January 21, 2015

OFCCP FORECAST FOR 2015

DCI predicts that the OFCCP will continue to stay busy in 2015.  Here are the top stories and trends we expect to see this year from the agency.

1.) Sex Discrimination Guidelines
2.) Construction Regulations
3.) Equal Pay Report
4.) VETS 4212
5.) 503/VEVRAA Implementation
6.) Steering
7.) Itemized Listing
8.) FAQs (LGBT and More)
9.) EEO is the Law Poster

Sex Discrimination Guidelines

In November 2014, the OFCCP sent a Notice of Proposed Rulemaking to the OMB for review and approval on the revised Sex Discrimination Guidelines.  We should expect to see the proposed rule for public notice and comment in early-mid 2015.  As soon as the NPRM is released from OMB and made public, DCI will notify contractors immediately.

Construction Regulations

The OFCCP mentioned revising the construction regulations in the FY 2015 Congressional Budget Justification. It is anticipated that an NPRM will be issued in FY 2015 addressing the affirmative action plan requirements for federal and federally assisted construction contractors and subcontractors. DCI will keep the contractor community updated on any developments from the OFCCP.

Equal Pay Report

Following the August 8, 2014 publication of the NPRM for a new Equal Pay Report, a public comment period was open through January 5, 2015 (extended from the original November 6, 2014 deadline). In brief, the proposed rule suggests that the OFCCP will annually collect summary W-2 compensation data from contractors, utilizing the data to determine an industry standard for identifying potential discrimination. Publication of the finalized rule is anticipated in late August 2015. Based on prior implementation timeframes for new regulatory data obligations and given the need for systems updates, it can be reasonably expected that the first equal pay reporting requirement under the new regulation would not occur until the start of 2017.

VETS 4212

As we reported in a prior blog, the Veterans’ Employment and Training Service (VETS) of the U.S. Department of Labor issued a final rule in September 2014 updating the reporting requirements for federal contractors under the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA). While the rule became effective on October 27, 2014, contractors will actually see the impact of these changes in 2015.

The primary change will be that VETS-100 and VETS-100A reporting will be replaced with the VETS-4212. In what we anticipate will be a welcome change to most contractors, the VETS-4212 requires that contractors will report protected veterans in the aggregate rather than by protected veteran category. This should ease the administrative burden of completing the report as well as provide more meaningful and practical data to VETS.

As we announced this morning, the OFCCP has released two FAQs related to the self-identification requirements under VEVRAA. Because VEVRAA requires contractors to invite applicants at the post-offer stage to self-identify whether “he or she belongs to one or more of the specific categories of protected veteran for which the contractor is required to report pursuant to 41 CFR Part 61-300” (VETS-4212), contractors are now only required to solicit whether those offered a job wish to identify as a protected veteran, regardless of category. However, the FAQs do clarify that contractors may continue to solicit information regarding the four categories of protected veteran if they wish to continue doing so, as long as they are reporting this information in the aggregate on the VETS-4212.

While there is no requirement to collect and maintain data on specific protected veteran categories, contractors may wish to do so to help identify disabled veterans who may require an accommodation, as well as to more easily identify when “recently separated” veterans are no longer a member of this protected category.

503/VEVRAA Implementation

This year will see the full implementation of the revised Section 503 and VEVRAA regulations covering individuals with a disability and protected veterans, respectively.  In addition to the changes that were effective as of March 2014, the remainder of the 503/VEVRAA provisions must be implemented as of each contractor’s next affirmative action date.  The following are some big picture NEW requirements that are being implemented for many January AAPs right now:

  • Voluntary self-identification of applicant disability (using the OFCCP form) and protected veteran status, both pre- and post-offer,
  • Voluntary self-identification of employee disability sometime during the plan year,
  • New external policy dissemination requirements,
  • EEO/AA policy statement changes,
  • Implementation of procedures to track outreach and recruitment efforts to assist with required annual evaluation requirements (if not already in place),
  • Formally documenting audit and reporting activities, and
  • Tracking data points for the “44k” analytics, including the number of job openings, jobs filled, total applicants and hires, as well as counts of disabled and protected veteran applicants and hires.

Please note that the new itemized listing requires contractors to submit documentation on some of these new requirements in addition to some of the existing 503/VEVRAA requirements. Contractors should verify these pieces are in place and up to date before an audit occurs.

Steering

The uptick in Steering allegations by the OFCCP in 2014 stimulated many DCI blog posts on the subject, multiple ILG conference discussions, and too many client conversations to count. And that is not going to change in 2015. The fact is, steering cases are low-hanging fruit for the OFCCP, and the fact pattern in steering cases is often very similar to the most common failure-to-hire settlements: placement into low-skilled, high applicant volume jobs using an unstructured, unstandardized system that is not evidently job-related. Thus, we expect steering allegations to increase in 2015 and encourage our clients to take stock of their selection and placement processes. In particular, we suggest that our clients audit their selection and placement systems (especially for lower level jobs) to ensure that they have appropriate standardization and validation evidence in place to defend against OFCCP steering claims.

Itemized Listing

For 2015 audit activity, be prepared to produce a lot more data at the desk audit stage, and endure a longer audit process. As we mentioned in a previous blog, the newly released scheduling letter and itemized listing revealed twenty-two requirements, compared to the eleven item listing that was previously used. In addition, enhanced data submission requirements were introduced for 503 (Items 7 – 10), VEVRAA (Items 11 – 14) and compensation (Item 19).

Although our December blog included information on the 503 and VEVRAA partial year request, we do want to note that this may not affect federal contractors who are now entering their transitional AAP year. So if you have a January or February 2015 plan date, and are now implementing subpart C, you would not be in the position to comply with this request. However, you should be prepared to produce your organization’s implementation plan.

For a quick comp review, please read our “compensation guidance summary” released in November.

FAQs (LGBT and More)

In an effort to help contractors navigate the sea of changes brought about in 2014, the OFCCP released a number of new FAQs near the end of the year. Several topics covered in the new FAQs included submission of partial year and compensation data under the new scheduling letter, options for storing self-identified disability data,  and defining employer-employee relationships for AAP purposes. DCI predicts that the OFCCP will continue to issue new FAQs throughout 2015 to address questions from contractors as they work to translate written requirements into tangible strategies for implementation. One topic that DCI expects to see covered in upcoming FAQs is guidance on implementing the new LGBT regulations. The final rule, which adds “sexual orientation” and “gender identity” as protected classes under Executive Order 11246, was published in the Federal Register on December 5, 2014. Although the rule states that data collection/analysis will not be required on the basis of sexual orientation or gender identity, contractors should be on the lookout for FAQs outlining the required changes for LGBT under the new rule.

EEO is the Law Poster

During the 2014 NILG conference, Debra Carr, the OFCCP’s Director of the Division of Policy and Program Development stated that the agency will be coordinating with the EEOC to update the EEO is the Law poster.  The updates are necessary to reflect the new regulatory landscape, including the new LGBT regulations.  However, no timeline has been put forth for this change as of yet.

By Joanna Colosimo, Senior Consultant; Keli Wilson, M.A., Senior Consultant; Jana Garman, M.A., Consultant; Dave Sharrer, M.S., Consultant; Kristen Pryor, M.S., Associate Consultant; Kayo Sady, Ph.D, Senior Consultant; Yesenia Avila, HR Analyst; Yevonessa Hall, M.P.S., Consultant; Rachel Gabbard, M.A., HR Analyst; and Eric Dunleavy, Ph.D., Principal Consultant, DCI Consulting Group 

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