Onesource HRM

1. June 2016 Noontime Forum OnesourceHRM Gene Caudle, MBA, SPHR Managing Partner

2. Contents for Today’s Program • OFCCP – Must Know; Must Do • EEOC • OMWI • NUMBERS IN THE WORKPLACE

3. OFCCPThe Office of Federal Contracts Compliance Programs https://www.google.com/?gws_rd=ssl#q=ofccp+scheduling+letter • Compensation data must now be submitted for all employees including per diem or day laborers, temporary employees, full-time and part-time, as of the date of the workforce analysis in the contractor's AAP. The definition of compensation includes hours worked, incentive pay, merit increases, locality pay, and overtime. Additionally, other compensation or adjustments to salary (bonuses, incentive pay, commissions, merit increases, locality pay or overtime) should be identified separately for each employee. Contractors are permitted to provide additional factors used in determining compensation, such as education, past experience, location, performance, department and salary level/band/range/grade. • Personnel activity data still may be submitted by Job Group or Job Title (contrary to proposed versions). • Employment activity data (applicants, hires, promotions, and terminations) must be provided by sex and race; however, race and ethnicity information must be submitted using five specified categories instead of two broad categories (i.e., minority and nonminority). Notably, the OFCCP did not adopt EEO-1 race categories — Asian/Pacific Islander remain together and there is no "two or more races" category. It will be interesting to see what the OFCCP does with the two additional race categories. Contractors also must include in each job group or job title, applicants for whom race and/or sex is unknown. • A definition of "promotion" must be included and the basis on which it was compiled; if the definition varies for different segments in the workforce, the contractor must define the term for each segment. • Copies of reasonable accommodation policies and documentation regarding any accommodation requests and how they were resolved must be submitted. • All data must be submitted electronically if it is maintained in an electronic format that is "complete, readable and useable."

4. OFCCPThe Office of Federal Contracts Compliance Programs On March 24, 2014 OFCCP’s new regulations for veterans and individuals with disabilities went into effect. Federal contractors face a number of tasks to come into compliance with these requirements. • Conduct and document good faith outreach efforts towards employment of veterans and individuals with disabilities (You are required to keep this documentation for three years). • Required letter to ESDS and Vets representative. (See next Slide) • Ensure mandatory job listings in the manner appropriate to your Employment Service Delivery System (ESDS). • Ensure reasonable accommodations for applicants with disabilities (including online applicants).

5. OFCCPThe Office of Federal Contracts Compliance Programs The regulations state: - Updated terminology “employment service delivery system” (ESDS) • Federal contractors and subcontractors must continue to list all jobs with ESDS. • Exclusions: executive and management, internal, jobs lasting three days or less • Listing must be made “at least concurrently” with other recruitment efforts. Federal contractors must inform the nearest ESDS of its status as a federal contractor and must request referral of protected veterans. Must provide ESDS: • Information in any manner and format permitted by the ESDS • Name and location of each hiring establishment within the state • Contact information for person responsible for hiring at each establishment • Contact information for any external job search organizations used to source candidates for jobs (e.g. temp agencies). Disclosures must be made simultaneously with first listing effective March 24, 2014. Update information • Formerly “state employment service” or “state job bank” to list with the ESDS – ESDS in each state, where it has facilities when changes occur.

6. OFCCPThe Office of Federal Contracts Compliance Programs SAMPLE LETTER TO VENDORS, SUBCONTRACTORS & SUPPLIERS Dear ________________: It is the policy at (Company/Bank) to provide equal employment and advancement opportunities to all qualified individuals. To achieve this goal, (Company/Bank) is dedicated to taking affirmative action to employ and advance in employment qualified women, minorities, disabled persons, disabled veterans, and other protected veterans, in compliance with Executive Order 11246, Section 503 of the Rehabilitation Act of 1973 and Vietnam Era Veterans' Readjustment Assistance Act of 1974, as amended, 38 U.S.C. 4212 (2001) (''Section 4212'' or ''VEVRAA'') and the implementing regulations. (Company/Bank) is committed to take voluntary, positive action in providing affirmative action and equal employment opportunity to women, minorities, disabled persons, disabled veterans, and other protected veterans. All personnel actions, including compensation, benefits, recruitment, hiring, training, and promoting persons in all job titles, will be administered without regard to race, ethnicity, national origin, gender, sexual orientation, gender identification, disability, veteran, or other protected status, and all employment decisions are based solely on valid job requirements. In addition, employees and applicants are protected from harassment, threats, coercion, intimidation, interference or discrimination for: (1) Filing a complaint; (2) Assisting or participating in an investigation, compliance review, hearing, or any other activity under Executive Order 11246, Section 503 of the Rehabilitation Act of 1973, Vietnam Era Veterans' Readjustment Assistance Act of 1974, as amended, 38 U.S.C. 4212 or any other law requiring equal opportunity for disabled persons, and other protected veterans; (3) Opposing any practice made unlawful by these laws, or (4) Exercising any other right protected by these laws. As a federal government contractor, (Company/Bank) expects all of its subcontractors, suppliers and vendors to comply with all of their applicable obligations under Executive Order 11246, Section 503 of the Rehabilitation Act of 1973, Vietnam Era Veterans‘ Readjustment Assistance Act of 1974, as amended, 38 U.S.C. 4212 or any other law requiring equal opportunity for disabled persons, and other protected veterans. Further, the equal employment opportunity clauses set forth in 41 CFR 60-1.4(a), 41 CFR 60-250.5(a) and 41 CFR 60-741.5(a) are hereby incorporated by reference into all of the transactions between our companies. We appreciate your cooperation in our effort to fully comply with these Federal requirements as they may apply to your organization. Sincerely, (Name) EEO Coordinator

7. OFCCPThe Office of Federal Contracts Compliance Programs • Update AAP narratives with new definitions and regulatory citations. (Protected Vet; Gender Identification; Sexual Orientation). • Implement new self-identification procedures for employees and applicants using new forms. • Provide written notice of AAP obligations to subcontractors (60.741.44(f)). • Make EEO/Affirmative Action policy statement available in policy manual, Employee Handbook or by other means. • Perform data collection on: number of applicants, number of job openings, number of jobs filled, number of hires, number of hires that are individuals with disabilities and/or protected veterans. (This will need to be kept at least three years)

8. OFCCPThe Office of Federal Contracts Compliance Programs • Conduct a self assessment of good faith efforts (keep records for 3 years). • Review your Audit and Reporting systems (keep analysis for 3 years). • Conduct 7% utilization analysis for individuals with disabilities. • Conduct 7% hiring benchmark analysis for protected veterans. • Survey employees using new self-ID forms at least every 5 years.

9. OFCCPThe Office of Federal Contracts Compliance Programs Beginning January 1, 2016, the Executive Order 13658 minimum wage rate is increased to $10.15 per hour. This Executive Order minimum wage rate generally must be paid to workers performing work on or in connection with covered contracts.

10. OFCCPThe Office of Federal Contracts Compliance Programs • OFCCP AUDITS IN 2016 WILL CONTINUE TO BE SLOW IN PACE, FEWER IN NUMBER, CONTINUE TO FATIGUE CONTRACTORS WITH DETAILED COMPENSATION DATA REQUESTS AND ON-SITE AUDITS, ALREADY RARE, WILL LIKELY GET EVEN MORE RARE. • Two Things Have Happened to Cause OFCCP’s Unprecedented (and continuing) Audit Slowdown • OFCCP’s Compensation Fixation: Every OFCCP District manager will tell you that engaging in the current style of “deep dive” compensation audits is delaying them tremendously from closing audits; and • OFCCP’s Budget Cuts Will Now Slow Many District Offices and Audits Even Further

11. OFCCPThe Office of Federal Contracts Compliance Programs The revised OFCCP scheduling letter mandates submission of significant and detailed employee-level compensation data with the desk audit submission. Contractors must develop compliance strategies for the submission of compensation data. What elements of compensation should be collected? Total W–2 earnings; Base salary; Holiday pay; Hourly wage; Shift differential; Commissions; Stock options; and/or Any other elements of compensation (e.g., paid leave, health or retirement benefits)?

12. OFCCPThe Office of Federal Contracts Compliance Programs Contractor Poster Requirements Most federal contractors will now have new poster requirements: The “Equal Employment Opportunity is the Law” poster; The “EEO is the Law” poster supplement (both of which can be found on OFCCP’s website in English, Spanish, and Chinese); and The “Pay Transparency Nondiscrimination Provision” poster for contractors covered by Executive Order 13665. Wage And Hour (FLSA) Other State and Federal Requirements Invest in a Poster Service to guarantee poster compliance. Google: required posters for employers in Georgia for a comprehensive list of vendors.

13. EEOCEQUAL EMPLOYMENT OPPORTUNITY COMMISSION The EEO-1 Form is a report filed with the Equal Employment Opportunity Commission (EEOC), mandated by Title VII of the Civil Rights Act of 1967, as amended by the Equal Employment Opportunity Act of 1972. The Act mandates that employers report on the racial/ethnic and gender composition of their workforce by specific job categories. All employers that are located in the 50 states and the District of Columbia and have at least 100 employees are required to file EEO-1 survey annually with the EEOC. Federal government contractors and first-tier subcontractors with 50 or more employees and at least $50,000 in contracts must file as well.

14. EEOCEQUAL EMPLOYMENT OPPORTUNITY COMMISSION Pay Transparency -- What does the pay transparency rule do? As its primary purpose, the final rule protects covered federal contractors’ employees’ inquiries, discussions, and disclosures of their own pay and benefits, and similar employee activities related to the pay and benefits of others, if they obtained that information through ordinary means such as conversations with coworkers. So, for example, if a contractor has a policy that prohibits employees from talking to each other about end-of-the-year bonuses, the policy would be considered a discriminatory action under the Final Rule, as it prohibits employees from discussing their compensation. Under the final rule, it is not just pay discussions that are protected. The final rule includes a broad definition of compensation, which extends to things like salary, wages, overtime pay, shift differentials, bonuses, commissions, vacation and holiday pay, allowances, insurance and other benefits, stock options and awards, profit sharing, and retirement.

15. EEOCEQUAL EMPLOYMENT OPPORTUNITY COMMISSION Who Will Report Pay Data and When This Reporting Requirement Will Start For the 2016 EEO-1 reporting cycle, to ease the transition, all employers will submit information that is identical to the information collected by the currently approved EEO-1 (Component 1). Starting in 2017, employers that are subject to the EEO-1 reporting requirement and that have 100 or more employees will submit the EEO-1 with pay and related information (Components 1 and 2). By contrast, contractors that are subject to the EEO-1 reporting requirement and that have between 50 and 99 employees will continue to submit the same information that is collected by the current EEO-1 report (Component 1). They will not be required to submit pay and hours-worked data. A sample copy of the currently approved EEO-1 report provides an illustration of the data to be collected by Component 1. It can be found at http://www.eeoc.gov/employers/eeo1survey/upload/eeo1-2.pdf An illustration of the data to be collected by both Components 1 and 2 can be found at http://www.eeoc.gov/employers/eeo1survey/2016_new_survey.cfm .

16. EEOCEQUAL EMPLOYMENT OPPORTUNITY COMMISSION Employers would identify employees' total W-2 earnings for a 12-month period looking back from a pay period between July 1st and September 30th. W-2 earnings are useful for assessing pay discrimination because they include not only wages and salaries, but also other compensation such as commissions, tips, taxable fringe benefits, and bonuses. Most employers' existing HRIS and pay systems include W-2 earnings data elements. HRIS systems generally allow the calculation of W-2 earnings for any 12-month period, and not just for the calendar year. The EEO-1 would use aggregate pay for a 12-month period looking back from a pay period between July 1st and September 30th of the reporting year, as selected by the employer. For example, an employer could use aggregated W-2 data for the twelve months looking back from the second pay period in July of the reporting year. The proposal also would account for part-time workers, those who worked less than a full 12 months, and workers with W-2s from multiple employers. It would do so by collecting the number of hours worked by the employees counted in the pay bands.

17. EEOCEQUAL EMPLOYMENT OPPORTUNITY COMMISSION The pay bands track the 12 pay bands used by the Bureau of Labor Statistics in the Occupation Employment Statistics survey: (1) $19,239 and under; (2) $19,240 - $24,439; (3) $24,440 - $30,679; (4) $30,680 - $38,999; (5) $39,000 - $49,919; (6) $49,920 - $62,919; (7) $62,920 - $80,079; (8) $80,080 - $101,919; (9) $101,920 - $128,959; (10) $128,960 - $163,799; (11) $163,800 - $207,999; and (12) $208,000 and over.

18. OMWIOFFICE OF WOMEN AND MINORITY INCLUSION • The standards focus on five areas: • Promoting Organizational Commitment to Diversity and Inclusion; • Evaluating and Improving Workforce Profiles and Employment Practices; • Improving Procurement and Business Practices Related to Supplier Diversity; • Promoting Practices that Make Workforce and Supplier Diversity and Inclusion Efforts Transparent and Public; and • Conducting Annual Self-Assessments and Disclosing Related Information

19. OMWIOFFICE OF WOMEN AND MINORITY INCLUSION https://www.fdic.gov/about/diversity/2016plan.html Workforce Diversity Goal 1: The FDIC will recruit from a diverse, qualified group of potential applicants to secure a high-performing workforce drawn from all segments of U.S. society.

20. OMWIOFFICE OF WOMEN AND MINORITY INCLUSION https://www.fdic.gov/about/diversity/2016plan.html Workforce Inclusion Goal 2: The FDIC will cultivate a culture that encourages collaboration, flexibility, and fairness to enable individuals to contribute to their full potential and to improve retention.

21. OMWIOFFICE OF WOMEN AND MINORITY INCLUSION https://www.fdic.gov/about/diversity/2016plan.html Sustainability Goal 3: The FDIC will develop structures and strategies to equip leaders with the ability to manage diversity, measure results, refine approaches on the basis of such data, and institutionalize a culture of inclusion.

22. NUMBERS IN THE WORKPLACE The standard deviation of a sample is known as S and is calculated using: Where x represents each value in the population, x is the mean value of the sample, Σ is the summation (or total), and n-1 is the number of values in the sample minus 1. The use of statistical analysis in the workplace is emerging as a critical tool for compliance audits and HR self-evaluation as a defense against Government intrusion.

23. NUMBERS IN THE WORKPLACE Statistics can have various uses in a compensation case. Statistical evidence can help determine if there is a broad pattern of intentional discrimination, i.e., whether intentional discrimination is the respondent's "standard operating procedure." If the scope of the investigation is narrower, statistics still can help determine whether an individual has suffered from intentional discrimination in compensation. Statistics also are useful for determining whether a neutral compensation policy or practice has an adverse impact on members of a protected group. This subsection explains one approach to investigating compensation practices using an analytical tool known as statistical inference. It allows one to determine whether differences between a protected class target group and a comparison group are "statistically significant," i.e., whether the difference could not be expected to have occurred by chance. This differs from the basic comparison of raw numbers or percentages, which is known as descriptive statistics. Statistical inference helps ensure consistent decision-making, whereas the meaning of descriptive statistics may be interpreted differently by different individuals. EEOC COMPLIANCE MANUAL SECTION 10: COMPENSATION DISCRIMINATION

24. NUMBERS IN THE WORKPLACE Work Product may be protected by attorney-client privilege!!

25. GCAUDLE@ONESOURCEHRM.COM Gene Caudle, Managing Partner OnesourceHRM 3575 Piedmont Rd NE Suite 1030 Atlanta, GA 30305 770-354-1530 440-991-7341