2015 in Review
2015 was a year of updates and changes for the federal contractor community. The number of audits and monies collected compared to previous years decreased by 50% as it appears that audits are taking more time and more resources for the Office of Federal Contract Compliance Programs ("OFCCP"), as the office dives deeper into a company's processes, and field investigators acclimate to the changing regulations themselves.
Compensation equity was an OFCCP focus in 2015 and those audits focused on "total compensation" or salary, benefits and other forms of comp. These analyses were more in depth than ever before. Hiring related cases in 2015 focused on entry level positions and possible "steering" - a type of discrimination that can be alleged when an employer assigns newly hired employees into different, typically entry-level positions with different pay rates based on race and/or gender. Also new in 2015, the OFCCP introduced a class member locator to identify aggrieved applicants. Employers can review the class member locator on the OFCCP site including links to full conciliation agreements here: http://www.dol.gov/ofccp/cml/index.htm.
Be Prepared in 2016
2016 will see compliance efforts resulting from Executive Order ("E.O.") 13672 protecting LGBTQ workers and applicants from discrimination that became effective in April 2015. This E.O. amended E.O. 11246, revising the equal opportunity clause used in contracts, sub-contracts and tag lines. Employers must include "gender identity" and "sexual orientation" in all materials on which the organization displays the list of protected classes. Employers will be required to display the updated "EEO Is The Law" poster as soon as it has been finalized by the EEOC and OFCCP. Check the www.eeoc.gov website for the most up to date federal posters. It is a best practice to include the additional wording in any publication where the full list of protected classes is used.
Pay transparency went into effect January 11, 2016. The final rule amends E.O. 11246 and requires contracts, subcontracts, and employee handbooks to be updated to state that contractors and subcontractors will refrain from discriminating against employees and applicants who inquire, discuss, or disclose their compensation or the compensation of other employees and applicants unless the information was obtained in the course of performing essential job functions. Employers must update employee handbook policies and disseminate the non-disclosure provision to employees and job applicants. In addition, employers should review pay transparency and pay equality rulings within their states as California and New York now have state specific pay transparency requirements.
Two other updates include a February 2015 final rule from the DOL on the definition of "spouse" under the Family and Medical Leave Act ("FMLA") and the regulation now covers those in same-sex and common law marriages. In addition, E.O. 13658 increased the Federal Contractor minimum wage to $10.10 effective January 1, 2016.
VEVRAA (Veterans, http://www.dol.gov/compliance/laws/comp-vevraa.htm) and Section 503 (Disability,http://www.dol.gov/ofccp/regs/compliance/section503.htm) should now be fully implemented. The regulations were revised in 2014 to include the collection of veteran and disability information on applicants and employees; hiring benchmarks for Veterans of 7% in all job groups; and utilization goals of 7% for every job group for individuals with disabilities. These assertive regulations require effective outreach strategies to meet the new goals. Additionally, the OFCCP expanded its scheduling letter to include requests for many more data points than it had in the past.
Employers must now also conduct a documented annual Personnel Process Review to ensure that updates to their processes are in line with regulation changes. This review should include any follow-up actions to be taken. Requests for accommodations from employees and applicants now require tracking in a reportable format and are requested at the beginning of an audit. State regulations for accommodations should also be reviewed as several states passed specific protections regarding pregnancy accommodation. Employers should also ensure that minimum qualifications for all positions are documented - especially for entry level positions - and check state laws regarding minimum wage, pay transparency, and accommodations.
Staying up-to-date with OFCCP, DOL and EEOC regulations not only keep your company in compliance, but also strengthen your company’s’ commitment to creating a respectful workplace, diversity and equal opportunity.