For more information please call  800.727.2766


10 Lessons From OFCCP Audits

The shift in policies of the Department of Labor under Hilda Solis's leadership has finally trickled down into the Office of Federal Contract Compliance (OFCCP). In Dec. 2010, the agency scrapped the Bush administration's Active Case Management Program and adopted an Active Case Enforcement (ACE) Program. A group of scheduling letters went out at the beginning of 2012, and the agency is aggressively tackling audits.

The OFCCP is contacting the EEOC, Wage and Hour, state/local Fair Employment Practice agencies, etc. to look at complaint history over the past three years to determine if there is any pattern/practice of non-compliance with government regulations and agencies. Additionally, they are looking at career websites for disabled accessibility and checking with the State Job Services to assure open positions are being posted with them.  Our practice during 2011 has shown that the OFCCP is digging deeper than we have ever seen. Compliance Officers are reviewing census codes, job titles, EEO-1 codes and the recruitment areas you are using. The recruitment process is scrutinized to make sure you demonstrate good faith efforts, are defining applicants correctly and recruiting processes are ADA accessible. Any adverse impact in any part of the employee cycle (applicant, hire, promotions, terminations) must be explained and can be delved into. 

Compensation equity remains a hot area of review. The OFCCP is conducting in-depth analyses regarding pay practices for similarly situated employees. The OFCCP proposed rules to change Veteran and Disability reporting:   if passed, federal contractors and sub-contractors will have to set goals for veteran hiring, track applicants by veteran status (similar to what is done for females/minorities), and establish a 7% goal for disabled hiring.  This is enough to make your head spin! So what can you do to prepare for this new era?  Here are our 10 tips for staying compliant with OFCCP regulations:

  1. Talk to your business development department, procurement department or other key sales people in your organization to determine if you are a federal government contractor or subcontractor.  We're encountering many situations where an audit letter was the first notice for HR or Legal that the company had entered the Affirmative Action space.
  2. Keep your plan up to date.  An Affirmative Action plan is an annual process. Be disciplined about putting it together, on time.
  3. Review all data for accuracy. Pay close attention to race, gender, and job titles to assure they are accurate.
  4. Conduct adverse impact analyses on applicant flow/hires; promotions and terminations. If there is any adverse impact, make sure the data sets are correct. Go back and investigate why potential adverse impact is occurring.
  5. Make sure you are defining "applicant" properly and recognize that less is more when it comes to applicants.
  6. Share your results with your management team. They don't need to know all the details of the statistics, but they do need to know areas of underutilization.
  7. Make sure your career page from your company website gives an alternate method to apply for those who can't use the on-line system due to disabilities.
  8. DEVELOP STRATEGIES FOR GOOD FAITH EFFORTS for females, minorities, disabled and veterans.  Document.  Your audit will focus on this - especially Veteran's and Disability resources.
  9. Post all your jobs with your state job service.  They will check.
  10. Regularly review compensation equity for similarly situated employees. Be able to explain differences in pay between people - is your system seniority driven? Performance driven? Skill driven? Experience driven? Do you have the back up documentation?

The OFCCP is changing and aggressively reviewing your employment practices. The best defense is always a good offense. Make sure you are on top of your compliance documents, outreach requirements and employment decision documentation. EPS has successfully assisted clients through complex plan generation and tough OFCCP audits. If you get an audit letter, please contact EPS  for assistance.