50 shades of grey the complexities of ofccp compliance in 2013

A Bridge to Tomorrow

75th Annual NHRMA

Conference & Tradeshow

Presented by

50 Shades of Grey The Complexities of OFCCP Compliance in 2013

Today’s presentation is a discussion including opinions regarding compliance issues and should not be taken as legal

advice. For formal legal advice attendees should seek legal counsel.

OutSolve

Your Presenters:

Patrick Savoy VP Operations

Chris Lindholm VP Compliance

• Celebrating 15 years of supporting Affirmative Action

Planning and Diversity for our clients

• Women’s Business Enterprise (WBE)

• Serving over 400 companies nationwide

• Supporting >100 OFCCP audits annually

Agenda

1. Impact of New Regulations

2. New Federal Contract Compliance Manual

3. Compensation Enforcement

4. Record Keeping and Adverse Impact

5. Audit Preparation

New Definition Disability:

From FAQ: How does the ADAAA define “disability?”

The ADA Amendments Act of 2008 (ADAAA) and the final

regulations define a disability using a three-pronged approach:

A physical or mental impairment that substantially limits one or

more major life activities (sometimes referred to in the regulations

as an “actual disability”)

A record of a physical or mental impairment that substantially

limited a major life activity (“record of”)

When a covered entity takes an action prohibited by the ADA

because of an actual or perceived impairment that is not both

transitory and minor (“regarded as”). [Section 1630.2(g)]

Impact of New Regulations

New Definition Veterans: Disabled veterans

Recently separated veterans (3 years)

Recipients of Armed Forces service medal

Served in active duty in war or campaign for which campaign

badge authorized

Under the Final Rule, a “protected veteran” is “a veteran who is

protected under the non-discrimination and affirmative action

provisions of VEVRAA

Contractor Solicitation – new paragraph requiring contractors to

state in their job solicitations and ads that they are equal opportunity

employers of protected veterans and individuals with disabilities



Transition Examples (Final Rule published in Federal

Register in September 2013 and effective March 24,

2014):

Annual plan date prior to 180-day implementation period

January 1, 2014 – Maintain current structure

January 1, 2015 – Implement Part C*

January 1, 2016 – AAP reflect results of new

regulations for first time

Parts A and B required 3/24/2014


Annual plan date after 180-day implementation period

• April 1, 2014 – Implement new plan requirements*

• April 1, 2015 – AAP reflect results of new regulations

• April 1, 2016 – Adapt outreach efforts towards reaching

goals

• Parts A and B required 3/24/2014


Disability Regulations - Section 503 of the Rehabilitation Act of 1973,

as amended (Section 503) at 41 CFR Part 60-741

Placement Goal

7% Goal for all job groups (Director can “review”)

EEO Categories acceptable if = Job Group

100 or fewer employees = goal is for entire workforce

No monetary violations so long as the process is undertaken

Sheltered workshops – cannot be used to meet goals


Veterans Benchmark

Just a goal right? – Not exactly

Benchmark equal to annual percentage supplied by OFCCP based on

1) National % of veterans in the civilian workforce*

2) Benchmark from BLS and VETS/ETA and factors developed by the

contractor

Three (3) year record keeping requirement

Analyze by Job Group? – Acceptable but not required

* Not equal to VEVRAA data


Self-ID Forms (Disability):

• Pre-Offer: EEOC approved. Template will be provided

(Subpart C)

• Post-Offer: Must invite current employees to identify

and update every five (5) years with one reminder in-

between

• Employers can identify a disability if it is “obvious” or if

an accommodation request is made (no guessing)


Self ID Forms (Veterans)

Pre-Offer – Solicitation of “Protected Veteran” only

Post-Offer – Solicitation of specific category

Timing of Pre-Offer – Follows Internet Applicant Rule


EO Clause:

Must be incorporated into contracts and subcontracts.

Required Text:

This contractor and subcontractor shall abide by the requirements of 41

CFR 60-741.5(a). This regulation prohibits discrimination against

qualified individuals on the basis of disability, and requires affirmative

action by covered prime contractors and subcontractors to employ and

advance in employment qualified individuals with disabilities.

This contractor and subcontractor shall abide by the requirements of 41

CFR 60-300.5(a). This regulation prohibits discrimination against

qualified protected veterans, and requires affirmative action by covered

prime contractors and subcontractors to employ and advance in

employment qualified protected veterans.

New Federal Contract Compliance Manual

New FCCM: What is the FCCM?

Contractors should not use more than one method so

as to mask underutilization.

Follows Uniform Guidelines

End of the 80% and Whole Person era?

Do you use two utilization tests?

Establishes IRA <80% as threshold for adverse impact

Internal audits becoming more important

Frito-Lay case ongoing

In order to fully investigate and understand the scope of

potential violations the CO may need to examine information

after the date of the Scheduling Letter in order to determine,

for example, if violations are continuing or have been

remedied. If the CO believes it necessary to request

information related to periods after the date of the scheduling

letter the CO must discuss the issue with his or her supervisors.



Nothing in the FCCM itself appears to specify timeliness apart from deadlines actually contained in regulations

Nothing authorizes OFCCP to impose arbitrary deadlines for responses to requests for information

“Prompt” responses expected without definition of prompt

Example: Request that contractor submit missing support data “promptly”

5-day initial conciliation contact deadline in Notices of Violations

FCCM provides that “The CO must provide the contractor with written confirmation of the onsite date(s) and time(s) at least three business days prior to the onsite.”

Status of Compensation Enforcement:

1990’s – Dubray Analyses

2000’s – Statistical Analyses

2006 – Failed Guidelines

2009 – Pay Equity Task Force

2013 – Directive 307

Compensation Enforcement


Directive 307:

Summary of OFCCP Compensation Investigation Procedures

Below are procedures that the CO follows in reviewing contractor compensation data and information. It is important to note that the order in which these procedures occur may vary based on the facts and circumstances of each review. At any stage in the process, OFCCP may determine, based on the evidence, that it is appropriate to close the review or may determine that further review is warranted.

1. Conducts Preliminary Analysis of Summary Data (if necessary or appropriate)

2. Conducts an Analysis of Individual Employee-Level Data

3. Determines the Approach from a Range of Investigative and Analytical Tools

4. Considers All Employment Practices that May Lead to Compensation Disparities

5. Develops Pay Analysis Groups

6. Investigates Systemic, Small Group and Individual Discrimination

7. Reviews and Tests Factors before Accepting the Factors for Analysis

8. Conducts Onsite Investigation, Offsite Analysis, and Refinement of the Model

Contractors have an opportunity to provide clarification of their submissions and to explain their compensation system and practices.

OFCCP Audits:

The basics (what we see in typical requests):

Emp ID, race, gender, title, hire date, job group, job change date, exempt/non-exempt, annual salary, etc.

The additional variables (other items seen):

Education, bonuses, commissions, overtime, shifts, performance scores, etc. (less reliable)

On the table (where we may be going):

Starting salary, job placement, progression

Try to avoid giving OFCCP junk data


Record Keeping and Adverse Impact

Is this still a critical item?

Common record keeping issues

How to minimize exposure/risk

What is the right analysis?

What to expect in an audit

Audit Preparation

Standard submission issues

Expected follow-up questions

Driving the process

Communicating with OFCCP

Thank you for joining us!

Questions and Answers

Chris and Patrick (504) 486-2410 * [email protected] * [email protected]

www.outsolve-hr.com * www.affirmativeactioneducation.com

mailto:[email protected]






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50 shades of grey the complexities of ofccp compliance in 2013

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