The NILG 2022 National Conference was held July 25-28, 2022 in Boston, MA. The Conference was highlighted by OFCCP Director Jenny Yang’s keynote address to the federal contractor community about affirmative action and pay equity compliance. Director Yang set the tone for the conference and what the contractor community could expect in the coming months. Yang outlined the following three immediate priorities for OFCCP: (1) Pay Equity, (2) Contractor Affirmative Action Program (AAP) Certification, and (3) Audit Readiness.
1. Pay Equity:
OFCCP has identified that over 80% of contractors are NOT proactively conducting pay self-analysis. Directive 2022-01 reinforces the current regulation under 41 CFR 60-2.17(b)(3) that, at a minimum, the contractor must evaluate their compensation systems to determine whether there are gender, race, or ethnicity-based disparities. During an audit, Compliance Officers will be expecting documentation on pay analysis to be included in the contractor’s audit submission. It is imperative that contractors engage in some form of pay self-analysis on a regular basis, i.e. annually as a component of the AAP update. The Agency will be working with contractors during an audit in an effort to change these behaviors. Contractors should evaluate their current practices, and coordinate with their AAP compliance team or their consultant to ensure that the Pay Equity Self-Analysis is part of their normal annual affirmative action plan update and maintenance process.
2. Contractor AAP Certification:
Director Yang said, “Do not ignore the AAP certification.” Federal contractors had until June 30, 2022, to complete their AAP certification using the OFCCP’s Contractor Portal. The June 30, 2022 deadline was not extended. Any Contractor that has not completed their certification should do so as soon as possible. The Agency has stated that any contractors that missed the deadline will be very likely placed on an upcoming Audit Scheduling list to verify that they have developed and are maintaining a current affirmative action plan. The takeaway for any contractor that has not certified their AAPs is to complete the certification process as soon as possible. The process is time-consuming and data intensive. Ensure that you coordinate with your AAP team to have the latest details on all the AAPs, employee counts, closed establishments, new establishments, and other demographic information. More importantly, verify that you have a current and active affirmative action plan for each of your establishments.
3. Audit Readiness:
One of the Agency’s focus areas is improving efficiencies in compliance evaluations. The Contractor Portal was implemented as an effort to improve the poor record of contractor compliance in developing affirmative action plans. According to the General Accountability Office (GAO), 85% of federal contractors are not fully developing, or have implemented an affirmative action plan(s). The Contractor Portal is an effort to increase compliance to ensure contractors have implemented their AAPs, and are audit ready. As a result of the certification, OFCCP is expecting a contractor to be timely in their audit submissions. The contractor has 30 days from receipt of the Audit Scheduling letter to deliver the complete set of submission items. OFCCP will no longer grant extensions (Directive 2022-02). Extensions will be granted very sparingly and for very specific reasons, e.g. loss of resources due to death. All three affirmative action plans must be audit-ready with supporting documentation, including documentation on action-oriented programs, and all the other required elements, i.e., analysis of selections and the Pay Equity self-analysis. A contractor must be able to provide documentation in all of these areas to provide a complete and timely submission.
Director Yang also discussed other areas of focus for the OFCCP:
- Rebuilding OFCCP staff: 100 new compliance officers by September 2022, training new/existing staff, and strengthening data analytics
- Scheduling onsite reviews: OFCCP employees are now back in the office and scheduling onsite reviews which are currently ongoing
- Improving the scheduling methodology: Focusing on areas of systemic discrimination and coordinating with EEOC to leverage EEO-1 representation data to target contractors for audit
- Understanding how employers operate and store data: Modernize the agency's efforts to work with federal contractors
- To provide efficiencies for employers analyzing their selections: Help contractors avoid ways to hide or mask problems.
- Ensuring workers are safe in reporting employment issues, i.e. complaints
- Scheduling additional Construction Contractor audits
- Developing new methods/policies in analyzing data before going on site
- Data analytics and technologies to analyze construction contractors
What are some clear 'take-back-to-the-office' items from this conference?
|✔️||Start the process for an annual pay review. Use your AAP to trigger a yearly reminder. Annually is the minimum you should be evaluating pay. However, some companies may need to perform analysis more frequently.
||Lessen the likelihood of an audit. Complete your Affirmative Action Certification through the OFCCP Contractor Portal.|
|✔️||Add DE&I to your AAP compliance stack. DE&I efforts can offer proof of affirmative action program implementation which can be helpful during an audit. Remember, the agency is looking for material actions. Note: An AAP stack is the collection of practices (pay, recruitment, training, etc.) you need to be audit-ready and in full compliance.|