can be complicated, the OFCCP also publishes a list of Frequently Asked Questions specifically related to hiring veterans.
The basic affirmative action and equal employment opportunity obligations of Federal contractors are as follows:
- Provide equal employment opportunities and take affirmative action to employ and advance workers in a non-discriminatory manner
- Implement an affirmative action plan and maintain the required records
- Make your workplace and on-line application function accessible to people with disabilities
- Comply with all requirements of the Vietnam Era Veterans Readjustment Assistance Act of 1974
- Allow OFCCP access to your worksite during compliance reviews
- File an annual EEO-1 report
Federal contractors must compile and submit a so-called "EEO-1" report each year. The EEO-1 reports on the demographics of the employer's workforce by race/ethnicity and job title/level to help ensure that it is meeting affirmative action and non-discrimination requirements.
As part of their affirmative action plan, Federal contractors are required to maintain a number of records about their workforce including record of hires, promotions, transfers and terminations, as well a compensation information. Other information that should be retained includes:
- Job descriptions
- Job postings and advertisements
- Records of job offers
- Applications and resumes
- Interview notes
- Tests and test results
- Written employment policies and procedures
- Personnel files
Specific recordkeeping requirements apply under each of the laws the OFCCP enforces; employers should be familiar with them all. These records will eventually be used to create an EEO-1 report and must also be available in the case of a compliance audit.
Affirmative Action Requirements
Federal contractors must create and maintain an affirmative action plan. Answers to Frequently Asked Questions about affirmative action plans can help employers determine if their plan is in compliance with the law, and the Sample Affirmative Action Program can assist employres in development their own AAP.
The OFCCP requires that all federal contractors who accept job applications electronically make their on-line process accessible to individuals with disabilities. The OFCCP has created materials to educate contractors about their responsibilities towards applicants with disabilities.
As part of its mandate, the OFCCP conducts audits or reviews of Federal contractors' businesses, as described in its Federal Contractor Compliance Manual, to make sure they are in compliance with the law. Being subject to such a review does not automatically indicate a suspicion of wrongdoing by the Federal contractor. The OFCCP provides comprehensive compliance assistance for all federal contractors to help them prepare to be reviewed.
For example, as part of its assistance, the OFCCP publishes a comprehensive compliance manual to assist employers with their compliance issues and help them prepare for an OFCCP desk audit or on-site review of their workplace. In December 2010, the OFCCP instituted its Active Case Enforcement (ACE) procedure for monitoring compliance with its regulations and conducting audits of Federal contractors. ACE only applies to service and supply contractors.
The OFCCP is currently in the process of updating its scheduling letter which is used to inform a Federal contractor that it has been selected for a compliance review and to ask for information baout the workforce. The OFCCP's proposed regulations would greatly expand the body of information an employer must provide and has concerned some employers about the scope of the new requirements.
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Small Business Assistance
The OFCCP provides a basic overview of its requirements as they apply to small contractors. Some of the information (for example, a listing of employment practices that foster equal employment opportunities) is relevant to larger employers as well.
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