OFCCP mailed letters last week to over 350 separate companies notifying them that they are on the agency’s “to be audited” list. Known as Corporate Scheduling Announcement Letters (“CSALs”), the letters are provided as a courtesy in the hope that the company will be better prepared for the compliance review. Importantly, the notices are addressed to the human resources director or manager at local establishments and not to the company’s corporate headquarters. OFCCP’s decision to mail the CSALs will be welcomed by the contractor community as this is a practice they have not followed for the past couple of years.
What You Should Do
The first thing you should do is notify your local human resources personnel to be on the lookout for a CSAL from OFCCP. Although a compliance review doesn’t technically begin until OFCCP sends the official scheduling letter, receipt of a CSAL is a good indication that the scheduling letter will follow.
Once it has been determined that your establishment received a CSAL, you should begin preparing for the compliance review immediately. This point cannot be overstated. Although OFCCP has not been conducting as many compliance reviews as in the past, they have never been more painful. The pain and—more importantly—the risk involved in an OFCCP compliance review can be drastically reduced by being prepared in advance. The CSAL provides this opportunity. Don’t waste it.
Should You Contest OFCCP’S Jurisdiction?
Receiving the CSAL in advance also gives you more time to consider whether your establishment has been appropriately selected for audit. OFCCP’s jurisdiction extends only to federal contractors and covered subcontractors. Whether a company is a federal contractor or covered subcontractor is not always easy to determine, especially in the health care industry where these definitions remain murky.
Whether in the health care industry or not, if you don’t believe your company is a federal contractor or covered subcontractor, you will want to have your reasons and supporting arguments prepared in advance. You will also want to have carefully considered the pros and cons of contesting OFCCP’s jurisdiction as OFCCP typically won’t retreat easily. These are complicated questions and analyses that are best addressed with legal counsel experienced in OFCCP jurisdiction matters.