OFCCP’s New Audit Strategy: Management to Enforcement

by Irwin, Esq., Carla Wednesday, April 27, 2011
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It’s that time of year again, the Office of Federal Contract Compliance Programs (OFCCP) has sent out its Corporate Scheduling Announcement Letters. This year however, the OFCCP discontinued its previous compliance evaluation strategy of Active Case Management (ACM) and rang in the new year with a new directive, Active Case Enforcement (ACE). The title alone should give you insight into the direction the OFCCP will be taking with audits this year.

Out with the Old
The old ACM strategy was focused on systemic discrimination and used an abbreviated desk audit process that closed reviews if there were no indicators of discrimination in groups of ten or more. A full desk audit was performed every 25th review and an onsite evaluation every 50th review. Here is what Patricia Shiu had to say about the old strategy: “While ACM has identified a number of systemic cases since its implementation, it has also caused OFCCP to narrow the focus of its enforcement efforts and has eroded OFCCP's enforcement authority.”

In with the New
The new ACE directive certainly moves the agency from managing compliance evaluations to enforcing them. Here are the highlights:
  • • Full desk audit for every compliance review (EO 11246, Section 503, VEVRAA)

  • • Full compliance review every 25th review (includes on-site)

  • • Three years compliance history review of employment agencies including OFCCP, EEOC, WHD, OSHA and State/Local Fair Employment Practice (FEP)

  • • Indicators of discrimination include both individual and class (two or more)

  • • Where onsite is conducted, compliance with EO 13496 is evaluated

  • • OFCCP will use its full arsenal of compliance evaluation tools: compliance check, focused review, off-site review of records, etc.

  • • Items that trigger an on-site review
    • ◦ Patterns of individual discrimination
    • ◦ Patterns of systemic discrimination
    • ◦ Patterns of major technical violations
    • ◦ Non-compliance with other labor and employment laws
    • ◦ If AAP and supporting documentation is insufficient to determine compliance
    • ◦ Every 25th review
In Preparation
Knowledge is power. When you receive a scheduling letter, contact the compliance officer and ask if this a 25th review, that way you can prepare for an onsite from the beginning of the audit. Review your AAP and supporting documents prior to submission for both individual and system discrimination along with technical compliance. Be sure to submit not only complete and accurate information, but highlight your good faith efforts. Finally know your three year history with federal, state and local employment agencies.