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New Government Contractor AAP Verification Process Coming?
By: Charles McClellan

Last fall, the Office of Federal Contract Compliance Programs (“OFCCP”) received approval from the Office of Management and Budget (“OMB”) to implement a new online platform — the Affirmative Action Program Verification Interface (“AAP-VI”) — to collect information from covered federal contractors (including covered subcontractors) regarding their affirmative action programs.

The proposed AAP-VI consists of two separate elements. First, it provides a portal for contractors to submit electronic copies of their AAPs and supporting documents to the OFCCP during an audit. Second, it creates a new “certification” tool for all covered contractors. This new tool would require each contractor to annually certify that it has (or has not) created and maintained compliant affirmative action plans at each establishment and to acknowledge that the contractor may not alter or update its current AAPs once such certification is made. One impact of such a tool is that it would give OFCCP, for the first time, a database of entities that identify as government subcontractors. The OFCCP would be able to use that information to identify future targets for enforcement activities, such as compliance audits.

OMB’s approval signifies its conclusion that the OFCCP’s record-keeping proposal would not be inappropriately burdensome on federal contractors or duplicative or in conflict with the work of other federal agencies. But OMB does not review the substance of the agency proposals or determine whether they are within the scope of an agency’s regulatory authority. The OFCCP claims that existing affirmative-action regulations allow it to require contractors to use the AAP-VI,      Continue Reading...
DOL Proposes Rule to Raise Minimum Wage for Federal Contract Workers
By: Donald Berner

The Department of Labor issued a proposed rule raising the minimum wage for employess working on federal government service and construction contracts to $10.10 per hour. The proposed rule implements Executive Order 13658, which was announced by President Obama on February 12. The Executive Order applies to new and renewed contracts with the federal government after January 1, 2015. The proposed rule now goes through a public comment period. To read the DOL's press release click here.  Stay tuned for further developments on the proposed rule.   

New Affirmative Action Rules for Government Contractors
By: Boyd Byers
Federal contractors and subcontractors now must adopt quantifiable goals for the employment of individuals with disabilities and protected veterans, according to new regulations issued by the U.S. Department of Labor’s Office of Federal Contract Compliance Programs. The new Rehabilitation Act regulations require contractors to establish a “utilization goal” of having 7 percent of their workforce be comprised of persons with disabilities. Similarly, the new regulations under the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) require contractors to establish a “benchmark” for hiring veterans. Contractors may either use the national percentage of veterans in the civilian labor force, which currently stands at 8 percent, or develop their own hiring benchmark based on factors listed in the regulations.
Both sets of new regulations point out that the respective utilization goals and benchmarks are neither rigid quotas, nor are they floors or ceilings on the hiring and employment of individuals with disabilities or protected veterans. A contractor’s failure to meet these metrics, however, will invite government scrutiny into the adequacy of its affirmative efforts to recruit and employ members of these protected classes.
In addition to these new metrics, the regulations impose additional data collection, self-identification, and other requirements on contractors. For example, contractors now must collect and retain data regarding the total number of job openings and jobs filled; the total number of job applicants and the number of applicants known to have disabilities or to be veterans;      Continue Reading...
Employer Flunks the Test with Pre-Employment Testing
By: Donald Berner

The use of pre-employment testing by employers has become more common in recent times. In most cases, the testing is conducted by outside vendors offering these types of services to multiple groups of employers. While these tests seem to be a good idea to most employers, it is important to make sure they pass muster with the various administrative agencies at the federal and state level.

In a recent example of a test gone wrong, the OFCCP took issue with an employer's written testing program. The test had an adverse impact on minority applicants and failed to meet the EEOC's Uniform Guidelines on Employee Selection Procedures.  In this recent case, the OFCCP reached a $550,000 settlement with the employer. Click here for the OFCCP press release.

While having the OFCCP involved might suggest this is only an issue for written tests and government contractors, don't be misled. This is only an OFCCP issue because the problem was uncovered by an OFCCP audit of the employer. The EEOC's requirements in this area apply to all employers. In addition, the selection guidelines apply to all types of pre-employment testing, ranging from written testing to skills testing to strength-and-agility testing.

If your company conducts these types of tests, it is important to ensure there is not an adverse impact on a specific class of individuals. If there is an adverse impact, the employer can still defend the testing measure if the employer can show the test is an accurate predictor of a candidate's ability to perform a job. This is where      Continue Reading...

Cost to Comply with Proposed Affirmative Action Regulations May Be Billions (Yes, That’s Billions with a B)
By: Boyd Byers

Federal government contractors’ costs to comply with proposed affirmative action regulations for individuals with disabilities could total $5.9 billion dollars in the first year, with recurring annual costs of $2.6 billion, according to a new study by Applied Economic Strategies.  These projected first-year costs are 200 times higher than the government’s estimate of $29.5 million.  (We all know the federal government has never underestimated the cost of anything before!) 

The AES report criticizes OFCCP’s estimates for missing and underestimating numerous costs to contractors.  For example, OFCCP failed to account for time that contractors would have to spend to read and understand the new regulations.  Assuming four hours of work per contractor (and, boy, will those four hours be fun), AES estimated that cost alone at $69.7 million—more than double the OFCCP's entire estimate.  The AES projections also accounted for contractors’ costs to modify existing processes, forms, and information systems to comply with proposed data collection rules.  The full report, available here, monetizes the costs of many other aspects of the proposed regulations, including the self-identification, written rejection letter, annual job qualification review, annual disability survey, and various outreach requirements.

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Don Berner, the Labor Law, OSHA, & Immigration Law Guy
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Boyd Byers, the General Employment Law Guy
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Jason Lacey, the Employee Benefits Guy
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