September 24, 2011 will mark the 46th anniversary of Lyndon B. Johnson’s signing of Executive Order 11246, which requires employers that do business with the federal government, either directly or as a subcontractor, to undertake various affirmative action efforts.  The Office of Federal Contractor Compliance Programs (“OFCCP”) has been enforcing the mandates of Executive Order 11246 since 1978.

Over the past 33 years, the OFCCP has endeavored to increase its enforcement efforts—as well as the operational and recordkeeping burdens—on federal contractors.  These increased efforts hit the construction industry in 2009 after the passage of the American Recovery and Reinvestment Act of 2009 (“ARRA”).  Since then, the OFCCP has made special efforts annually to review a minimum of 360 construction contractors and 90 supply and service contractors (including at least 10 percent of first-time federal contractors) who received federal stimulus money.

In April 2011, the OFCCP announced its latest mission:  strengthening current regulations to require federal contractors to collect more data regarding the veteran status of employees and applicants and establishing hiring benchmarks to measure affirmative action efforts to recruit protected veterans.  The agency published proposed rules that would (1) require federal contractors to post job openings with various state agencies and veterans organizations; (2) increase communication efforts regarding affirmative action obligations; and (3) require the collection of data on contractors’ hiring, termination and promotion of veterans.  The OFCCP’s proposed rules would create dramatically increased burdens on all federal contractors.

On July 5, 2011, several employer groups—including the Associated General Contractors of America (“AGC”)—submitted a letter to the OFCCP urging the agency to withdraw its proposed rule.  The groups have argued that the proposal includes “burdensome administrative, recordkeeping, and paperwork requirements” that do not comply with Executive Order 13563, which requires federal agencies to use the “least burdensome tools for achieving regulatory ends.”  The groups have also asserted that the OFCCP’s estimate of the financial burden the proposed changes would have on federal contractors is dramatically low.  The AGC has alternatively asked that the rule be modified to exempt the construction industry from the new requirements.

Although the fate of the OFCCP’s proposed rule remains unclear, the publication of the rule is a reminder that employers should review whether they are a government contractor and, for those that are, make sure their affirmative action policies and programs are up to date.  Every employer should review whether it has any government contracts or subcontracts.  All too often those who administer the employer’s affirmative action obligations are the last to know that the employer has entered into a contract with a federal government agency or contractor.

The OFCCP’s funding and enthusiasm has increased under the current administration.  Employers that are subject to Executive Order 11246 need to take a proactive approach in response.  Some questions worth periodic review include:

  1. Does the employer have a contract with a federal government agency or one of its contractors for the purchase, sale, lease or use of personal property, including supplies and real property [??], or non personal services, including utilities, construction, transportation, research, insurance and fund depository?
  2. Have the contractor’s affirmative action programs been reviewed and updated for the year?  (Are there placement goals that need to be addressed?)
  3. Are managers aware of the results of the review and the contractor’s affirmative action obligations?
  4. Has the contractor reviewed and analyzed its hiring, promotion, termination, compensation and other employment actions for evidence of disparity or areas for improvement?  (Has it taken steps to protect the self analysis by utilizing the advice and assistance of counsel?)
  5. Has the contractor made recent outreach efforts to veterans’ organizations and rehabilitation or other agencies designed to assist the disabled?
  6. Have job openings been posted with the state workforce agency job bank?
  7. Are the contractor’s online application and recruitment tools accessible to individuals with visual, sensory, motor or other disabilities?
  8. Have employees been invited to self identify as veterans or disabled individuals?
  9. Is an equal opportunity clause and affirmative action notice included in subcontracts?
  10. Has the contractor filed its EEO 1 and Vets 100/100A forms?
  11. Have all relevant notices and specifications been included in solicitations for offers and bids on all federal and federally assisted construction contracts in excess of $10,000?
  12. Have all monthly utilization reports been timely filed?
  13. Has the contractor timely reported to the OFCCP area/field office the required information related to subcontracts that are awarded?

A pro-active self-assessment is a good first step to making sure your company is compliant with its affirmative action obligations.