Q&A: DON’T ASSUME PAST IS PROLOGUE FOR OFCCP-REGULATED CONTRACTORS

 Statute

As 2015 winds down, some federal contractors are probably working on regulatory assignments involving the Office of Federal Contract Compliance Programs, thinking that more new compliance requirements may be on the way in 2016.

During the past six years, the agency has proposed, implemented and revised a host of regulations designed to assist government contractors in meeting their equal employment opportunity and affirmative action obligations under Executive Order 11,246, Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans’ Readjustment Assistance Act of 1973.

Yet, the agency’s 2016 fiscal-year budget authorized by Congress may affect some proposed compliance requirements from being finalized, according to attorney Linda Cavanna-Wilk of Ford and Harrison, LLP in New York. Cavanna-Wilk tells Bloomberg BNA what compliance audits looked like in 2015, and shares her 2016 outlook on the agency’s enforcement.

Bloomberg BNA: In 2015, what has stood out to you as the most significant moment or development in OFCCP enforcement and compliance?

Cavanna-Wilk: After several years of significant changes that the contractor community has struggled to keep up with, nothing in particular stands out in OFCCP enforcement and compliance in 2015, which may by itself be telling. This year finally gave contractors an opportunity to implement the required policy and practice changes.   

However, the year closed with what may prove to be a meaningful development. The OFCCP's budget was reduced by one million dollars when the agency asked for a six million dollar increase to create infrastructure needed to implement the Equal Pay Report.  This leaves us wondering if that initiative may be finished until a new presidential administration.

Bloomberg BNA: In working with contractors in 2015, have you noticed any emerging or new trends or tactics adopted by compliance officers during reviews, especially in light of the revised scheduling letter and itemized listing, and the new Section 503 and VEVRRA regulations?

Cavanna-Wilk: In 2015, the OFCCP had fewer compliance reviews, with the most noticeable decline coming by spring 2015.For the reviews that were conducted, the focus continued to be on compensation as well as applicant-to-hire data.

If the OFCCP identifies a “potential discrepancy or red flag” then a compliance review becomes longer, including significant document production, a compensation interview and typically many requests for compensation practice information.

Also in 2015, enforcement related to the new Section 503 and [VEVRAA] regulations were first subject to [compliance] reviews. Because most companies were in transitional affirmative action plans, the OFCCP was primarily looking to ensure that contractors were aware of changes and had begun to implement them.

Bloomberg BNA: In 2016, what will you closely monitor when it comes to OFCCP enforcement and compliance?

Cavanna-Wilk: In 2016, our attorneys will be watching for trends in investigating new Section 503 and [VEVRAA] regulations. Most contractors will be in their first full year under the revised regulations, so we will look to understand how the OFCCP compliance review process will change. For example, what will be acceptable for action oriented plans?

We will also continue to assist clients with their applicant-to-hire data, as well as applicant tracking software issues.  We will walk clients through the process of using a pre-employment tests as the OFCCP and Equal Employment Opportunity Commission continue to monitor those selection devices.

Finally, we will work with clients on cleaning up job titles, as companies tend to lump different jobs into the same job title so that fewer job titles are needed in HRIS [human resources information systems] and payroll. 

Bloomberg BNA: Any final thoughts?

Cavanna-Wilk: Compliance reviews and settlements are down, but reviews are taking longer to close; the OFCCP offices are talking to each other and sharing information about the same contractors. At the same time, the OFCCP is conducting more interviews, and requesting substantial additional data.  

The OFCCP will use reviews in 2016 to ensure compliance with new regulations – minimum wage, notice posting requirements, [prohibitions on sexual orientation and gender identity discrimination], disability solicitation forms, and “enhanced” outreach requirements. They will work to ensure that outreach assessments are done, and that job descriptions are being reviewed.

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