Hunton Employment & Labor Perspectives

The Office of Federal Contract Compliance Programs (“OFCCP”), an agency within the Department of Labor, has recently announced two significant changes that will impact covered contractors and subcontractors in the coming months. 

1)  AAP Certification Requirement

Each year, thousands of federal contractors and subcontractors prepare affirmative action plans (“AAPs”) pursuant to OFCCP requirements. Companies maintain the AAPs internally, but do not submit them to OFCCP, unless and until an establishment is audited by the Agency.  As such, OFCCP has no practical way of confirming AAP compliance for the majority of covered contractors.  That is… until now.

Federal contractors will, in the near future, be required to file verification of AAP compliance on an annual basis (precise deadline to be announced).  Verification will be made through a web-based portal maintained on OFCCP’s website.  OFCCP recently obtained OMB (Office of Management and Budget) approval for an AAP Verification Interface (“AAP-VI”), for this purpose.

Employers will not submit the actual AAPs as part of the verification process.  (However, during audits, contractors will use the submission portal to provide documents to OFCCP.)   Instead, contractors will select a statement to certify whether they have, or have not, developed and maintained AAPs for each applicable establishment.  There will also be an opportunity to indicate if a company is a new contractor, within its initial 120 compliance window.

OFCCP will likely cross-reference verifications with a list of employers who self-designate as covered contractors and subcontractors in EEO-1 Reports.  “Show Cause” notices, and potentially litigation, may ensue for noncompliant businesses.

2)  Updated Census Data for Availability Analyses

Employers rely on demographic details from census data in preparing their annual affirmative action pans (“AAPs”).  Specifically, survey data from the U.S. Census Bureau indicates the number of minorities and women who work in particular occupations, in particular geographic areas.  This information helps employers measure the “available” applicant pool for jobs, and provides the building blocks for AAP availability, utilization, and placement goal analyses.  See 41 CFR 60-2.14(a).

For some time, contractors have been awaiting the release of a more current census data set.  Employers have had to rely on the 2006-2010 EEO Tabulation, which was the most recent census data available.  Understandably, businesses had grown concerned that such outdated information cannot accurately measure the composition of the current job market.  And, this impacts not only covered contractors and subcontractors under OFCCP but, also, employers who use census data for diversity, equity and inclusion (“DEI”) assessments.

The U.S. Census Bureau released the 2014-2018 EEO Tabulation in March of this year, but only recently completed a permanent application programming interface, which allows the data to be used in AAPs.

Covered federal contractors and subcontractors must begin using the updated census data in all AAPs that are developed on or after January 1, 2022.   This is also the date when OFCCP will begin using the new data to evaluate companies.  Employers are free to begin using the data earlier, if they wish.