OFCCP Week In Review: October 22, 2018

The OFCCP Week in Review (WIR) is a simple, fast and direct summary of relevant happenings in the OFCCP regulatory environment, authored by experts John C. Fox, Candee Chambers and Jennifer Polcer. In today’s edition, they discuss:

• Craig Leen Addresses NELI Attendees
• New Recognition Program Announced
• Scheduling Letters Out

***Addendum: October 23, 2018
We have received an overwhelming response to the “New and Frightening” piece in this WIR. So much in fact, that we want to expand to ensure our readers fully comprehend. The review of all covered Government Contractors is a goal under the AAP Verification Directive. Director Leen spoke to his vision for this Directive to include a way to reach 100% of Contractors. Ideally, there will be a certification process for all, with follow-up audits for those showing likely indicators of potential problems (yet to be identified). The bottom line remains the same, Contractors who meet the thresholds of requiring a written AAP should be doing so, with or without the threat of an audit. A certification process is coming! We will unpack and break down additional details as they become available.

Thursday, October 18, 2018: Craig Leen Addresses NELI

In his self-proclaimed “longest speech” since becoming OFCCP Acting Director in July, Director Craig Leen gave NELI (National Employment Law Institute) attendees a special treat at a session of “What’s on the OFCCP Director’s Desk?” It  was fitting for Director Leen to be a guest speaker at this particular NELI event as it was the annual Affirmative Action Briefing, the 36^th to be exact. This program consists of a one day workshop outlining the history of how Affirmative Action came to be, followed by the nuts and bolts instruction for developing AAPs. The second and third days dive into recent events and trends from the previous year. As this past year has been a busy one, and Director Leen is continuing to pick up the pace of change at OFCCP, it was ideal to hear about these many changes from Director Leen.

Also, Director Leen took the occasion, as many OFCCP Directors have done over the years at the NELI Affirmative Action Briefing, to drop some “bombshells” and identify new policy directions, including a coming 100% audit as to all contractors and all AAPs! See below.

OFCCP has been moving quickly this year with no signs of slowing down. Starting the year by sending out 1000 CSALs in January and an additional 750 CSALs in September, contractors are on notice of almost 1800 coming audits. While the future audits are now not a surprise given the CSALs, what is surprising is the additional information and guidance OFCCP is transparently publishing to contractors. Nine new Directives this year, thus far. Spoiler Alert: Three more Directives to come this week! To put this into context, OFCCP issued the last Directive before this year in 2015, and before that, issued only two in all of 2014. Town Hall meetings have led to an overall Action Plan for the agency which is driving the guidance and transparency we now enjoy.

For our regular readers, we report below the items as they emerged in Director Leen’s presentation. You can take a deeper dive  via the many embedded links below, which will also take you directly to any documents discussed.

Director Leen organized his presentation as an outline of the “Four Principles for OFCCP” which he has laid out. For each principle, he provided examples of OFCCP actions and what we may see in the future.

1. Transparency. No more mystery! Items already in play include:
   • Employer “Bill of Rights.”
   • Directive on Transparency.
     Note: Keep this one handy when going through a compliance review! Per Director Leen in Q&A: the Transparency Directive DOES apply to current Compliance Evaluations and now requires OFCCP District Offices to, among other things, tell contractors the basis for any adverse findings the agency is sponsoring.
     
   • Compliance Review Scheduling Methodology.
   • Posting of the names and locations of the Contractor establishments OFCCP has selected for upcoming Compliance Evaluations.
     Note: Per FOIA rules, federal agencies the FOIA covers must now post in their FOIA “Reading Rooms” (located on their agency websites) all non-exempt documents if the agency receives three or more requests from the public for any document in the agency’s possession.
     
   • Directive on Ombuds Service. This individual(s) (yet to be hired) will be able to look neutrally at situations and help Contractors identity if they are being treated differently from other contractors in an audit. If so, the Ombud will be able to assist by suggesting course corrections to both parties. This will be a GS15 position which will report to a career Deputy Director (currently expected to be Marika Litras, OFCCP’s Enforcement Director). Interested individuals should apply!

There is more to come in this space. Enhancements to OFCCP’s Help Desk, including more specific and uniform answers, a revamp of the FAQ section of the OFCCP website (edits, updates, streamlined and corrected content), and (eventually) Opinion Letters similar in concept to those the Wage and Hour Division of USDOL currently (again) issues.

2. Certainty. Rule of Law perspective. If contractors are to be held accountable, then the expectations for how to be compliant need to be clear.
   • Compensation Directive.
   • Religious Exemption Directive. This was the first Directive Director Leen signed as Acting Director. He assured us that this Directive in no way allows for discrimination on the basis of sexual orientation, only that OFCCP will follow the law surrounding sincere religious beliefs by religious organizations. (So far, the Courts have exalted religious liberty over the freedom not to be discriminated against because of one’s sexual orientation when those two freedoms clash…although more cases are arising on this clash as large segments of our nation continue to be discomforted with this clash of competing values).
     Note: Rulemaking will follow. No date certain currently  known…perhaps December 2018…
   • TRICARE Moratorium extended.
   • Mandatory use of Predetermination Letters when OFCCP is alleging unlawful discrimination.

3. Efficiency. Reduce the time for completing compliance reviews! “Make a finding or move on!” exclaimed Director Leen.
   • AAP Verification Program. Director Leen expanded here on his vision to eventually cause all covered Government Contractors obligated to have Affirmative Action Plans, to certify under penalty and perjury of law that the company has developed all AAPs it is supposed to have in place. Currently, OFCCP is coordinating with the Government Services Administration (GSA), responsible  to administer the nation’s federal government contracting program, to gain access to verifications federal contractors currently make to GSA about their AAPs when bidding for contracts working off of the GSA certifications, OFCCP is exploring how it might audit those contractors checking “no” or “n/a.”
     Action Item: Now that they are becoming important for the first time in history, Contractors should review their GSA certifications to ensure their accuracy. You might start to locate this information by identifying who in your organization is completing this question on the GSA RFPs! Start by asking procurement, sales or your procurement lawyers.
   • ***New and Frightening: Director Leen also outlined his plan to eventually position OFCCP to audit – over a five-year period – 100% of all covered Government contractors which have AAPs. AND, to audit all of the AAPs of those contractors in the process. While OFCCP has not finalized its plans to launch this five-year audit cycle, a good bet – knowing how the federal government works – is that OFCCP is attempting to position this “100% quality control check” of Government Contractor AAPs to likely begin in FY 2020 ( beginning October 1, 2019…a year from now). Because OFCCP cannot expect staffing nearly commensurate with that volume of AAPs (OFCCP currently audits ½ of 1% of the total number of AAPs it is estimated OFCCP’s Rules require of covered federal Government Contractors), we assume OFCCP will be auditing objective numerics reported in AAPs (Goals & Data Metrics, for example) and in the Disparity Analyses contained within the AAP for Minorities and Women. We will continue to follow this significant new policy development as OFCCP continues to flesh it out in the coming months.

4. Recognition
   • Contractor Recognition Program. The Excellence in Disability Inclusion Award is currently open for public comment. Also, see Friday’s release of the LEAD Award, discussed below.
   • Additional awards across all categories of equal employment opportunity and inclusion are in the works.

Other noteworthy comments from Director Leen included well wishes and gratitude for Debra Carr’s service. Ms. Carr has now left the OFCCP Director of Policy & Program Development position and is now with the Job Corps within USDOL. Harvey Fort is currently serving as OFCCP’s Acting Director of Policy.  Director Leen also reminded the NELI audience that the window for comments and suggestions on the revision of the Functional Affirmative Action Program (FAAP) is currently open. Special note here – OFCCP’s proposal takes away the mandatory compliance review, so get your comments in!

Friday, October 19, 2018: New Recognition Program Proposed

OFCCP and the Women’s Bureau are joining efforts to recognize contractor best practices in comprehensive equal employment opportunity and nondiscrimination programs. The proposed Leadership in Equal Access and Diversity Award (LEAD) will acknowledge supply and service contractors that go above and beyond OFCCP’s Rules to create and implement programs of inclusion and fair treatment in the workplace, regardless of race, color, sex, sexual orientation, gender identity, religion, national origin, disability, or status as a protected veteran, and recognize the importance of fairness in compensation practices and pay transparency.

The eligibility requirements are similar to those for the Disability Inclusion Award. The contractor must have established AAPs for EO 11246, Section 503, and VEVRAA and be in good standing with OFCCP. Important to note is that compliance is a condition to receive the award and the finalists are required to cooperate with OFCCP to ensure current compliance. Therefore, finalists must have undergone an OFCCP Compliance Evaluation within the past two years or must agree to undergo at least a Desk Audit before their selection is final. Failure to agree to the Desk Audit, if required, is disqualifying. As a result, those contractors OFCCP has audited in the last two years are prime candidates to apply for this Recognition Award.

Areas evaluated for the award include:

• Outreach, Recruitment and Hiring
• Training and Advancement
• Corporate Culture/Work Environment
• Retention
• Compensation Practices

The Award

OFCCP will pick six contractor Equal Access and Diversity programs to recognize. The six awardees will work with OFCCP to provide feedback and develop training and compliance assistance materials. OFCCP will also ask awardees to share their individual opinions and perspectives.

Further, the award recipients will receive a three-year moratorium from scheduled compliance evaluations from the date OFCCP presents the award. Award recipients are not exempt from OFCCP complaint investigations.

The Timeline

OFCCP anticipates that it will present the first awards in FY 2019. At that time, the award recipients will enter the three-year (36 calendar months) moratorium period.

Items available to review and comment include:

• LEAD Supporting Statement 60 Day
• LEAD Nomination Form
• LEAD Form Instructions

The last day to submit comments on this proposal is December 18, 2018.

Monday, October 22, 2018: Scheduling Letters Out

It’s time to shout from the mountaintops and let your locations know that Audit Scheduling Letters will begin to go out today. If you received a CSAL from the September 7, 2018 batch, the 45-day “delay of audit window” is up. Formal letters indicating that your Affirmative Action Plan needs to be turned in, are on their way.

Who should be on the lookout?

Confirm if one or more of your establishments are on the list here. 

What should you do?

Notify locations to be on the lookout for the letter. If you haven’t already, ensure you are “eligible” for a Compliance Evaluation. There are a handful of exceptions as well as limits to the number of Compliance Evaluations a contractor can receive. We recapped that here, and the full breakdown is here.

Important to Remember

Beginning with all compliance evaluations after September 7, 2018, 30-day extensions may be provided for supporting data (i.e., the data requested in the Itemized Listing) as long as the request is made before the initial 30-day due date for the AAPs.

Please note OFCCP’s warning: “OFCCP generally will not allow extensions for submission of the basic EO 11246, Section 503 and VEVRAA AAPs, which contractors are required to maintain and update annually, nor allow extensions of supporting data if requested after the submission date for the AAPs has passed.” OFCCP has not announced what it will do in the future as to contractors which turn in their AAPs late.

DirectEmployers Members, please reach out to your Membership Representative for any assistance you may need to pull your proof of job listings, obtain additional audit support or if you have any questions.

THIS COLUMN IS MEANT TO ASSIST IN A GENERAL UNDERSTANDING OF THE CURRENT LAW AND PRACTICE RELATING TO OFCCP. IT IS NOT TO BE REGARDED AS LEGAL ADVICE. COMPANIES OR INDIVIDUALS WITH PARTICULAR QUESTIONS SHOULD SEEK ADVICE OF COUNSEL.