This straightforward guide is designed to help government contractors prepare for compliance measures surrounding their contingent workerforce.
According to the United States Department of Labor, the Office of Federal Contract Compliance Programs (OFCCP) began mailing Corporate Scheduling Announcement Letters (CSAL) to approximately 800 government-contracted establishments starting in February of this year. Upon receiving the letter, your organization has approximately 30 days to make sure management is ready for a potential audit and to make sure you are compliant with affirmative action laws.
What are affirmative action laws, you ask?
It has to do with Executive Order 11246 of the aforementioned United States Department of Labor's OFCCP. This order requires that all federally contracted companies be equal employment opportunity employers. As such, they must adhere to the rules established by the OFCCP.
What does that mean?
If you are one of the lucky organizations selected, you will have to conduct a self-audit to ensure that your organization has been following all the OFCCP compliance rules. The actual Scheduling Announcement Letters will be sent directly to you and the other selected organizations (sent March 17th) and that will signal the audit to officially begin.
If this is news to you, let's give you a little breakdown:
It's important now more than ever to track where your workforce is coming from, especially if you are a federal contractor. Since this rule doesn't apply to the contingent worker population, most employers haven't been effectively tracking the applicant flow for this group. But now, in this new "gig economy", it's more common than ever that contingent talent pools are being used to fill full-time jobs. That means, when the OFCCP audit letter comes in the mail, you will need to track the record of your hire from the time they were selected to join that contingent worker pool to the time they were hired full-time.
As mentioned, some organizations weren't tracking this data at a contingent worker level. So when they receive that letter, 30 days to get that information together may prove to be a little more difficult than it sounds.
To avoid being taken by complete surprise, it's important that you have processes in place for contingent workers so that you'll have all of the required information surrounding this workforce to make sure your hiring practices are compliant. Not sure where to start? That's what we are here for.
Making Sense of OFCCP Compliance
Know Your Affirmative Action Plan
An affirmative action plan (which is part of an affirmative action program) compares the composition of the employer's workforce (people actually hired, working, or terminated) against the composition of the relevant labor pool, in order to see if women and other minority groups are being hired, promoted, or terminated at a rate lower than what would be expected, if the selection process was fair and nondiscriminatory.
One component of an affirmative action plan requires federal contractors to look at all selection decisions made over the prior year in order to see if there was a disparate impact in the selection of women and minorities, i.e. compare the composition of all applicants to a position against the successful candidates.
Federal contractors have no obligation to include data about true temporary positions in their affirmative action plans. But, as I mentioned above, it's becoming more common for companies to use their temporary labor pool, so therefore if you are a government contractor, it's important for you to start implementing these practices in all of your hiring.
Track All Applicant Flow Data
For every position filled during a plan year, an employer must gather "applicant flow data" as a requirement of an affirmative action plan. We suggest using an Applicant Tracking System (ATS) to make sure you track all the data you need. Here are some examples of what you need to track to be sure you have all the information you need for an audit.
- Date application was received
- Name of the applicant
- Position applied for
- Job group of that position or its Equal Employment Opportunity Commission (EEO) code
- Race and sex of the applicant
- Veteran status of the applicant
- At each step in the hiring process, whether the applicant was selected or rejected
- If the applicant was selected, the date of hire
- If the applicant was not selected, the reason for non-selection
Know the Internet Applicant Rules
The Internet Applicant Rule addresses record-keeping by federal contractors and subcontractors about the internet hiring process and the solicitation of race, gender, and ethnicity of "Internet Applicants." An "Internet Applicant" is basically a job seeker applying for work through the Internet or any "electronic data" technologies (e-mail, fax, etc).
This is a comprehensive protocol for maintaining records and standards regarding all steps of the selection process done through any digital technology. How you develop those standards can vary company to company, but you must make sure you have a reason for every decision made along the way through your digital process. This is something that your contractors MUST be trained on and know how to speak to in case of an audit.
To say the OFFCP compliance rules can be lengthy and complicated is a bit of an understatement. But if you are a government contractor and your company takes steps in the right direction to track and record everything that is needed to be compliant, you will be able to easily pull that information together when that letter comes to your door.
For more information on the OFCCP and their compliance guidelines visit: https://www.dol.gov/ofccp/
Marcia Hagood is a Senior Director of Supplier Management for Yoh. Marcia brings more than 15 years of supplier management experience