OFCCP Releases Three New Policy Directives: On November 30th, the OFCCP released three policy directives, continuing the string of several directives issued by the new administration. These new directives all strive to advance clear and efficient compliance procedures. The three new directives are summarized as follow…
- Opinion Letters and Help Desk (DIR 2019-03) – In an effort to improve compliance assistance efforts, the OFCCP will enhance its Help Desk service by making certain inquiries and responses dynamically available and searchable on its website. This self-service option allows contractors to benefit from others’ inquiries and improves the efficiency of the Help Desk operations over time. The OFCCP will also begin issuing Opinion Letters for employers and employees to give them fact-specific guidance, as other agencies in the Department of Labor have done. These letters will explain new and existing regulations in further detail than is usually provided.
- Early Resolution Procedures (DIR 2019-02) – This directive establishes the OFCCP’s Early Resolution Procedures (ERP) that will help reduce the length of compliance evaluations by resolving problems, including systemic issues, more quickly. The ERP allows contractors with multiple establishments to cooperatively develop corporate-wide compliance, beyond the establishment being audited, since issues found at one establishment may exist at others due to corporate-wide policies and human resource systems. The directive outlines procedures, ideally to be completed within 60 days, applicable to three types of violations:
- Non–Material Violations – If the Compliance Officer (CO) finds non-material violations (such as an unacceptable AAP element) and there are no indicators of potential discrimination or lack of good faith efforts, the CO should seek to resolve the evaluation during the desk audit, provide any compliance assistance, and issue a closure letter.
- Material Violations: Non-Discrimination – The OFCCP will seek to resolve material non-discrimination violations (record keeping, applicant tracking, failure to implement audit and reporting systems, failure to conduct self-analysis, etc.) through an Early Resolution Conciliation Agreement with Corporate-Wide Corrective Action (ERCA). The contractor will be required to review all, or a negotiated subset, of its remaining establishments for similar violations during a progress report-monitoring period, and will provide progress reports and supporting documentation with specific information such as findings and corrective actions. The OFCCP will not schedule a new compliance evaluation at that particular establishment for five years, although it may schedule a compliance evaluation at other establishments including those covered by the monitoring requirement.
- Material Violations: Discrimination – The OFCCP will request additional information and essential interviews regarding the violation to refine indicators, identify those potentially affected, and estimate a monetary remedy. Upon receipt of the additional information, the CO will complete a refined analysis. If discrimination is still indicated, the contractor may provide additional information to refute the finding of discrimination. If discrimination continues to be found, the OFCCP will seek make-whole relief for affected class members. The ERCA will require contractors to review other establishments for similar violations and implement corrective action during a five-year progress report-monitoring period. The OFCCP will not schedule any of the contractor’s covered establishments during this period.
- Compliance Review Procedures (DIR 2019-01) – This directive rescinds DIR 2011-01- a directive that outlined Active Case Enforcement (ACE) procedures, which had previously replaced Active Case Management (ACM) procedures. ACM, under the Bush administration, focused on cases with indicators of systemic discrimination in an effort to increase efficiency and shorten desk audits. ACE, under the Obama administration, focused efforts on conducting “deep-dive” audits (full OFCCP desk audits under all three legal authorities, more mandatory onsite reviews, and high rates of violations). Due to the increased scrutiny, there were fewer audits (scheduled evaluations went from 5,000 per year in 2007 to 1,000 per year in 2017) and there was an increase in overall processing time. The OFCCP announced there was no longer a need for the ACE directive, noting that the agency had recently adopted new guidance and procedures that strive to increase transparency, increase the number of compliance evaluations, shorten the time to complete desk audits, and conciliate issues more efficiently. Going forward, the agency directs its staff to follow the compliance evaluation procedures in accordance with the Federal Contract Compliance Manual and, as needed, with agency guidance, policies, and procedures.