Having shaken the prospect of a merger with EEOC, and facing a smaller budget, the OFCCP offers a glimpse into its priorities and invites contractors to suggest changes.

Takeaways

  • Compliance letters have been sent out and audits will continue at the same pace in FY 2018; notified contractors should be prepared.  
  • Contractors providing hurricane relief should review the NIE specific to their location for available extensions or exemptions, and the specific wording of FAR 52.222-26 and 52.222-35.  
  • Contractors unable to attend to one of the three town halls may still submit recommendations and ideas via the OFCCP website.  

The Office of Federal Contract Compliance Programs (OFCCP) is reaching out to proactively communicate with Government contractors about their experiences in complying with the laws OFCCP enforces. By its own admission, OFCCP relies heavily on voluntary compliance from contractors; however many businesses would characterize the previous administration as one marked more by enforcement and confrontational reviews than by partnering and voluntary compliance assistance.

Evidence of this frustration can be found in the U.S. Chamber of Commerce’s report issued on September 21, 2017, which sharply criticizes the agency and urges OFCCP to return to a more neutral enforcement agency that encourages government and contractor partnering, to revise regulatory guidance documents, to increase consistency in the enforcement approach at individual regional and district offices; and examine ways to help small businesses comply with the laws without the current extensive regulatory burdens. (The Chamber’s report, “Right Mission, Wrong Tactics,” can be found here.)

Acting Interim Director Thomas Dowd touted the agency’s commitment towards better transparency and communication. At the San Francisco town hall on September 26, 2017, he noted that OFCCP is focused on working with contractors to ensure contractors comply with laws voluntarily, and on resolving issues short of litigation. He noted that fewer than one tenth of one percent of audits result in litigation, and fewer than two percent of all compliance reviews find evidence of actual discrimination, indicating that contractors in general are doing well in compliance. On the other hand, he also noted that 15 percent of reviews end in conciliation agreements involving technical, administrative or record keeping non-compliances, and that a full 80 percent of contractors do not submit required Affirmative Action Plans on time following the initial OFCCP audit request, reflecting that there is work yet to be done by the contractor community.

Ideas raised at the town hall focused largely on training, webinars and improved guidance from OFCCP as to best practices and agency expectations. Reforms regarding applicant tracking were frequently mentioned, and some participants expressed a desire to have OFCCP shift back to more positive forms of reinforcement, such as re-implementing the EVE (Exemplary Voluntary Efforts) award, which was rescinded in 2013. Director Dowd suggested that contractors who voluntarily complete a 2-3 day OFCCP training course might be exempt from any compliance review for a two-year period following the training.

OFCCP already has begun redesigning compliance assistance resources to include FAQs, fact sheets and webinars in order to assist contractors’ compliance with applicable laws.

While it is unknown what will come of this week’s numerous suggestions, prior OFCCP town hall meetings have yielded substantive policy changes. Calendar year 2010 town halls led to updates to affirmative action and nondiscrimination rules for covered veterans and individuals with disabilities. The 2011 town halls solicited feedback on contractor pay data collection processes, leading to the revised EEO-1 report collected by the Equal Employment Opportunity Commission. However, criticism of that form has resulted in delayed implementation, as OMB issued a stay on the effective date of the revised EEO-1 form, putting its future in limbo. The revised form was to have been submitted by all covered federal contractors on March 31, 2018, but has recently been suspended. As of August 31, 2017 Contractors will not have to submit the revised form in 2018.

The White House’s recent Regulatory Agenda for DOL contained absolutely no regulatory agenda for OFCCP, indicating the agency is in a transitional period, at best. While there has been speculation about an EEOC-OFCCP merger, the concept was essentially dead on arrival before the town halls, based on House and Senate opposition. The issue was not even mentioned in passing at the town hall meeting.

In other news, OFCCP has issued National Interest Exemption (NIE) Memoranda to Federal contracting agencies in response to Hurricanes Harvey and Irma. The NIEs apply to new supply & service and construction contracts entered into between September 1, 2017, and December 1, 2017, specifically to provide Hurricane relief. Contractors should review the NIE specific to Harvey or Irma to ascertain the dates and scope of any available extensions to your business. Available exemptions include the waiver (for 90 days) of a requirement to develop written affirmative action programs under EO 11246 or VEVRAA. Further, OFCCP instituted a moratorium on scheduling new construction and supply & service (non–construction) compliance evaluations for a three–month period in the areas impacted by the Hurricanes.

OFCCP publishes significant data regarding its charges and recoveries. Based on recent data, OFCCP is on track to field over 730 complaints for FY 2017, a 6 percent increase over 2016. While employers in supplies and services fields end up with conciliation agreements or consent decrees in less than 20 percent of the OFCCP reviews, for the construction industry that number jumps to slightly over 50 percent. Despite signals that a more compliance based OFCCP may be in our future, contractors cannot relax when it comes to compliance with these programs.