OFCCP’s FY 2012 Proposed Budget Chat Recap and Analysis

The Office of Federal Contractor Compliance Programs (OFCCP) has released its 2012 proposed budget. The budget reflects a $3.6 million increase from FY 2010 - the OFCCP is currently working under a continuing resolution so there is no 2011 budget. The 2012 Congressional budget justification document is now available and can be accessed here. Director Patricia Shiu stated the OFCCP does not foresee any cuts to staff and will continue to increase their number of compliance evaluations. Based on their aggressive enforcement plan, they hope to hire additional compliance officers. Director Shiu did not foresee the budget approval process affecting the release dates of any OFCCP proposed regulations.

 

According to Director Shiu, the Notice of Proposed Rule Making on VEVRAA will be published soon. Director Shiu also stated the agency will continue to spend additional and significant time to enforce the civil rights of people with disabilities and protected Veterans who work for federal contractors. As part of the OFCCP's aggressive enforcement plan, the agency will continue to focus on investigating claims of discrimination on behalf of people with disabilities and protected Veterans. Although the 2012 budget does not specifically call for a concrete number of investigations, the OFCCP has incorporated these issues into every on-site investigation as part of its protocol.

 

The FY 2012 budget will be used to implement the “Plan, Prevent and Protect" initiative. Director Shiu stated part of the initiative ensures workers are accurately characterized as independent contractors as opposed to employees. A provision of the budget indicates inspectors will be dedicated to identifying times when an employee may be misclassified. In response to a question on the OFCCP’s program implementation strategy, Director Shiu responded the agency is reviewing the contents of the scheduling letter, alluding to the possible change of the scope of desk audits in the future.

 

The moratorium on FAAP approvals by the OFCCP, instituted last year, will soon be lifted. The FY 2012 budget includes a target of 50 completed FAAP reviews. In response to a question on whether these will be currently under review by compliance officers, or if the 50 includes new reviews, the Director said she anticipates completion of at least 50 FAAP reviews and hopefully this will include initiation of many new reviews. Director Shiu also urged the contractor community to not follow the former instructions to renew FAAP agreements. She said the new FAAP directive will be out shortly and will provide further guidance.

 

As explained in the Federal Register notice regarding the rescission of the compensation standards, the OFCCP will continue to follow Title VII principles in investigating and analyzing compensation discrimination. The OFCCP will develop and issue compensation investigation procedures through directives and other staff guidance materials.

 

As the budget process begins in Washington, there is a new season at the OFCCP. The focus has shifted from compliance assistance to enforcement, and contractors are well served to complete their AAPs and put proactive policies in place as Director Shiu’s leadership begins to take hold. If you have any questions about how this initiative affects your organization, please contact your Berkshire at 800.882.8904 or email bai@berkshireassociates.com.