OFCCP’s Proposed Scheduling Letters Would Impose Significant Additional Obligations On Federal Contractors

By now, most federal contractors are aware of the Office of Federal Contract Compliance Programs’ (OFCCP) current policy of transparency and have heard about its plan to conduct focused reviews and other compliance checks, in addition to regular establishment reviews. Likewise, most have already perused the latest Corporate Scheduling Announcement List (CSAL) notifying contractors about whether they are likely to be scheduled for review during the current fiscal year and, if so, providing advance notice regarding the type of review to be conducted.

However, with all of the attention on the OFCCP’s new processes and the upcoming reviews, the OFCCP’s recent proposals regarding the information to be obtained during its establishment reviews, focused reviews, and compliance checks have, to a large extent, gone unnoticed. Because the OFCCP’s recently proposed scheduling letters seek new and different information beyond that historically requested, contractors are advised to familiarize themselves with the details of the proposed letters. To that end, summaries of the proposed changes for each type of OFCCP review are set forth below.

OFCCP’s Proposed Establishment Review Scheduling Letter

• New: The OFCCP’s proposed scheduling letter for establishment reviews requires contractors to provide a list of their three largest subcontractors based on contract value, excluding those expiring within six months of the contractor’s receipt of the scheduling letter. Contractors are further directed to identify “only subcontractors that perform work or provide supplies or services necessary to the performance of the federal contract, and those subcontractors who perform, undertake, or assume any portion of the contractor’s obligation.”
• New: In addition to providing the standard information about placement goals for women and minorities, the OFCCP’s proposed itemized listing for establishment reviews requires contractors to provide availability and utilization data by race/ethnicity in order to “determine whether there were substantial disparities in the utilization of any one particular minority group or the utilization of men or women of any one particular minority group, such that separate goals for these groups may be necessary.” Contractors would also be required to provide personnel activity data – regarding hires, promotions, and terminations – by race/ethnicity as well.
• New: In addition to the individualized compensation data that has historically been requested, the OFCCP’s proposed itemized listing asks contractors to provide the “[r]esults of the most recent analysis of the compensation system(s) to determine whether there are gender-, race-, or ethnicity-based disparities” (emphasis added). Because many contractors currently conduct their compensation analyses under privilege, this requirement would be a particularly significant additional obligation for contractors.
• New: The OFCCP’s proposed itemized listing also requires contractors who receive a scheduling letter on a date that is more than six months into their affirmative action plan year to provide information regarding personnel activity for “every completed month of the current AAP year,” not just for the first six months of the year as previously required. Additionally, such contractors would also be required to submit monthly data regarding the representation of individuals with disabilities and protected veterans for every completed month of the AAP year. They would also be required to provide updated information regarding progress toward goals during the current AAP year and to describe implementation of any action-oriented programs designed to achieve those goals.
• New: The OFCCP’s proposed itemized listing requires contractors to provide copies of policy statements, employee notices or handbooks, or other documents that “implement, explain, or elaborate on the provisions of” any collective bargaining agreement, in addition to providing the actual collective bargaining agreement(s).
• New: The OFCCP’s proposed itemized listing requests that contractors “provide the pool of candidates from which the promotions were selected by gender and by race/ethnicity,” and include the definition of “promotion” as used by the contractor, in addition to providing the usual data regarding the number of promotions by gender and race/ethnicity.
• New: The proposed itemized listing also requires contractors to distinguish between voluntary and involuntary terminations when providing termination data.
• New: Finally, the proposed itemized listing requires contractors to provide copies of their reasonable accommodation policies, documentation regarding accommodation requests received by the contractors and any responses, documentation regarding the most recent assessment of personnel processes, and documentation regarding the most recent assessment of the physical and mental job qualifications as part of the initial data requested as part of the review.

Proposed Section 503 and VEVRAA Focused Review Scheduling Letters

• New: The OFCCP’s proposed focused review scheduling letters require contractors to provide a copy of their current Executive Order 11246 affirmative action plan for women and minorities, in addition to the Section 503 affirmative action plan for individuals with disabilities or VEVRAA affirmative action plan for protected veterans in order “to help the OFCCP understand the contractor’s organizational structure, confirm . . . job groups, and understand generally how the Section 503 [or VEVRAA] compliance strategies fit with the contractor’s other affirmative action efforts.”
• New: The proposed focused review scheduling letters request individualized compensation data for all employees. The type of data requested is the same as that historically requested as part of a full establishment review and is an indicator that the OFCCP intends to analyze compensation data by veteran and disability status, despite the fact that only small percentages of employees in a contractor’s work force are likely to self-identify as individuals with disabilities or protected veterans.
• New: The proposed focused review scheduling letters also require contractors to provide applicant- and employee-level data related to hiring, promotions, and terminations by veteran and disability status and to provide the pool of candidates from which promotions were made and to provide the contractor’s definition of “promotion.” Like the proposed establishment review letter, the OFCCP’s proposed focused review scheduling letters also require contractors who receive a scheduling letter on a date that is more than six months into their affirmative action plan year to submit monthly data regarding personnel activity and the representation of individuals with disabilities and protected veterans for every completed month of the AAP year.
• Note: Like the proposed establishment review scheduling letter, the proposed focused review letter requires contractors to provide copies of their collective bargaining agreement(s), policy statements, employee notices or handbooks, or other documents that “implement, explain, or elaborate on the provisions of” any collective bargaining agreement, copies of their reasonable accommodation policies, documentation regarding accommodation requests received and any responses, documentation regarding the most recent assessment of personnel processes, and documentation regarding the most recent assessment of the physical and mental job qualifications as part of the initial data requested as part of the focused review.

Proposed Compliance Check Scheduling Letter

• New: The OFCCP’s proposed compliance check scheduling letter requires contractors to provide copies of their “[w]ritten AAPs prepared in accordance with Executive Order 11246, Section 503, and VEVRAA,” rather than simply providing the “AAP results for the preceding year.”
• New: The proposed compliance check scheduling letter requires submission of “[r]equests made for accommodations by persons with disabilities, whether the requests were denied or granted,” rather than merely requesting examples of disability accommodations provided by the contractor.

While the OFCCP’s proposed scheduling letters are not yet approved or effective, contractors should carefully review each of them and take advantage of the present opportunity to provide comments to the Office of Management and Budget regarding the likely burden of, and any objections to, or comments regarding such proposals prior to the June 11, 2019, comment deadline.