Tag: OFCCP

Drafting an Affirmative Action Plan

Published by Brett Holubeck on March 19, 2020

What is an affirmative action plan? Do you need one? The answer is maybe. Certain federal contractors and subcontractors are required to maintain affirmative action plans. Affirmative action plans (AAP’s) are essentially a plan that allows companies to address workplace imbalances by proactively hiring and promoting disadvantaged groups in the workforce. The federal government also requires these contractors to maintain certain data regarding the composition of their workforce.

Why is this important? Short Answer: Not Complying Will Cost You

If you don’t yet have one, you will likely want to get one or the result could be some hefty fines. Over the last three years the Office of Federal Contract Compliance Programs (OFCCP, which is the agency that enforces the affirmative action plan requirements) collected $81 million dollars in fines which is the highest three-year period on record. In addition, the OFCCP audits for the three-year period covered 2.8 million workers.

Currently, the OFCCP is creating an online portal where federal contractors and subcontractors will submit their affirmative action plans, which will increase the ability of the OFCCP to audit and fine companies. Once this portal is completed, then companies should expect fines to increase and companies that may not have been audited before could be audited. Currently, contractors are not required to turn in their plans to the federal government, a reality that will likely change with the new portal. When and if it does, the OFCCP will be able to run checks on the data that companies are required to submit through the portal to see if there are any areas of concern. To be proactive, now is the time for companies to act and ensure that they are compliant and to get the procedures that they need in place.

What Does the Law Say?

The laws governing affirmative action plan requirements are: 1) Executive Order 11246; 2) Vietnam Era Veterans Readjustment Assistance Act (VEVRAA); and 3) Section 503 of the Rehabilitation Act of 1973.

Executive Order 11246 (the main requirements for Affirmative Action Plans are from this order)

Under Executive Order 11246, federal contractors and subcontractors with a federal contract for at least $50,000 and 50 or more employees must develop and keep a formal, written affirmative action plan.

There are several exemptions that the DOL lists for federal contractors that are subject to Executive Order 11246:

Contracts and subcontracts of less than $10,000 generally are exempt from coverage under Executive Order 11246, though some contracts under that amount are covered, e.g. bills of lading. The regulations implementing the Executive Order exempt certain contracts and categories of contracts. The regulations contain exemptions for contracts involving work performed outside the United States; certain contracts with State or local governments; contracts with religious corporations, associations, and educational institutions; and contracts involving work on or near an Indian reservation.

Section 503 (which involves requirements for the employment and recruitment of individuals with disabilities)

Under Section 503 federal contractors and subcontractors with government contracts in excess of $15,000 are required to take affirmative action to employ and advance in employment qualified individuals with disabilities. “If the company has at least 50 employees and a single contract of $50,000 or more, then it must also develop a Section 503 AAP” https://www.dol.gov/ofccp/taguides/jurisdiction.htm Section 503 applies to businesses that have federal construction contracts, but does not apply to any business that has a federally assisted construction contract.

Vietnam Era Veterans’ Readjustment Assistance Act of 1975 (which details requirements for the employment and recruitment of veterans)

Under VEVRAA, federal contractors and covered subcontractors with contracts that total $150,000 or more and 50 or more employees must have a written AAP but need not have the in-depth statistical analyses required by E.O. 11246. VEVRAA also does not apply to federally assisted contracts.

Required Demographic and Other Information

Companies need to gather the name, gender, race, job, worksite, job code, salary, zip code, city, state, employee identifier (id #), hire date, veteran status, disability status, and other information concerning the employees within a snapshot period (one day during the dates of the affirmative action plan). You should use the demographic information from the information that applicants have voluntarily disclosed through the application process. The current plan year always uses information from last year (the 2020 plan would use information from 2019).

As an example, the information used to build your 2020 plan may be from January 1, 2019 to December 31, 2019 (your plan may have different dates depending on when your federal contract began and the date that you initially chose for your plan). The information for the employee portion of the affirmative action plan will be drawn from December 31, 2019. You will gather the relevant data for all people that were employed by your company on that date. You will not use data for other employees that worked for you throughout the year.

Federal contractors also must maintain information on all hires for the relevant plan year including information about their name, gender, race, job, worksite, job code, salary, disability status, veteran status, and hire date.

Employers must also maintain the same information for the individuals that have applied to work at the company (including the positions that they have applied to), terminations at the company (including whether the termination was voluntary or involuntary and the termination date), and anyone that was promoted (including their new and old job titles and their promotion date). All of this information is used for the statistical analysis of the workforce.

EEO-1 Categories and Affirmative Action Plans

To create an affirmative action plan, employees need to create a list of the number of employees (they also need demographic information about them) and categorize the employees into the appropriate EEO-1 categories. The categories are as follows:

Executive/Senior Level Officials and Managers.
First/Mid-Level Officials and Managers
Professionals
Technicians
Sales
Administrative
Craft
Operatives
Laborers and Helpers
Service Workers

If you need help classifying your workers, then you can review the information available on the EEOC website.

Types of Reports that Must be Run under E.O. 11246

Companies that are federal contractors and subcontractors must run a number of statistical tests using the data described above. In general, the required elements of an AAP include an Organizational display, a Workforce analysis (comparison of each job title by pay with race and gender information), a Job group analysis (analysis of groups of workers with similar duties, responsibilities, pay, and opportunities to improve their career and pay), Utilization analysis (statistical determination of the percentage of minorities and women that are employed in each job group compared to their availability in the area), Availability determinations, Action-Orientated program (how the federal contractor will correct any disparities in hiring or promotions), and several other detailed provisions as required by the regulations.

The statistical analyses to conduct an affirmative action plan results in a determination on whether the employer hires, terminates, and promotes enough employees in various protected groups. It can almost be better expressed in whether the company fails to hire, more frequently terminates, and/or does not promote enough applicants or employees with a certain race, gender, veteran status, or disability status.

These reports typically examine the local area (by zip code(s)) and possibly the national area to determine whether a company has hired enough of different group members based on the available pool of applicants.

Correcting Disparities in an Affirmative Action Plan

As part of the AAP requirements, federal contractors are required to create an action-oriented program to correct disparities. No plan will be perfect the first time, and businesses can and should learn from their data to improve their plans each year.

Companies are required to have an internal audit system to determine whether the AAP is effective in correcting any problem areas and how it can be adjusted to better do so. There are a number of ways that companies can correct disparities in a workforce. I will talk about this briefly below.

The first component of correcting disparities is to make sure that you are keeping the right data. If you are a federal contractor, then you need to keep data regarding hires, promotions, and terminations. However, it is not enough to merely keep that data, you need to make sure that you are keeping track of the data and making changes to your practices based on it. For example, if you have 200 applicants for 40 professional positions, half of them are men, and you have never hired any female candidates, then that is a problem. It looks suspicious and it calls into question whether there is some purposeful discrimination or if it is a disparate impact on applicants of a particular gender. In this case, you obviously need to determine whether there is some form of hiring bias in the organization and potentially find ways to recruit additional female candidates through targeted recruitment methods. This would hold true of any group that is underrepresented in a certain job group.

If you do not have veterans in your organization, then you should consider advertising that may attract more candidates that are veterans. Here are some places to post jobs to try to recruit veterans, but you can read more in my past article on veterans.

The most important thing is that the federal contractor takes actual steps to correct any disparities among groups. Companies should make sure that there are changes in the action-oriented program every year. A plan that has had the same action-oriented program every year is a bad plan. You need to review your plans, work with your recruitment team, and make changes yearly.

Conclusion

Affirmative action plans are something that all federal contractors and subcontractors need to carefully consider. They can be an excellent way for companies to review their promotions, recruitment, and termination statistics to determine where any disparities exist. Companies also benefit from understanding and reviewing what recruitment methods work to find the best candidates and new hires for their companies.

The information provided in this blog is for educational purposes only and is not legal advice. If you need legal advice, then you should speak with a lawyer about your specific issues. Every legal issue is unique. A lawyer can help you with your situation. Reading the blog, contacting me through the site, emailing me or commenting on a post does not create an attorney-client relationship between any reader and me.

The information provided is my own and does not reflect the opinion of my firm or anyone else.

Veterans in the Workplace

Published by Brett Holubeck on November 11, 2019

It’s Veterans Day. A great day to honor all those that have served our country in the military. For employment lawyers, businesses, and Human Resource professionals, it is a great time to review some of the special requirements of employing veterans.

The Benefit of Employing Veterans

Companies love veterans. The Center for Talent Innovation found that efforts to hire veterans can “consume as much as 20 or 30 percent of recruiting budgets at some large corporations.” There are a number of reasons for the efforts that these companies put forth to hire veterans.

First, military veterans often gain valuable skills while they perform their service. Sometimes these are hard skills like working on airplanes, coding various programs, and engineering. Oftentimes, it is the soft skills that are gained through military service. Typical Army training includes a lot of activities that help improve discipline, communication and working with a team, and a ton of confidence through overcoming obstacles. All of these are transferable to the workplace.

Of course, some of this recruitment may be due to requirements for federal contractors and subcontractors. The Office of Federal Contract Compliance Programs requires these companies to make special efforts to recruit veterans as part of the requirements to complete affirmative action plans.

One other advantage is that employers can receive a tax credit for hiring veterans (it is going to potentially go away if it is not renewed by December 2019). Employers can get $1,500-$9,600 in tax credits for the first year of their employment.

Possible Disability Issues

Many companies that employ veterans have concerns about PTSD and other disabilities that affect many veterans. About twenty-nine percent of recent veterans report having a service-connected disability. This compares to the nearly one in five people in the US (approximately 56.7 million people) that have a disability. A quick reminder, most disabilities are relatively easy to accommodate. Two-thirds of disabilities require less than $500 to accommodate and one quarter cost nothing at all. Having a disabled person can even be an advantage in the workplace as they may bring a different and often valuable perspective that would otherwise be missed. And after all, what would the world be without Beethoven’s Ninth Symphony (composed when he was almost completely deaf), the music of Stevie Wonder and Ray Charles who were both blind, the inspirational story of Helen Keller (who as a deaf-blind woman lived a fascinating life and graduated from college nearly 90 years before the Americans with Disabilities Act was passed), and the challenges Franklin Delano Roosevelt faced from polio. The possibility of a disability should not deter companies from hiring veterans unless they cannot perform the job duties even with an accommodation.

PTSD and Veterans

One of the biggest challenges many companies face in employing veterans is Post-traumatic Stress Disorder (PTSD). PTSD is not limited to individuals in the military but can affect anyone. It affects approximately 3.5 percent of U.S. adults, and an estimated 1 in 11 people will be diagnosed PTSD in their lifetime. Studies have shown that around 11% to 20% of combat veterans have PTSD.

A person develops PTSD when they are directly exposed to death, threatened death, serious injury, or sexual violence. A person with PTSD has intense and disturbing thoughts that recur long after the traumatic incident that caused them ends and seeks to avoid any triggers that remind them of the traumatic event. These experiences can range from flashbacks; nightmares; intense sadness, fear or anger; and a sense of detachment from the world and other people. People with PTSD often seek treatment through therapy and medication.

How can employers accommodate PTSD at work? JAN has a great list of questions to consider to accommodate these individuals:

What limitations is the employee experiencing?
How do these limitations affect the employee and the employee’s job performance?
What specific job tasks are problematic as a result of these limitations?
What accommodations are available to reduce or eliminate these problems? Are all possible resources being used to determine possible accommodations?
Has the employee been consulted regarding possible accommodations?
Once accommodations are in place, would it be useful to meet with the employee to evaluate the effectiveness of the accommodations and to determine whether additional accommodations are needed?
Do supervisory personnel and employees need training?

Common accommodations for these individuals can include a flexible schedule and a modified break schedule. Employees with PTSD may be eligible for leave under the FMLA and the ADA. They may be eligible for intermittent leave under the FMLA based on the medical diagnosis of their doctors. As is common with accommodations, accommodating an individual with PTSD is likely a cost neutral accommodation (the accommodations involve changes to the workplace that do not require the employer to spend money, such as by purchasing special equipment, to accommodate the employee and allow them to work).

Service Dogs

Service animals cause many companies to panic. Many people have read about pets being claimed to be service animals when they lack any sort of training and are concerned about bringing animals into the workplace. However, services animals can be integrated into most workplaces relatively easily.

As with any other request for an accommodation (and assuming that the ADA applies), an employer needs to go through the interactive process with the employee to accommodate their request. I’ve written about that here.

JAN has a great explanation of how to assess whether to allow these animals in the workplace as an accommodation.

What this means for employers: When an employee with a disability requests to use a service animal at work, you have the right to request documentation or demonstration of the need for the service animal (when the need is not obvious) and that the service animal is appropriately trained and will not disrupt the workplace. However, while documentation demonstrating that an employee has a covered disability may come from a health care provider, you may need to consider documentation from other sources that explains the need for the service animal and that shows the animal is appropriately trained. Another option is to have a trial period; allow the employee to bring in the service animal on a trial basis to see if allowing the animal is effective and does not pose an undue hardship. There is no set time frame for a trial period, but one to six weeks might be enough time to assess the situation.

What this means for employees: In addition to documenting they have a disability, employees who use service animals need to be able to show that the service animal is needed for disability-related reasons and that the service animal is trained to be in a work environment without disrupting the workplace or otherwise behaving inappropriately. If your doctor recommended the service animal, then your doctor should be able to verify that you need the service animal for disability-related reasons. Regarding your service animal’s training, in some cases documentation from the service animal trainer would be helpful. In other cases, you may want to offer to demonstrate how the service animal behaves in the workplace.

Service dogs can serve a variety of functions including helping those with autism, individuals that are hard of hearing, limited mobility, diabetics, individuals with allergies, and those with a disease or condition that causes seizures, PTSD, and other issues. Many people fail to recognize that an individual with a service animal may have an “invisible” health issue that the dog is meant to accommodate or help with.

If there is an employee that is allergic to dogs, then the company should work with that individual to address the issue. Possible solutions can include ensuring that the service animal and the employee with allergies work in different parts of the building, that they have a different pathway to areas of the building than the service animal, and the use of portable air filters.

Of course, service animals may not be able to work in all environments and it may not be possible to accommodate an individual with a service animal. Anyone that must work in a sterile environment (think surgery) may not be able to have a service animal while they are in that area, places where food is prepared or food processing plants in the areas where the food is made (they must still be permitted in cafeterias and dining areas), and anywhere else where they may not be able to physically go (places that can only be accessed by ladders, etc.).

Where to Recruit Veterans

As I mentioned, many companies actively seek veterans. So where are the best places to recruit veterans?

There are a number of sites that aim to help companies recruit veterans.
- https://recruitmilitary.com/
- https://www.hireheroesusa.org/companies/
- https://hireveterans.com/
- https://www.mynextmove.org/vets/
Many American Job Centers have a veterans and military transition center representative for veterans and companies that wish to hire them.
The American Legion and Recruit Military offer career fairs for veterans
Finally, and most importantly, establishing your organization as an organization that values veterans, reserve duty members, and other military personnel is probably the best way to hire veterans. Word of mouth is still one of the best ways to hire. One survey by SurePayroll Inc. found that small business owners preferred word of mouth referrals with 70% of small businesses using word of mouth to hire individuals compared to 37% that use job websites (companies can use more than one method to recruit).

Conclusion

Veterans have a lot to offer companies through the valuable training that they gained through their military service. There are a number of resources to help veterans find jobs, and there are a lot of resources to help employers interested in benefitting from the soft and hard skills many military members possess as a result of their service.

Lastly – Happy Veteran’s Day! Thank you so much to those of you who have served our country. We are thankful to have individuals like you who are willing and able to serve!

The information provided is my own and does not reflect the opinion of my firm or anyone else.