This article originally appeared in the April 2013 edition of the LocalJobNetwork "OFCCP Digest."
Much has been written about the U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) in the last few years. OFCCP has a number of significant new initiatives, most notably its recent directive regarding the evaluation of compensation data that federal contractors and subcontractors will be asked to provide during compliance reviews. OFCCP has also gone through a number of changes to the manner in which it conducts compliance reviews. For example, the agency was routinely conducting on-site investigations for a while, but OFCCP is now limiting its on-site presence and is instead requesting many additional documents during the course of a compliance review.
While we know a great deal about what OFCCP is doing, a rarely asked question is this: what does OFCCP want? Phrased somewhat differently, what are OFCCP’s expectations of federal contractors and subcontractors? And, what kind of expectations does the federal government in turn have for OFCCP?
Saturday, April 27, 2013
OFCCP Scheduling Process Aimed at Larger Organizations?
The most recent release of pre-scheduling notices by OFCCP seems to be following certain patterns that were evident in the pre-scheduling notices sent out by OFCCP in late 2012. It appears both from experience with our clients and from discussions we've had with others that OFCCP is targeting larger organizations. These larger organizations are receiving a disproportionate number of pre-scheduling notices. John Fox of Fox, Wang & Morgan has also reported that OFCCP is disproportionately selecting certain industries for review, including the healthcare and manufacturing sectors.
The fact that OFCCP is targeting certain types of companies and certain industries negates the long-standing idea that OFCCP uses a neutral, unbiased tool to select federal contractors and subcontractors for review. OFCCP's decision to conduct multiple reviews at the sites of larger federal contractors and subcontractors appears to be part of the agency's desire to conduct corporate-wide reviews of certain companies. While it is unclear whether OFCCP has the right to conduct such corporate-wide reviews, the agency seems to be making adjustments to its scheduling process that are allowing OFCCP to get a broader picture of what happens in certain larger organizations.
The current tool used to select companies for review, the Federal Contractor Selection System (FCSS), uses data from EEO-1 reports, history of compliance reviews, number of discrimination complaints, and various other factors to help OFCCP determine which companies to review. Some of the factors used by the FCSS and how these factors are weighted is a closely-guarded secret. While OFCCP states on its website that the FCSS is a "neutral system," the agency's reviews during federal fiscal year 2013 (which started in October of 2012) appear to be anything but random.
The fact that OFCCP is targeting certain types of companies and certain industries negates the long-standing idea that OFCCP uses a neutral, unbiased tool to select federal contractors and subcontractors for review. OFCCP's decision to conduct multiple reviews at the sites of larger federal contractors and subcontractors appears to be part of the agency's desire to conduct corporate-wide reviews of certain companies. While it is unclear whether OFCCP has the right to conduct such corporate-wide reviews, the agency seems to be making adjustments to its scheduling process that are allowing OFCCP to get a broader picture of what happens in certain larger organizations.
The current tool used to select companies for review, the Federal Contractor Selection System (FCSS), uses data from EEO-1 reports, history of compliance reviews, number of discrimination complaints, and various other factors to help OFCCP determine which companies to review. Some of the factors used by the FCSS and how these factors are weighted is a closely-guarded secret. While OFCCP states on its website that the FCSS is a "neutral system," the agency's reviews during federal fiscal year 2013 (which started in October of 2012) appear to be anything but random.
OMB Head Confirmed; Labor Secretary Confirmation on Hold
Confirmation hearings for two people who may have a significant effect on OFCCP went in significantly different directions this week. While the new head of the Office of Management and Budget (OMB) was confirmed on a unanimous vote of the Senate on Wednesday, April 24, a committee vote on the confirmation of President Obama's nominee to be Secretary of Labor was put on hold until at least May 8.
Sylvia Mathews Burwell was confirmed to head OMB on a 96 to 0 vote in the Senate. Ms. Burwell previously served as deputy budget director at OMB during the Clinton administration. Ms. Burwell will have a significant number of items on her plate as she begins her tenure at OMB, including oversight for recent budget proposals by the White House and management of various regulatory initiatives by federal agencies. Ms. Burwell's selection is important in the OFCCP context because OFCCP has a number of proposed regulations, including its massive proposed changes to the regulations concerning veterans and persons with disabilities, that are awaiting approval by OMB.
More important to OFCCP is the continuing absence of a Secretary of Labor. Thomas Perez, who is President Obama's choice to fill the role of the departed Hilda Solis, has run into opposition from Republican members of the Senate. Perez's nomination was supposed to go before the full Senate by the end of April, but instead the Senate's Health, Education, Labor and Pensions Committee scheduled another day of hearings on May 8. While Perez appears to still have the support of the President, it is not clear when or if his nomination will receive a full vote by the Senate.
The absence of a Secretary of Labor is important in a number of ways to OFCCP. First, the agency may be reluctant to move forward a number of major initiatives until there is someone leading the Department of Labor who can approve these initiatives. Second, a new Secretary of Labor, whether it is Thomas Perez or someone else, may have different ideas about where OFCCP should focus its attention. It is even possible that a new Secretary of Labor may decide that there should be a new leader at OFCCP.
(Information for this post was taken in part from various news reports available on the web at sites like Politico and the Huffington Post.)
Sylvia Mathews Burwell was confirmed to head OMB on a 96 to 0 vote in the Senate. Ms. Burwell previously served as deputy budget director at OMB during the Clinton administration. Ms. Burwell will have a significant number of items on her plate as she begins her tenure at OMB, including oversight for recent budget proposals by the White House and management of various regulatory initiatives by federal agencies. Ms. Burwell's selection is important in the OFCCP context because OFCCP has a number of proposed regulations, including its massive proposed changes to the regulations concerning veterans and persons with disabilities, that are awaiting approval by OMB.
More important to OFCCP is the continuing absence of a Secretary of Labor. Thomas Perez, who is President Obama's choice to fill the role of the departed Hilda Solis, has run into opposition from Republican members of the Senate. Perez's nomination was supposed to go before the full Senate by the end of April, but instead the Senate's Health, Education, Labor and Pensions Committee scheduled another day of hearings on May 8. While Perez appears to still have the support of the President, it is not clear when or if his nomination will receive a full vote by the Senate.
The absence of a Secretary of Labor is important in a number of ways to OFCCP. First, the agency may be reluctant to move forward a number of major initiatives until there is someone leading the Department of Labor who can approve these initiatives. Second, a new Secretary of Labor, whether it is Thomas Perez or someone else, may have different ideas about where OFCCP should focus its attention. It is even possible that a new Secretary of Labor may decide that there should be a new leader at OFCCP.
(Information for this post was taken in part from various news reports available on the web at sites like Politico and the Huffington Post.)
Sunday, April 7, 2013
Scheduling Letters Associated with Pre-Scheduling Notices Begin to Appear
Well, that didn't take long.
Some of the facilities that received pre-scheduling notices from OFCCP during the first week in April have already received the letter that formally opens an OFCCP review. While the pre-scheduling notices were supposed to give companies time to prepare for a review, OFCCP appears to be moving forward aggressively with this round of compliance reviews. (We are even aware of one situation where a company received the letter opening its compliance review BEFORE the company received its pre-scheduling notice.)
This letter that opens a review, referred to as a scheduling letter, and the itemized listing that accompanies the scheduling letter are the same as they've been for some time. OFCCP's revised scheduling letter and itemized listing that were first published in May of 2011 are still on hold at the Office of Management and Budget. (You can find a copy of the revised scheduling letter and itemized listing that OFCCP proposes to use on the documents page of our website.)
We expect that companies receiving this round of scheduling letters will be asked to provide extensive compensation data during their compliance reviews. This round of reviews will be the first under OFCCP's new Directive 307, the directive that instructs OFCCP compliance officers to give expanded attention to the compensation data and practices of federal contractors and subcontractors. It will be interesting to see how OFCCP implements this directive and what other priorities OFCCP has for federal contractors and subcontractors in this round of reviews.
Some of the facilities that received pre-scheduling notices from OFCCP during the first week in April have already received the letter that formally opens an OFCCP review. While the pre-scheduling notices were supposed to give companies time to prepare for a review, OFCCP appears to be moving forward aggressively with this round of compliance reviews. (We are even aware of one situation where a company received the letter opening its compliance review BEFORE the company received its pre-scheduling notice.)
This letter that opens a review, referred to as a scheduling letter, and the itemized listing that accompanies the scheduling letter are the same as they've been for some time. OFCCP's revised scheduling letter and itemized listing that were first published in May of 2011 are still on hold at the Office of Management and Budget. (You can find a copy of the revised scheduling letter and itemized listing that OFCCP proposes to use on the documents page of our website.)
We expect that companies receiving this round of scheduling letters will be asked to provide extensive compensation data during their compliance reviews. This round of reviews will be the first under OFCCP's new Directive 307, the directive that instructs OFCCP compliance officers to give expanded attention to the compensation data and practices of federal contractors and subcontractors. It will be interesting to see how OFCCP implements this directive and what other priorities OFCCP has for federal contractors and subcontractors in this round of reviews.
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