The OFCCP Issues a Flurry of Directives and Other Resources

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It has been an exceptionally busy month at the Office of Federal Contract Compliance Programs (OFCCP), which released five Directives and a publication entitled “What Federal Contractors Can Expect,” as well as announcing a new “Contracting Officer Corner” webpage of resources. Directives provide guidance to OFCCP staff or federal contractors on enforcement and compliance policy or procedures, but do not establish legally enforceable rights or obligations. We summarize these documents as follows:

  • DIR 2018-03 Religious Exemption – Pointing to a trio of Supreme Court decisions that protect religious exercise under the Constitution and federal law, as well as several Executive Orders issued by President Trump that defend religious exercise, this directive is intended to safeguard the rights of “religion-exercising” federal contractors. The agency’s staff are directed to take these developments into account when providing compliance assistance, processing complaints, and enforcing Executive Order 11246, by keeping the following in mind:
    • They “cannot act in a manner that passes judgment upon or presupposes the illegitimacy of religious beliefs and practices” and must “proceed in a manner neutral toward and tolerant of . . . religious beliefs.”
    • They cannot “condition the availability of [opportunities] upon a recipient’s willingness to surrender his [or her] religiously impelled status.”
    • “[A] federal regulation’s restriction on the activities of a for-profit closely held corporation must comply with [the Religious Freedom Restoration Act].”
    • They must permit “faith-based and community organizations, to the fullest opportunity permitted by law, to compete on a level playing field for . . . [Federal] contracts.”
    • They must respect the right of “religious people and institutions . . . to practice their faith without fear of discrimination or retaliation by the Federal Government.”
  • DIR 2018-04 Focused Reviews of Contractor Compliance – The OFCCP announced that it will add “focused reviews” to its compliance activities. This involves comprehensive on-site audits regarding the contractor’s compliance with one of the particular enforcement authorities under its jurisdiction: Executive Order 11246 (women and minorities), Section 503 of the Rehabilitation Act of 1973 (disabled individuals), and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (protected veterans).
  • DIR 2018-05 Analysis of Contractor Compensation Practices During a Compliance Evaluation – Replacing prior DIR 2013-03, this directive outlines the OFCCP’s standard procedures for reviewing contractor compensation practices during a compliance evaluation. It explains the agency’s approach to determining similarly-situated employees, creating pay analysis groups, and conducting statistical analysis and modeling, among other things. The OFCCP believes this guidance will also allow contractors to conduct more effective self-auditing, as they are required to do by regulation. The OFCCP issued Frequently Asked Questions regarding this Directive.
  • DIR 2018-06 Contractor Recognition Program – In order to encourage contractor compliance, the OFCCP will create a recognition program for “innovative thought leaders” in the contractor community to highlight best or model practices, and a mentoring program to assist peers improve compliance, as well as other unspecified initiatives.
  • DIR 2018-07 Affirmative Action Program Verification Initiative – The OFCCP is establishing a program to verify compliance by all contractors with their affirmative action program (AAP) requirements, which include the development of an AAP within 120 days of the contract and annual updates. The program will include the following:
    • Annual certification of compliance with AAP requirements by contractors.
    • Revising the neutral scheduling methodology to increase the likelihood of compliance reviews for contractors that failed to provide certification.
    • Compliance checks to verify contractor compliance with AAP requirements.
    • Requesting the AAP from contractors that request extensions of time to provide support data in response to a scheduling letter for a compliance review.
    • Eventually, the annual collection of AAPs from federal contractors.
  • What Federal Contractors Can Expect – This document sets forth the general expectations that are intended to guide the interactions between the OFCCP and federal contractors. While the document provides further elaboration on each expectation, they are listed as follows:
    • Access to accurate compliance assistance material.
    • Timely responses to compliance assistance questions.
    • Opportunities to provide meaningful feedback and collaborate.
    • Professional conduct by OFCCP’s compliance staff.
    • Neutral scheduling of compliance evaluations.
    • Reasonable opportunity to discuss compliance evaluation concerns.
    • Timely and efficient progress of compliance evaluations.
  • Contracting Officer Corner – The OFCCP has created a new online central repository of resources for both federal agency contracting officials and federal contractors. The resources  include a new pre-award process guide, downloadable workplace posters, a link to the applicable regulations, and notice and training links, as well as registries of both contractors who are exempt from the pre-award clearance process and those who are debarred from receiving federal contracts.