It is the Tuesday after a long holiday weekend, and you are faithfully going through the pile of mail on your desk when you spy an envelope from the United States Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP). You open the envelope and, sure enough, your facility has been selected for a compliance review under Executive Order 11246, the Vietnam Era Veterans’ Readjustment Assistance Act, and Section 503 of the Rehabilitation Act. Which of the following most accurately describes your response?
A. Hot dog! I finally get to do something with those affirmative action plans I have been patiently preparing for years!
B. Story of my life . . . any time I take a long weekend, I always return to bad news.
C. An OFCCP audit? Someone turn off the lights so I can curl up and cry in the corner.
Regardless of which response you chose, before you respond to the OFCCP, there are several things you should do to increase your chances of a successful audit outcome:
- Start early! You have 30 days from the date you receive the scheduling letter to respond to the OFCCP. Even if your affirmative action plans are already complete, it takes time to notify the appropriate internal and external personnel, compile the requested information, and complete the necessary pre-submission review.
- Review your affirmative action plans. Before you think about submitting information to the OFCCP, you should carefully review (or re-review) your company’s affirmative action plans (AAPs) to make sure they contain all of the required components, data, and language. This includes the many new components and additional data now required under the amended regulations governing affirmative action for protected veterans and individuals with disabilities,which went into effect last year. If you are not sure what must be included in your AAPs, consult your legal counsel or peruse the OFCCP’s sample plans (available here.) In addition, if you have not already done so, you should tailor the plan language to your company by removing any inapplicable boilerplate language and replacing it with content that is specific to your company.
- Reconcile the data used to prepare your AAPs. In addition to making sure that your plans contain all of the required information and data, you should confirm the data used to prepare your affirmative action plans are both complete and correct. For instance, you should confirm that the recruitment areas identified in the plan’s availability report are correct and that the percentages/weighing of internal versus external recruiting is consistent with your company’s recruiting activity. Additionally, you will want to confirm that the numbers of applicants, hires, promotions, and terminations reflected in your plan are correct. If you identify any errors, these should be corrected before the plans are submitted to the OFCCP.
- Review the applicant flow log. In conjunction with your reconciliation of the AAP data, you should also separately review the company’s applicant flow log to be sure that all applicants (as that term is defined under the OFCCP’s internet applicant rule) are included on the log and have disposition codes that specify whether they were hired and, if not, why they were not hired, and at which stage of the hiring process (e.g., application review, interview, second interview, post-offer, etc.) that decision was made. The log should also contain the gender, race/ethnicity, protected veteran status, and disability status for each applicant. Additionally, it is important that any candidates who do not satisfy the definition of an applicant (i.e., because they did not meet the basic qualifications for the position, were not considered by the company for the position, or withdrew from the process) are clearly identified and/or are removed from the applicant flow log. These individuals should not be included the applicant pool (counted in the number of applicants) identified in the company’s affirmative action plan.
- Identify, investigate, and explain any “red flags” in your AAPs. It is also important to put yourself in the OFCCP compliance officer’s shoes and identify, investigate, and explain any “red flag” items in your plans. For instance, you should review your adverse impact reports for hiring, promotions, and terminations to see if there are any indicators of potential discrimination. Pay particular attention to entry-level job groups and job groups with a high volume of employment activity as these are high-priority focus areas for the OFCCP. If there are any indicators of potential adverse impact, evaluate each step of the employment process (e.g., hiring, promotion, etc.) to determine whether there are particular factors that may be causing the adverse impact and remedy them where possible. Other potential red flags that should be investigated and addressed include, but are not limited to, one-to-one applicant to hire ratios (suggesting a potential failure to post, and recruit for, the position), numerous unknown races or genders for applicants and hires (indicative of a potential failure to solicit self-identification forms from applicants and new hires), multiple placement goals and/or a lack of progress towards meeting the prior year’s goals (highlighting a potential failure to engage in effective good faith outreach and recruiting efforts), and a boilerplate listing of good faith efforts (suggesting a potential failure to identify and employ effective good faith efforts).
- Begin collecting supporting documentation and consult with legal counsel as necessary. Although there will be time to collect additional documentation after submitting the initial response to the OFCCP, it is best to collect any supporting documentation and consult with legal counsel regarding any potential red flag issues prior to responding. Counsel may be able to assist with the identification and remedying of certain red flag issues in advance of submission (e.g., goals or other adverse indicators resulting from outdated, erroneous, or incomplete data) and should be made aware of any potential issues that cannot be remedied before any data is sent to the OFCCP. In addition, counsel can help the company identify likely areas of additional inquiry before any more requests are received from the OFCCP. Counsel may also be able to assist with obtaining an extension of time to respond if such an extension is warranted under the circumstances.
Given the aggressive nature of the OFCCP’s current enforcement agenda and efforts, it is often the little things that matter the most. Errors in data, a lack of records, or a failure to review and understand the information in the company’s AAPs can create substantial problems during an audit and may result in significant legal liability for a company.