Construction Contractors Beware: What To Do When the OFCCP Comes Knocking

If you are a government contractor or subcontractor, you may be subject to various affirmative action obligations whether you know it or not. The Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) is tasked with enforcing these affirmative action obligations.

The OFCCP continues to increase its enforcement efforts, particularly in the construction industry. During the Obama administration, the OFCCP has doubled the number of compliance evaluations for construction companies. The OFCCP will continue to target the construction industry because reports show that construction companies are more likely to be in violation of the affirmative action obligations.

Are you a construction contractor? If you have a federal construction contract or subcontract over $10,000, you must comply with certain affirmative action requirements. Bid solicitations and the underlying contracts for these projects are required to advise you of these requirements. Oftentimes, these important provisions are overlooked because they are hidden among the boilerplate language.

What happens if you are selected for a compliance evaluation? The OFCCP typically mails you a scheduling letter requesting that you submit certain documentation relating to affirmative action compliance and compensation data within thirty days. This is commonly known as the “desk audit” phase of a compliance evaluation.

If the results of the desk audit indicate potential discrimination or non-compliance, the OFCCP will conduct an on-site audit, which may include requesting additional data, inspecting your facilities, interviewing your employees, etc. Take advantage of the fact that legal counsel can be present at the facility inspection as well as during interviews with management.

It is imperative to begin preparing for the compliance evaluation immediately upon receiving the scheduling letter. Prior to submitting any documentation to the OFCCP, make sure that you have carefully reviewed it and that you are prepared to provide explanations for pay discrepancies and/or affirmative action efforts.

What is the OFCCP looking for? As a construction contractor, you are required to demonstrate good faith efforts to comply with goals established for employing women and minorities. The OFCCP will not penalize you for not employing a certain percentage of minorities and/or females – however, it will focus on your outreach and recruitment efforts as well as other affirmative action obligations. The OFCCP will also closely analyze your hiring and pay practices to ensure that they are not discriminatory.

Be proactive. Now is the time to conduct a self-audit of your recruitment, hiring and pay practices to ensure that you are in compliance with the affirmative action obligations. The cost of non-compliance can be costly and may even prevent you from receiving any more federal contracts or subcontracts. Don’t risk it – make sure that you are in compliance now.

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These articles are provided for general informational purposes only and are marketing publications of Gentry Locke. They do not constitute legal advice or a legal opinion on any specific facts or circumstances. You are urged to consult your own lawyer concerning your situation and specific legal questions you may have.