This article is a companion to an article in the March 2015 edition of The OFCCP Digest. As we noted there, on October 1, 2014, the U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) released a new version of the scheduling letter and itemized listing that the agency sends to organizations at the start of an affirmative action compliance review. The previous version of the itemized listing asked for 11 items; the revised version asks for 22 items.
In last month’s article, we focused on the revisions to the request for compensation data found in the new version of the itemized listing. In this article, we’ll focus on the changes to OFCCP’s request for personnel activity data and on the 11 new requests for information growing out of the revised veterans and disability regulations.
Personnel Activity Data Involving Race, Ethnicity, and Gender
Item 10 of OFCCP’s previous itemized listing requested applicant, hire, promotion, and termination data for employees in the affirmative action plan under review. Item 18 in the revised itemized listing continues to request this data, but item 18 now explicitly requests data by the following race/ethnicity categories: African-American, Asian/Pacific Islander, Hispanic, American Indian/Alaskan Native, and White. The previous version of the itemized listing only required the submission of data on whites and total minorities. For applicants, OFCCP is also requesting information on persons of unknown race. OFCCP is similarly requesting data on applicants of unknown gender along with data on males and females.
OFCCP’s itemized listing uses the five traditional race categories that are found in the affirmative action regulations under Executive Order 11246 when requesting race/ethnicity information. However, OFCCP has a directive (Directive 2008-02, formerly numbered as Directive 283) that allows the submission of data using the seven race/ethnicity categories found on the EEO-1 report.
- Tip Number 1: While organizations may submit race and ethnicity data using either the five traditional race/ethnicity categories or EEOC’s seven race/ethnicity categories, organizations should be sure to submit information on each subgroup and should be sure to submit information on applicants of unknown race/ethnicity and/or gender.
OFCCP continues to use the data submitted in item 18 to determine whether there are any disparities involving the hire, promotion, or termination of employees. When OFCCP finds such disparities, it may investigate whether discrimination has occurred. With the changes to the itemized listing to include all race/ethnicity categories, OFCCP now has far more opportunities to find statistical disparities in any data submitted as part of a compliance review.
- Tip Number 2: As preparation for compliance reviews, organizations should analyze data on each race/ethnicity subgroup and on each gender to determine where statistical disparities exist.
Item 18 also requires organizations to provide a definition of “promotion.” If the facility under review has definitions of promotion that vary for different parts of the workforce, the organization is required to provide information on these various definitions. Organizations are allowed to determine what constitutes a promotion, but the definition of promotion should be applied in a uniform way. Organizations should review personnel activity data on job changes to ensure that any two transactions of the same type are either shown as promotions or as non-promotions. For example, if a move from Buyer to Commodity Specialist is shown as a promotion for one employee, then every situation where a Buyer moves to a Commodity Specialist should typically be shown as a promotion.
- Tip Number 3: Review data on all job changes carefully to ensure that the definition of promotion is applied consistently.
Evaluation of the Effectiveness of Outreach Efforts
Item 7 in the itemized listing requires that an organization undergoing a compliance review should submit results regarding its evaluation of the effectiveness of its outreach and recruitment efforts for individuals with disabilities. Item 11 is a parallel provision for veterans. This evaluation of outreach efforts is a key part of the revised regulations for individuals with disabilities and veterans. The evaluation of outreach efforts is an important time to discuss the positive efforts made to find individuals with disabilities and protected veterans. It is NOT a good time to dwell extensively on an organization’s failures, though it is important to discuss changes that might be made to outreach efforts if the previous year’s efforts were unsuccessful. Items 7 and 11 might be implementing new provisions in the federal regulations, but organizations were actually required under the former regulations to make efforts to recruit and employ individuals with disabilities and protected veterans.
- Tip Number 4: Be prepared to provide specific, documented information on outreach and recruitment efforts made to find individuals with disabilities and protected veterans. Focus on positive efforts made and results achieved, but also note changes that might be made in future outreach and recruitment efforts.
Audit and Reporting Systems
Item 8 in the itemized listing requests documentation of actions taken to comply with the audit and reporting systems requirements found in the regulations for individuals with disabilities. Item 12 is a parallel provision for veterans. While the previous version of the federal regulations for individuals with disabilities and veterans required organizations to have an audit and reporting system on actions taken to provide equal opportunity and affirmative action to individuals with disabilities and protected veterans, the revised regulations include a provision that requires documentation of this audit and reporting system.
- Tip Number 5: Be prepared to provide documentation regarding the manner in which efforts to implement the affirmative action plans for individuals with disabilities and protected veterans are measured and evaluated.
Data Collection Analysis
Item 9 in the itemized listing requests the statistical data on applicants and hires that organizations must now collect under the revised regulations for individuals with disabilities. Item 13 is a parallel provision for veterans. The regulations require that organizations collect the following data:
- The number of applicants who self-identified as individuals with disabilities or who are otherwise known to be individuals with disabilities, and the number of applicants who self-identified as protected veterans or who are otherwise known to be protected veterans;
- The total number of job openings and total number of jobs filled;
- The total number of applicants for all jobs;
- The number of applicants with disabilities hired and the number of protected veterans hired; and
- The total number of applicants hired.
OFCCP has released answers to several frequently asked questions (FAQs) on its website (http://www.dol.gov/ofccp) about the information that is to be required for this data collection analysis. However, some portions of the FAQs seem to provide definitions of terms that are contrary to OFCCP’s typical definition of these terms. For example, in item 18 of the itemized listing, OFCCP makes an explicit distinction between hires and promotions. By contrast, one of OFCCP’s FAQs indicates that the term “hired” as used in points 4 and 5 above refers both to EXTERNAL CANDIDATES who are brought into the organization as well as EMPLOYEES who are selected through an internal promotional process. It is not clear how or whether OFCCP will reconcile some of these inconsistencies. It is also not clear what affect these FAQs will have on data collection and analysis. FAQs and directives do not have the same force of law as formal regulations, and OFCCP has been known to withdraw or disregard FAQs.
- Tip Number 6: Carefully read OFCCP’s FAQs on the data to be collected and analyzed on individuals with disabilities and protected veterans. Determine how terms such as “job openings,” “jobs filled,” and “hires” will be interpreted for your organization, and be prepared to explain your interpretation to OFCCP.
Regardless of how terms in the data collection are interpreted, federal contractors and subcontractors will need to ensure that data on disability and protected veteran status is being collected from applicants and hires so that reporting can begin. Items 9 and 13 in the itemized listing seem to suggest that all organizations going through a compliance review will need to submit the information required in the data collection analysis portion of the revised regulations. However, organizations were only required to start this data collection at the time AAPs were first updated after March 24, 2014. Thus, an organization with January 1 AAPs will have been required to begin this data collection on January 1, 2015. The first time such an organization will have a full year of data to analyze is January 1, 2016. It is important to note that items 9 and 13 both say that if an organization undergoing a compliance review is more than six months into its current AAP year, it must submit at least the first six months of data. Thus, an organization with January 1 AAPs that starts a compliance review in August of 2015 will need to submit at least six months of the data required for the data collection analysis.
- Tip Number 7: Understand how your AAP date affects the requirement to submit the data on applicants and hires required under the revised veterans and disability regulations.
Disability Utilization Analysis and Veterans Hiring Benchmark
Item 10 in the itemized listing requests the utilization analysis by job group for individuals with disabilities required under the revised regulations. Most organizations must submit information on the percentage of individuals with disabilities in each job group and compare that percentage against OFCCP’s 7% utilization goal. Smaller organizations may only need to compare the utilization goal to the entire workforce. (Note that this 7% utilization goal is subject to change, and that OFCCP can publish a new utilization goal on its website when it believes the goal should be modified.)
Item 14 requests information on the hiring benchmark for protected veterans that is required under the revised regulations. OFCCP has currently set this hiring benchmark at 7.2%. The hiring benchmark for protected veterans is NOT the same as the disability utilization goal. The disability regulations state that there must be a comparison between the percentage of individuals with disabilities in the workforce and the utilization goal. The veterans regulations state that federal contractors and subcontractors must develop a company-wide hiring benchmark. There is no specific requirement to compare the benchmark to actual hires, and there is no requirement to compare the hiring benchmark to the percentage of protected veterans in the workforce.
- Tip Number 8: When providing information for item 14, consider providing to OFCCP ONLY the 7.2% hiring benchmark.
Organizations are allowed to develop their own hiring benchmark for protected veterans. However, they must consider a variety of factors published by OFCCP and must document how their hiring benchmark was established. For organizations that use the 7.2% company-wide benchmark established by OFCCP, there is no additional documentation to submit to OFCCP on how the benchmark was developed.
- Tip Number 9: Organizations should use OFCCP’s 7.2% hiring benchmark rather than creating their own benchmark.
Item 20 in the itemized listing requests copies of reasonable accommodation policies and documentation of accommodation requests made by applicants or employees, including the actions taken by an organization in response to these requests. Many requests for accommodation of a disability are handled by supervisors or human resources staff members without any formal record being created. Organizations should determine how they will keep track of requests for accommodation. However, organizations should be wary of how information is collected and how this information is submitted to OFCCP. Documentation submitted to OFCCP that includes names and descriptions of specific disabilities may raise a variety of privacy concerns for employees and employers alike. There needs to be a balancing act between meeting the privacy concerns of employees and providing sufficient information to OFCCP.
- Tip Number 10: Develop a procedure to collect information on reasonable accommodation requests made by applicants and employees and the results of these requests. Ensure that this information is collected and stored in as confidential a manner as possible. Limit the details that are provided to OFCCP about accommodation requests.
Assessment of Personnel Processes and Assessment of Physical and Mental Qualifications
Item 21 in the itemized listing requests information on an organization’s assessment of its personnel processes and how those processes affect individuals with disabilities and protected veterans. Item 21 indicates that organizations should provide a date for the most recent assessment and a date for the next scheduled assessment. Item 22 requests information on an organization’s review of physical and mental qualifications for jobs. Item 22 indicates that organizations should provide a date for the most recent assessment of these qualifications and a date for the next scheduled assessment.
The language in items 21 and 22 does not precisely follow the language in the relevant sections of the revised regulations. While items 21 and 22 request specific dates that assessments were prepared as well as the date for the next scheduled assessment, the language in the regulations actually states that federal contractors and subcontractors should “periodically review” their personnel practices and their physical and mental qualifications for jobs. The regulations provide no firm definition of what constitutes a “periodic review.” It may be appropriate to conduct the periodic review of personnel practices when affirmative action plans are updated. However, many organizations review physical and mental qualifications as positions open, or on some other type of rolling basis.
- Tip Number 11: Determine when reviews of personnel processes and physical and mental qualifications will occur. If physical and mental qualifications are reviewed when positions open or on some other rolling basis, inform OFCCP that this is the case.
IN SUMMARY: It should be clear from this article and its companion that the changes to the itemized listing are wide-ranging and important. We strongly encourage you to review the itemized listing closely and consider how the changes to the itemized listing will affect your preparation for an OFCCP compliance review.
Please note: Nothing in this article is intended as legal advice or as a substitute for any professional advice about your organization’s particular circumstances. All original materials copyright © HR Analytical Services Inc. 2015