Recruitment and hiring processes are changing, and they are changing fast. Similar to how fast the internet changed public lives in the 1990’s, elaborate internet tools such as social media, job boards, online diversity associations and job posting requirements are changing the lives of recruiters and Federal contractors right now. In turn, contractors have a lot of questions about how to keep pace with their recordkeeping policies and data collection processes to meet evolving Affirmative Action compliance requirements.
The fundamental principal remains the same; OFCCP expects, nay demands, that Federal contractors collect detailed data that allows contractors to identify an applicant pool and the resulting hire(s). The decision criteria for each step in the selection process is equally important and necessary for compliance analyses. In terms of risk management during an audit, data related to hires should be top priority for any contractor.
OFCCP has little tolerance for any selection practice that lacks detailed data and/or suggests a discriminatory pattern in hiring. Applicant and hire data are always a weak spot for contractors during desk audits and the vast majority (almost all actually) of financial settlements are related to problems with the data. For examples, see the OFCCP Press Releases here; http://www.dol.gov/opa/media/press/ofccp/. Almost every headline has the term “hiring discrimination.”
The problem with rigorous data collection requirements is that many contractors large and small are still struggling to catch up with the changes in technology and expectations. Contractors are slowly but surely engaging applicant tracking systems and making an effort to collect race and gender data to allow for proper analyses as part of their annual Affirmative Action Plan (AAP). However, even this practice is still barely past the early adopter phase and I doubt many companies are confident about saying that they are successfully identifying all the applicant details for every hire, with an emphasis on a lack of success obtaining a high percentage of voluntary race and gender information prior to a hire. Additionally, there is a gap in communication between the applicant system and the Human Resource Information System (HRIS) that plagues contractors’ recordkeeping efforts. How many contractors do a good job of retroactively identifying employee race and gender and applying it back to the application data? In other words, accurate data collection is a work in progress that causes significant hardship, and often results in conciliation agreements during OFCCP audits.
Today, contractors have another critical layer of expectations to deal with and that is the use of emerging recruitment tools in addition to more light being shed on some tricky issues that used to be passed over without a lot of fanfare.
Data and Record Retention when working with Social Media
A hot topic often discussed at Industry Liaison Groups and within message boards is recruitment compliance when using social media (Facebook, LinkedIn, craigslist, etc.) to find job candidates. Tools like Facebook and LinkedIn are already in heavy use as recruiting tools for contractors and these programs are popular because they are fast, cheap and provide detailed information regarding potential candidates. Recruiters can quickly hone in on active job seekers in addition to qualified individuals who may be lured away from their current job allowing for broader recruitment opportunities than the standard job posting websites. While the benefits are alluring, at the other end of the spectrum, the drawbacks are equally daunting. Not only does social media create recordkeeping headaches for contactors due to its more random and selective nature, but the Department of Labor has zeroed in on the significant potential for discrimination when the use of any recruitment tool puts the race and gender of the potential applicant right in front of the recruiter when the hiring process is supposed to be color and gender blind. Labor attorneys have been speaking publicly about this whole new avenue of legal challenges and how organizations need to implement detailed policies to protect themselves from future liabilities. When writing this, I was reminded of an article I read in the New York Times about how minorities are hesitant to use their proper names on a resume for fear of being denied a fair chance at an interview. See article here http://www.nytimes.com/2009/12/06/weekinreview/06Luo.html. Since social media suffers from the same stigma where race and gender is front and center, recruiters and contractors need to make sure that they have a plan in place including strict legal policy in place for fair recruiting, recordkeeping requirements for users of social media, and analyses to ensure that the results do not show that certain races or genders are being adversely impacted. Users of social media for recruiting need to make sure that the people they recruit, who meet the four criteria for being an applicant, get into the applicant data pool. Details on the internet definition of an applicant should be reviewed here; http://www.dol.gov/ofccp/regs/compliance/faqs/iappfaqs.htm#Q6GI. There is heightened concern with social media because analysis results could show that minorities or females are not being impacted, but that can be deceiving if they are not being selected as applicants to start with. In social media, the problem could be hidden so users must be aware of the ramifications.
Data and Record Retention when working with Unions, Union Contracts, and Collective Bargaining Agreements
Again, the regulations require that contractors collect data that identifies who was considered for hire and who was selected. In regards to union activity, the OFCCP has been generally hands-off. In an audit, OFCCP does request copies of bargaining agreements; however, there has been little focus on any associated data. OFCCP has stated publicly that they intend to look more closely at union contracts and that a union agreement does not exempt an employer from their regulatory obligations.
There are a few questions that often come up related to recordkeeping compliance related to unions. One common question is related to job posting and if employers still have to post a job if the hire will come from under a union agreement and the answer is yes. While the employer may direct the job seeker to the union for consideration, the employer must still post the position based on the requirements under the Jobs for Veterans Act (JVA) which only has three exceptions to the job posting requirement including; posting for executive positions, temporary jobs or jobs filled internally. Another common question is related to applicant pools. While contractors typically do not include applicant pools based on who the union considered, the employer is still obligated under the law to require the union to track data and have it available upon request. It is also not out of the realm of possibility that OFCCP can request data on who was considered for the position. Contractors also ask if hires provided by the union should be tracked in the applicant system in addition to the hiring or payroll system. While this question is more likely to draw a range of responses, I still suggest that you track the applicant record assuming the hire will be reflected in the job group and the transaction analysis would be imbalanced without a corresponding applicant record.
Data and Record Retention when working with Staffing Agencies; What about Temp to Hire Situations
Similar to managing the recordkeeping requirements for unions, contractors must make specific efforts to ensure that staffing agencies are aware of the contractors’ obligations under the law. If contractors are bringing people onto their payroll from a staffing agency, then the contractor is responsible for the selection process used to choose people who end up as active employees, which in turn means that the staffing agency, on behalf of the contractor, must use non-discriminatory practices and be able to provide data for Affirmative Action purposes. Again, OFCCP may not ask for the data in an audit, but that doesn’t eliminate the obligation to follow the rules. It is important that the contractor maintain records demonstrating that they have informed the staffing agency of the legal requirements because OFCCP will not go after the staffing agency if there is an issue. OFCCP will go straight to the contractor. If the staffing agency is not collecting the required data or they have questionable practices for how they select candidates for the contractor, the contractor will absorb the blame. Employers may not be used to asking for or reviewing applicant files from the staffing agency, but Best Practices suggest they would do so as they own that information as much as any process they manage themselves in the eyes of the OFCCP. Here is a quote from the OFCCP Frequently Asked Questions web page related to recordkeeping expectations “The use of a recruiting firm in the hiring process does not relieve a contractor of its recordkeeping obligations under 41 CFR 601.12; the contractor will be held accountable if the specified records are not maintained.”
Recording Temps to Hires – Managing data for temps is one of the tricky areas where someone could ask 10 consultants and likely get 10 different answers. Contractors should try to avoid undefined processes that create risk, so focus on a few key items to define a policy where needed.
- For temps, contractors should consider if the data belongs to them. Are the temps on the company payroll? If not, then they likely don’t belong in the AAP.
- For those who are hired as temps on the contractor payroll, they should be tracked as they likely comprise the applicant pool for any permanent selections.
- If some temps are kept and others are released, that is a prototypical opportunity to discriminate and all data should be retained. The contractor selection criteria can fall under the spotlight here. If temps are kept as permanent hires based on undefined rules such as “the manager liked him/her”, then that is an area to clean up and add rules.
- Sometimes there are 1:1 ratios where temps become a permanent hire and that is ok, so long as there wasn’t a selection pool being ignored.