always be prepared the ofccp audit and enforcement survival guide n.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Always be Prepared:  The OFCCP Audit and Enforcement Survival Guide PowerPoint Presentation
Download Presentation
Always be Prepared:  The OFCCP Audit and Enforcement Survival Guide

Loading in 2 Seconds...

play fullscreen
1 / 41

Always be Prepared:  The OFCCP Audit and Enforcement Survival Guide - PowerPoint PPT Presentation


  • 121 Views
  • Uploaded on

Always be Prepared:  The OFCCP Audit and Enforcement Survival Guide. Kris D. Meade Jody Shipper Partner Executive Director Crowell & Moring LLP Office of Equity and Diversity Washington, DC University of Southern California kmeade@crowell.com jshipper@usc.edu

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Always be Prepared:  The OFCCP Audit and Enforcement Survival Guide' - leroy


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
always be prepared the ofccp audit and enforcement survival guide

Always be Prepared:  The OFCCP Audit and Enforcement Survival Guide

Kris D. Meade Jody Shipper

Partner Executive Director

Crowell & Moring LLP Office of Equity and Diversity

Washington, DC University of Southern California

kmeade@crowell.com jshipper@usc.edu

202.624.2854 213.740.5086

introduction
Introduction

Agenda

  • Understanding the OFCCP and Its Agenda
  • Key Regulatory Developments
  • Key Enforcement Priorities – Hot Button Issues
  • Preparing for an Audit – Practical Tips
  • Surviving an Audit – Phase-by-phase Tips
  • Concluding an Audit – Potential Resolutions
ofccp overview and agenda
OFCCP – Overview and Agenda

Organizational Structure and Mission

  • Within Department of Labor
  • Enforces Executive Order 11246, the Vietnam-Era Veterans Readjustment Assistance Act (VEVRAA), and Section 503 of the Rehabilitation Act (Section 503)
    • Non-discrimination – “thou shall not”
    • Affirmative action – “thou shall”
  • National Office, Regional Offices, District Offices
    • Decentralized in practice
ofccp overview and agenda1
OFCCP – Overview and Agenda

Jurisdiction

  • Federal contractors and subcontractors – not grant recipients
  • “Subcontractor” – two prongs

Enforcement Tools

  • Compliance Reviews or “Audits”
  • Complaint Investigations

Remedies

  • No civil fines or criminal penalties
  • Standard Title VII-like remedies – back pay, reinstatement, instatement, pay adjustments
  • Debarment – ultimate sanction – rarely used
ofccp overview and agenda2
OFCCP – Overview and Agenda

Primary Obligations of Contractors and Subcontractors

  • Prepare Affirmative Action Plans (AAPs) - Annually
  • Engage in outreach
  • Flow down obligations to subcontractors
regulatory developments
Regulatory Developments

Overhaul of VEVRAA and Section 503 Regulations

  • Proposed Rules – 2011 – Substantial Increase in Contractors’ Obligations
  • Contractor Community Response – assessment of cost
  • Final Rules – announced August 27, 2013
  • Effective Date of Final Rule – March 22, 2014
    • “Phased In” compliance for AAPs
    • If AAP in place before March 22, 2014, no changes to AAP in 2014
    • Significant systems and process changes prior to March 2014
regulatory developments1
Regulatory Developments

Key Changes - Section 503

  • 7% Utilization Goal – every job group
  • Periodic Solicitation of Disabled Status
    • All Employees
    • All “Applicants”
  • Documentation of Outreach Efforts
  • Collection and Assessment of Disabled Applicant and Hire Data
  • New Subcontract “Flow Down” Language
  • Three-year Record-Keeping Requirement
  • Expanded Audit Scope
regulatory developments2
Regulatory Developments

Key Changes – VEVRAA

  • Solicitation of Veterans Status
  • Annual Hiring “Benchmarks” – workforce as a whole
    • 8% default
    • Set own
  • Documentation of Outreach Efforts
  • Collection of Veteran Applicant and Hire Data
  • New Subcontract “Flow Down” Language
  • Three-year Record-Keeping Requirement
  • Expanded Audit Scope
regulatory developments3
Regulatory Developments

Challenging Implementation Issues

  • Extent of Effort to Achieve 7% Goal
  • 8% Benchmark v. 5-Factor Analysis
  • How to Document Audit and Reporting System
  • Reasonable Accommodation Guidelines – Adopt?
  • Other
regulatory and enforcement agenda
Regulatory and Enforcement Agenda

Compensation Guidelines – Directive 307 issued 2013

  • Reflects importance of compensation issues to OFCCP
  • Rescinds Bush-era guidance – regressions and anecdotal evidence required
  • Ad-hoc, case-by-case approach
  • Statistical, non-statistical and anecdotal evidence
  • Pay analysis groups – broader than job title
  • Investigate at systemic, unit, and individual level
regulatory and enforcement agenda1
Regulatory and Enforcement Agenda

United Space Alliance – right to individualized compensation data

  • 2009 – scheduling letter issues; company provides aggregate compensation data – per item 11
  • OFCCP conducts “threshold test” – no indicators of discrimination
  • OFCCP conducts additional tests – “pattern test” – claims disparity, seeks individualized data
  • Company refuses
  • ALJ – orders company to provide data
  • District Court – 2011 – affirms based on substantial deference standard
recent significant decisions
Recent Significant Decisions

Frito-Lay – timeframe for investigation expanded

  • Scheduling letter dated July 13, 2007
    • Company provides activity data for 2005, 2006 and part of 2007
  • OFCCP claims data show “statistically significant disparity” – requests additional data - 2008 and 2009
    • Cites variance in female hiring rates – 3.26 standard deviations
  • Company refuses to produce – beyond date of scheduling letter
recent significant decisions1
Recent Significant Decisions

Frito-Lay

  • ALJ Decision – OFCCP precluded from seeking 2008-09 data; based on FCCM
  • ARB reverses ALJ
    • “OFCCP clearly has discretion to request AAP data covering activity occurring after the scheduling letter”
    • OFCCP’s “impetus” in seeking additional data “reasonable”
  • 2013 – Frito-Lay files challenge in federal court in Texas; OFCCP’s Motion to Dismiss pending
ofccp hot button issues
OFCCP – Hot Button Issues

Priority Issues – those that yield monetary recoveries

  • Compensation – lack of Agency experience with higher education
  • Personnel selection decisions – hires, promotions, and terminations
  • Applicant tracking and selection processes: Making sure your records talk, so your employees don’t have to be interviewed
hot button issue compensation
Hot Button Issue: Compensation

OFCCP’s limited understanding of factors common in higher education for determining differences in compensation can create traps for institutions

- Retention

- Reputation

- Differences in status of various publications

- Differences in funding sources

other traps easily exploited by ofccp
Other Traps Easily Exploited by OFCCP

Personnel Selection and Applicant Tracking:

  • Who is an “applicant” in a faculty search?
  • Does your faculty keep records of all searches?
  • Is everyone a Target of Opportunity Hire?
ofccp hot button issues1
OFCCP – Hot Button Issues

Outreach – Veterans and Individuals With Disabilities

  • How much is sufficient?
  • Record keeping?
  • Do results matter, or just the effort?
  • Side note: When asking for disability status, do you put yourself on notice of need to discuss reasonable accommodations?
slide20

OFCCP – Hot Button Issues

Internet applicants, tracking and testing

  • Record keeping
  • LinkedIn and other common job search sites
  • Pre-employment testing

Background checks

preparations for audit practical tips
Preparations for Audit – Practical Tips

Role of General Counsel’s Office

  • Often not intimately involved prior to audit
  • Recommendation
    • Become more involved in day-to-day program
    • Treat audit enforcement action and proactively manage response
    • Initial decisions may include whether to ask for delay
    • Review of past plan
preparations for audit practical tips1
Preparations for Audit – Practical Tips

Technical Review of AAP and Related Policies

  • Compliance with regulations
  • Potential exclusions
    • Temporary employees
    • Student workers
    • No definition of “employee”
preparations for audit practical tips2
Preparations for Audit – Practical Tips

AAP Structure

  • Multiple establishments?

Employment Tests

  • Use?
  • Locally validated?

Monitoring for Adverse Impact

  • Quarterly – applicants, hires, promotions, and terminations
  • Steps to address areas of adverse impact
preparations for audit practical tips3
Preparations for Audit – Practical Tips

Self-identification – race and gender (currently)

  • Different obligations for applicants and employees
  • “Decline to state” – gender vs. race
  • Approaches
  • Visual identification if no self-identification?
preparations for audit practical tips4
Preparations for Audit – Practical Tips

Record-keeping

  • Two years – “personnel records”
  • Tracking down “missing” records
  • Interview notes
    • How capture?
    • What level of detail?
  • Dispositions of candidates
    • The importance of consistency
preparations for audit practical tips5
Preparations for Audit – Practical Tips

Mock Audits

  • Particularly useful if not audited in last five years
  • Privilege issues
  • Areas of focus – parallel OFCCP areas of interest
  • Interview managers; examine data
preparations for audit practical tips6
Preparations for Audit – Practical Tips

Compensation Analyses

  • Pay equity studies – academic side
    • Routine practice on many campuses; transparency
  • Regressions – privilege issues again
  • Difficulty identifying and quantifying factors that impact pay – often not in data form
slide29

Practical Steps:

Each Phase of Audit

practical steps each phase of audit
Practical Steps – Each Phase of Audit

Receipt of “Pre-Scheduling” Letter

  • Assess readiness – areas of strength and vulnerabilities
    • AAP review
    • Understand your numbers – utilization and adverse impact
    • Compensation analysis – potential pay adjustments
  • Assemble audit response team
    • Interdisciplinary – HR/Affirmative Action/Compensation/Legal
    • Designate leads
  • Develop preliminary themes
  • Educate your client
practical steps each phase of audit1
Practical Steps – Each Phase of Audit

Receipt of Scheduling Letter

  • Data required
    • More than six months into AAP year? If so, analyze data for AAP year-to-date
  • Deadline for response – 30 days (extensions)
    • Pull compensation data – analyze, assess (and adjust?)
  • Format of response – varying approaches
    • Explain areas of apparent discrepancy – particularly on compensation
    • Confidential/Proprietary Information – password protect
  • Educate your client (again) and OFCCP
practical steps each phase of audit2
Practical Steps – Each Phase of Audit

Desk Audit Phase

  • Timeline – first contact can be within days or may not be for months
  • Additional data and document requests
    • Unreasonable deadlines – “within three days”
    • Impact of sequestration – travel limits – more done at desk audit
    • Accommodations, lists of employees who have taken leave and whether they returned
    • Charges filed with agencies and any settlements – “employee complaints”
    • Bate number all documents
practical steps each phase of audit3
Practical Steps – Each Phase of Audit

Desk Audit Phase

  • Develop Rapport with OFCCP Compliance Officer
    • Legal v. HR/affirmative action as point of contact
      • In-house counsel and outside counsel
    • Professional, respectful tone – even if not returned
    • Know when to push back and when to escalate
  • Silence – what then?

Low bar for moving from Desk Audit to On-Site Review

practical steps each phase of audit4
Practical Steps – Each Phase of Audit

On-Site Phase

  • OFCCP team
    • Large numbers
    • Many inexperienced
  • Opening conference
    • OFCCP will present
    • Be proactive – stress themes; inform about campus
  • Document reviews
    • Track all documents provided – if originals
    • Offer to provide as available
practical steps each phase of audit5
Practical Steps – Each Phase of Audit

On Site Review

  • Preparation – the big and the small
    • Legal
    • Media relations
    • Logistics – where and when
    • Parking?
    • Coffee and cookies – how comfortable do you want them to be?
    • Ask around – colleagues at other institutions may have direct experiences with same team members
practical steps each phase of audit6
Practical Steps – Each Phase of Audit

On-Site Phase

  • Logistics
    • Offices away from other employees and away from HR
    • Suggest places for lunch – not campus cafeteria
  • Interviews – key areas and key decision-makers
    • HR personnel – recruiting and compensation functions
    • Management personnel
  • Preparing staff and senior administrators
    • Brief on OFCCP and its mission
    • Ensure knowledge of AAP and compliance posture – themes
    • Deposition-like preparation
practical steps each phase of audit7
Practical Steps – Each Phase of Audit

On-Site Phase

  • Preparing non-management employees
    • No right to be present or have legal counsel present
    • Explain OFCCP and mission
    • Can inform of right to ask to have someone else present
  • Interview statements prepared by OFCCP
    • Often vague or incorrect
    • To correct or not correct?
    • To sign or not to sign?
    • Copies
  • Who has control over the order of interviews?
practical steps each phase of audit8
Practical Steps – Each Phase of Audit

Audit Closure

  • Compliance – formal and informal closures
  • Conciliation Agreement
    • Negotiation – some parts
    • Reporting period – almost always – 6 months to two years
  • Press release if monetary remedies
    • Not negotiable
    • Often misleading
    • Can prompt private actions
practical steps each phase of audit9
Practical Steps – Each Phase of Audit
  • Audit Closure
    • Enforcement Proceedings – if unable or unwilling to resolve
      • Solicitor’s office, not within OFCCP
      • Administrative litigation
        • Before ALJ
        • Some discovery
        • Appeal to Administrative Review Board of DOL
        • Appeal ARB decision to federal courts
      • Opportunities to settle
always be prepared the ofccp audit and enforcement survival guide1

Always be Prepared:  The OFCCP Audit and Enforcement Survival Guide

Kris D. Meade Jody Shipper

Partner Executive Director

Crowell & Moring LLP Office of Equity and Diversity

Washington, DC University of Southern California

kmeade@crowell.com jshipper@usc.edu

202.624.2854 213.740.5086