Affirmative Action Compliance – Developments Employers Should Watch
June 15, 2010
The following are some issues which employers with covered federal contracts should monitor, all relating to required Affirmative Action Plans.
Desk audits
Based on our recent experience, OFCCP is more closely scrutinizing employers’ written Affirmative Action Plans (“AAPs”) as part of its normal desk audit process. Many federal contractors, including depository institutions, are subject to the requirement pursuant to Executive Order 11246 that they create and maintain written AAPs. Generally, the employer must have a federal contract equal to or exceeding $100,000 and have a minimum of 50 employees to be subject to the requirement.
The AAP is designed to help ensure that, by occupation, minorities and women are represented in sufficient numbers in an employer’s workforce. If not, the employer agrees to take steps to help ensure increased minority/female representation. Most employers in Maine rarely experience significant “underutilization,” meaning workforces reflecting percentages of minorities and females less than what you would expect to see statistically, based on the area labor pool and percentages of minorities and females generally. At times, employers see female underutilization in the executive ranks, but that is becoming less and less common.
To check on whether subject employers are complying with the law, OFCCP audits employers by first requesting a copy of the contractor’s AAP. The contractor/employer then has 30 days to respond to the request. If the contractor has no written plan, it will be a busy 30 days. If the contractor has a plan, it should make sure it is up-to-date and complete before submission to OFCCP. Once the AAP is submitted for review, the employer can typically sit back and wait for up to a year before OFCCP makes a decision as to whether the AAP meets its standards. In connection with these so called “desk audits,” OFCCP appears to be requesting more information than in the past, and over a longer period of time. In past years, OFCCP rarely asked many questions of an employer after it submitted its AAP for review. It seems that OFCCP is now more closely reviewing the AAPs to determine compliance.
2010 Census
In addition to this apparent increased scrutiny from OFCCP, employers should prepare to update their AAPs to reflect the 2010 Census data when that information becomes available. Employers who develop AAPs generally rely on the U.S. Census Bureau’s EEO file to obtain data for their plans. For the past 10 years, the underlying data in the U.S. Census’ EEO file was based on the 2000 Census. Accordingly, employers, in updating their AAPs over the past decade, need only have updated their workforce data from year to year. Next year, employers will need to revisit the underlying data to ensure that they are using the most up-to-date information available. For some larger employers who are not able to use general EEO categories for AAP purposes, this can be a significant task.
USDOL regulatory agenda
Finally, the U.S. Department of Labor’s regulatory agenda states that USDOL will conduct rulemaking with regard to AAP obligations for construction contractors. The regulatory agenda narrative states the following in this regard:
Construction Contractor Affirmative Action Requirements (OFCCP)
The Office of Federal Contract Compliance Programs (OFCCP) currently requires employers and other regulated entities to create affirmative action programs in some contexts. During the Spring 2010 Regulatory Agenda cycle, OFCCP intends to continue work on a notice of proposed rulemaking (NPRM) that would enhance the effectiveness of the affirmative action program requirements for Federal and federally assisted construction contractors and subcontractors. The NPRM would remove outdated provisions and update the regulations that set forth the actions construction contractors are required to take to implement their affirmative action programs and would address the content of those programs in the areas of recruitment, training, and apprenticeships.
Although short on detail, the recent regulatory agenda reflects the USDOL’s new “plan, prevent, protect” enforcement strategy. There will undoubtedly be more to come on this and other laws enforced by the USDOL.
Our firm regularly assists employers in preparing and maintaining AAPs and responding to audits from OFCCP.
Please contact Matt Raynes at our Bangor, Maine office with questions.
This paper is provided as general information, and is not a substitute for legal or other professional advice.
