OFCCP Update Roundup

In a flurry of activity leading up to the change in administration, OFCCP issued several documents that might be of interest to contractors and other movement impacting the contractor community over the past weeks. We provide a brief overview of these updates below:

OFCCP issues proposed revised construction audit letter

In late December, OFCCP published a proposed revision to the construction audit scheduling letter. The proposed letter is quite expansive, with 34 individual requests for reports or data. This is a much larger request for construction audits as the wording the letter has changed from “examples of” to “all” records available on a given item. Some of the requests include:

• A list of all construction projects for the prior 12 months from date of receipt of the letter
• Employee level payroll data for the preceding 12 months
• Personnel activity in the form of applicants, hires, promotions, layoffs, recalls, and separations
• A list of all Federally assisted subcontracts issued in the past 12 months
• Documentation of EEO Policy, notices to subs, targeted outreach sources and unions, management notifications and internal training programs
• The most recently filed Type 2 (Consolidated) EEO-1 report for the company
• Reasonable accommodation policies and any requests related to pregnancy, medical conditions, or religious observances.
• Copies of the Section 503 and VEVRAA AAPs and several documents included in the plans
• Targeted outreach for IWDs and PVs, and an update if the plan is more than 6 months old
• Reasonable accommodation policies and any requests related to IWD or PV status.

Because most data elements are calculated by the date of receipt of the letter, it is nearly impossible for construction contractors to develop and maintain a compliant submission package proactively. The public comment period is open until February 22, 2021. The notice, proposed letter, and link to file comments is available here.

OFCCP issues Ombuds Annual Report

OFCCP established the office of the Ombuds Service in 2018, as a means of providing another channel of communication with the contractor community. Under the direction of Marcus Stergio, the office issued an Annual Service Report which details the following:

• The Ombuds office successfully closed 178 referrals in fiscal 2020
• Detailed information about the types of referrals, including communication, length of investigations, consistency across offices, and “other” concerns
• A review of all issues raised to the office and a trend analysis
• Positive comments received from the contractor community
• Offers to attend contractor meetings and other plans for fiscal 2021

OFCCP releases Religious Exemption Opinion Letter

Taking a tool from the EEOC toolbox, OFCCP issued an opinion letter regarding six scenarios of potential individual religious discrimination. Previously, OFCCP released guidance and FAQs on employer rights under the religious exemption that was put into place by OFCCP Directive in 2018. In this letter, the agency reaffirms the contractor’s requirement to reasonably accommodate religious requests and responds to some scenarios in which employee rights could be violated. Contractors are required to make reasonable accommodations for employees’ religious beliefs unless they are exempted from doing so as a religious organization. The agency reaffirms that discrimination on the basis of religious beliefs (or no religious belief) is prohibited and responds that in each of the six scenarios, a potential violation has occurred. This issue may be the subject of future litigation to determine where employee rights begin and employer rights end, and if there is any overlap. Stay tuned for further updates.

OFCCP Signals New AA Program Focused Review

In a somewhat unexpected move, the agency created a new web page for an AA Focused review. On the page, which is populated with links to existing information currently, the agency indicates they plan to conduct this this type of review in lieu of the existing compliance check – the “quick and easy” reviews that request three items and can be completed in about a week. According to the agency, the AAP Focused Review will have a focus on the contractor’s efforts to interact with minority focused colleges and universities and with OFCCP’s Indian and Native American Employment Rights Program. The agency indicated additional resources in the form of an AAP Focused Review on-site review guide, scheduling letter, and frequently asked questions are forthcoming. It is unclear if or when the agency will submit a revision to the existing establishment review letter to be used in this focused review.

OFCCP Issues Section 503 Focused Review Annual Report and holds stakeholder conference call

OFCCP released an annual report on the Section 503 Focused Review program and held a call to review the report. Director Leen ran the call and used the time to review the document with participants and reinforce OFCCP’s commitment to emphasizing disability compliance, with a vision of full inclusion of IWDs in the workforce. Director Leen acknowledged the work of the National Policy team and District and Regional offices and expressed thanks to the contractor community for their partnership during his term. He also expressed hope that the important work the agency advanced in the past four years will continue under the new administration.

The report acknowledges the assistance and partnership of the Office of Disability Employment Policy and that agency was highlighted as a resource for contractors. Leen then discussed the streamlined IWD form and indicated the agency made the changes to be more user friendly and accessible in the hopes that the changes would lead to more employees being comfortable to self-identify as an IWD.

Leen then outlined a vision of the accommodation process as warm and welcoming and not legalistic – which he indicates can be accomplished through messaging from the CEO and HR department. The agency encourages employers to partner with internal stakeholder groups and to focus on mental health issues in light of recent workforce challenges. With the goal of increasing the IWD labor force participation rate, he encouraged companies to be aware of and inclusive of neurodiversity and to adopt disability inclusion programs and other best practices outlined on OFCCP’s website. He indicated, “Not only is it the legal thing to do, it is the right thing to do.”

Leen provided background as to how these focused reviews came about, by reviewing when he began at the agency, audits were primarily focused on hiring and compensation discrimination for race and gender. Leen indicated these and other focused reviews were a way of broadening the scope of audits and highlighted transparency efforts in the form of web pages, best practices, compliance assistance meetings, and other guidance including the Standard Compliance Evaluation Report (SCER).

Leen encouraged contractors to complete a self-audit using the annual report and the SCER, and reviewed the top 5 violations the agency found in these focused reviews on page 11 of the report. Leen stated, “By being a Federal Contractor there is a good faith obligation to meet the 7% goal. It’s been 6 years and if companies are not reaching the goal, that’s a problem.”

Broadly, the agency will be looking for self-audits in compensation, hiring, and outreach to protected classes. Leen indicated contractors are “wise” to revisit this requirement and ensure any issues found in the audit are proactively addressed. He mentioned AAP verification is on the horizon and signaled it will be implemented in the new administration because there is strong bipartisan support for that initiative.

Leen closed the call by mentioning best practices contractors should consider. First, he recommended centralizing the disability request process to ensure requests are treated the same and are handled by experts with knowledge of the requirements. Second, he indicated any cost of accommodations should be spread across the company. Third, he recommended contractors coordinate with OFCCP and state/local rehabilitation agencies, offer more telework, and consider adding a Chief Accessibility Officer position. Leen indicated if Artificial Intelligence is used in hiring practices, it should be monitored for adverse impact against IWDs or any protected class. He closed on a positive note by encouraging contractors to build an inclusive environment in organizations and indicated OFCCP might award certificate of merit for contractors where the 7% goal is met in over half of the job groups in the plan.

More information on 503 focused reviews is available here.