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Preparing for OFCCP Compliance: Current Trends
November 05, 2013
Overview of Biddle Consulting Group, Inc.Affirmative Action Plan (AAP) Consulting and
Fulfillment
• Thousands of AAPs developed each year• Audit and compliance assistance
• AutoAAP™ Enterprise software
HR Assessments
• AutoGOJA™ online job analysis system
• TVAP™ test validation & analysis program• CritiCall™ pre-employment testing for 911 operators
• OPAC™ pre-employment testing for admin professionals• Video Situational Assessments (General and Nursing)
Custom Test Development
& Validation
•“High stakes” test development
•Validation studies in response/prevention to litigation
EEO Litigation Consulting
/Expert Witness Services
• Over 200+ cases in EEO/AA (both plaintiff and defense)
• Focus on disparate impact/validation cases
Compensation Analysis• Proactive and litigation/enforcement pay equity studies• COMPare™ compensation analysis software
Publications/Books• EEO Insight™: Leading EEO Compliance Journal
• Adverse Impact (3rd ed.) / Compensation (1st ed.)
BCG Institute for Workforce Development
• 4,000+ members• Free webinars, EEO resources/tools
Speaking and Training • Regular speakers on the national speaking circuit
Biddle Consulting Group, Inc.
193 Blue Ravine, Suite 270
Folsom, CA 95630
916.294.4250
www.biddle.com | www.bcginstitute.org
Nina Le-Tse ([email protected] )
Jeff Davies ([email protected] )
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CONTACT INFORMATION
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1.
The Audit Letters Keep Coming…
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• OFCCP’s Fiscal Year began October 2013
– Audit letters continue to arrive from previous fiscal
year
• CSAL/Audit letters received in heavy doses
during December 2012
• Second batch of CSAL/Audit letters sent out the
end of March 2013
– A few requests for extension have been granted;
most continue to be denied
1. The Audit Letters Keep Coming…
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• CSAL’s are now being received by the actual
location (no longer by HQ)
- CO’s typically give a courtesy call to let the
location know that the official letter is coming
- It is also a way for the CO to confirm that the
address is correct
- More recent audit letters bear a tracking
number
1. The Audit Letters Keep Coming…
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2.
Updated Census Data
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• Release of “2010” Census EEO tabulation on
November 29, 2012.
– Posted on the American Fact Finder webpage (http://factfinder2.census.gov)
• Notice given in May 2013 that all AAP’s created
on or after January 1, 2014 must utilize new data
– Updated data may be used immediately
– Crosswalk available to help contractors with
transitioning
2. Use of Updated Census Data
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3.
More Adverse Impact Scrutiny
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3. More Adverse Impact Scrutiny
Findings of Violation (2004-2011)
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2004-2007 data provided by the Center for Corporate Equality 2012
2008-2013 data provided by USDOL (http://ogesdw.dol.gov/search.php)
Hiring Promotion Termination Selection Salary Total
Year (#) (%) (#) (%) (#) (%) (#) (%) (#) (%) (#) (%)
2004 50 87.7% 0 0.0% 1 1.8% 1 1.8% 5 8.8% 57 100.0%
2005 41 80.4% 0 0.0% 0 0.0% 1 2.0% 9 17.6% 51 100.0%
2006 61 87.1% 0 0.0% 0 0.0% 3 4.3% 6 8.6% 70 100.0%
2007 57 86.4% 0 0.0% 0 0.0% 5 7.6% 4 6.1% 66 100.0%
2008 72 76.6% 4 4.3% 3 3.2% 8 8.5% 7 7.4% 94 100.0%
2009 79 79.0% 2 2.0% 0 0.0% 11 11.0% 6 6.0% 100 100.0%
2010 66 64.1% 4 3.9% 2 1.9% 6 5.8% 18 17.5% 103 100.0%
2011 83 57.2% 11 7.6% 9 6.2% 12 8.3% 30 20.7% 145 100.0%
2012 94 57.3% 10 6.1% 9 5.5% 14 8.5% 43 26.2% 164 100.0%
2013 18 42.9% 6 14.3% 3 7.1% 3 7.1% 12 28.6% 42 100.0%
Total 621 69.6% 37 4.1% 27 3.0% 64 7.2% 140 15.7% 892 100.0%
• OFCCP continues to rely upon group with
highest selection rate as reference group, not just
the historically advantaged group.
–Any groups can be compared (Asians vs. Whites,
Blacks vs. Hispanics, etc.)
o ALJ decision on August 5, 2013 sets limits on aggregating for analyses.
–Highest selection rate is not always the most appropriate analysis!
3. More Adverse Impact Scrutiny
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Traditional
3. More Adverse Impact Scrutiny
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Group with Highest Selection Rate
Be Careful! Is the group with the Highest Selection Rate truly the
appropriate reference group?
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More Appropriate Reference Group
3. More Adverse Impact Scrutiny
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CFR 60-3.15A(2)(a) and UGESP Q&A # 16
“Q16. Should adverse impact determinations be made for all groups
regardless of their size?
A. No. Section 15A(2) calls for annual adverse impact determinations to be made for each
group which constitutes either 2% or more of the total labor force in the relevant labor area,
or 2% of more of the applicable workforce. Thus, impact determinations should be made
for any employment decision for each group which constitutes 2% or more of the labor force
in the relevant labor area. For hiring, such determination should also be made for groups
which constitute more than 2% of the applicants; and for promotions, determinations
should also be made for those groups which constitute at least 2% of the user's workforce.”
• Compliance Officers are starting to ask for
“internal audit reports” (i.e. adverse impact
analyses and compensation analyses)
–Previously not standard practice, yet within their reach!
o “Self-monitoring techniques” are required; now the OFCCP
wants to see them
–Huge concern for contractors in doing self-evaluations
o “Will this be used against me?”
o Are the analyses properly run?
3. More Adverse Impact Scrutiny
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4.
Basic Math is Revived
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4. Basic Math is Revived
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Hires, Terms, Promos
This Year’s WF
Last Year’s WF
– Does not take into consideration transfers, demotions and other movements within the organization
– It will be up to the contractors to provide really good explanation/documentation to support the data included in the
AAP
– Reconcile the data!
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5.
Directive 307
Compensation Analysis Impact
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5. Directive 307
Compensation Analysis Impact
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• Directive 307
–Effective upon release February 28, 2013
– Previous standards and guidelines were also
rescinded as “too restrictive”
–Articulated OFCCP’s widened approach in
evaluations of compensation
o A variety of tools used on a case-by-case basis
o Systemic, small group, and individual discrimination
o Contractor-supplied factors explaining differences in pay
will be reviewed, and may be rejected
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5. Directive 307
Compensation Analysis Impact
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• Directive 307
–Pay Analysis Groups
o Job groups, job titles, units, categories or other
unspecified groupings used to evaluate compensation
o OFCCP may choose to define groupings themselves!
• Variables “statistically controlled”
o Document all factors used in determining compensation
• OFCCP is soliciting and using this information in evaluations
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5. Directive 307
Compensation Analysis Impact
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Pay Analysis Group Examples
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Across 40 Locations
OFCCP gains
statistical power
using contractor’s
job titles!
Sizeable
differences across
job titles!
5. Directive 307
Compensation Analysis Impact
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• Will the OFCCP be successful in
implementing these changes?
–Possibly, but not right away
o Must acquire/train more qualified statisticians for analyses
o Systems and techniques are being implemented and
refined
–Contractors are still left with navigating murky
audits now!
o Be prepared for lengthy audits (1-2 yrs) and increased costs to explain your practices
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6.
New Regulations
(Persons with Disabilities and Covered Veterans)
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6. New Regulations (503 & 4212)
• April 2011: Notice of Proposed Rulemaking –
Veterans (final rule sent to OMB July 30, 2013)
– Significant changes to outreach/recruitment/record
retention
– Self-identification of “Protected Veterans” pre-offer
– New quantitative analyses to include hiring goals
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6. New Regulations (503 & 4212)
• December 2011: Notice of Proposed
Rulemaking – Individuals with Disabilities (final
rule sent to OMB July 31, 2013)
– Significant changes to outreach/recruitment/record
retention
– Hiring goals of ~7% per job group within each AAP
– Self-identification pre-offer
– New quantitative analyses of applicants, hires,
workforce
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• New Regulations for Persons with Disabilities
and Covered Veterans published Sept. 24, 2013.
– Systems must be ready to track by March 24, 2014.
– Reports are required in the next reporting cycle following one year of data collection.
• 8% Hiring benchmark for Covered Veterans
• 7% Utilization goal for Persons with Disabilities
2. New Regulations (503 & 4212)
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7.
OFCCP Requests During Audit
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7. OFCCP Requests During Audit
• Resubmit compensation data to include job
groups or pay bands; include any other factors
used by the federal contractor to determine pay
• Submission of self-monitoring reports (i.e.
adverse impact and compensation analyses)
• Job Group Analysis from previous year
• Copy of contractor’s FMLA policy
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7. OFCCP Requests During Audit
• Copy of filed EEO-1 reports
• Copy of VETS-100/100A reports
• Evidence of outreach
• Evidence of job openings being posted
• Copy of contractor’s policy regarding
background checks
• EEOC recently changed its policy on use of criminal history
in the selection process
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7. OFCCP Requests During Audit
• Some CO’s started sending out confidentiality
letters to contractors
• Some CO’s are asking for mid year employee file
• At least in one region: CO’s are instructed to ask
for the same data/information for all audited
locations within the same organization
• OFCCP is looking to consolidate audits from an
organization to a single CO.
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7. OFCCP Requests During Audit
• Compensation factors and data from the time
each employee started work (up to 10 years in
some cases)
• Background information regarding the audited
location (when was it acquired, how many
employees were laid-off due to acquisition, etc.)
• Proof of outreach, recruitment, and supporting
data for job groups with only 1 hire but observed
to have very few applicants30
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