January 30, 2017Client Alert

New Administration Contractor Compliance Strategies: Stay Calm and Stay the Course

As we settle into the New Year, the human resources departments at many government contractors are either well into developing their 2017 Affirmative Action Programs (AAPs) or thinking about how the change in administration will affect the operations of the Office of Federal Contract Compliance Programs (OFCCP) and their AAPs going forward.

With the hearings on the confirmation of the Secretary of Labor nominee, Andy Puzder, pushed back for a third time, it may be a while before there are answers on the OFCCP’s future operations. History provides some guidance on how the OFCCP has typically operated in Republican administrations. If the precedent holds, contractors can expect that focus will be on the agency’s core missions (e.g. Executive Order 11246) rather than the expansions of authority and coverage the Obama administration effectuated through executive orders and administrative regulations (e.g. federal contractor minimum wage, pay transparency, and paid sick leave).

Efficiency during audits will likely be an important target given the Obama administration’s low audit numbers without increased success in identifying discrimination and/or obtaining monetary awards, something the Republican Congress criticized during budget appropriations. The past Republican administration’s approach led to more streamlined desk audits of the initial AAP and data submission in compliance reviews and fast closures of reviews where the AAP and support data present no obvious issues. We also expect less focus on broad-based statistical and disparate impact-type analyses that, without more evidence, have been criticized as unfairly targeting contractors with findings of discriminatory practices.

Accordingly, while waiting for the top Department of Labor positions to be filled, contractors would be well advised to pay particular attention to their analysis of applicants, hires, promotions, and terminations to ensure the data is clean and that any remaining adverse impact that would be seen in the OFCCP’s usual review of the initial submission is explained. Similarly, continued review, analysis, and assessment of compensation decisions and processes should be ongoing.  The regulations, if not the precise enforcement strategies requiring compensation review, are not new and will likely survive any transition. Although there will be some time to review the data upon receipt of a scheduling letter, to best take advantage of the anticipated streamlined procedures, companies would be well served to have most of the questions resolved when the AAPs are put into place.

Contractors should also consider whether to involve inside or outside counsel in the research and analysis of any potential adverse impact or compensation reviews to preserve the attorney/client privilege as much as possible.

Contractors should review their compliance with the new disability and veteran regulations. Since these regulations were promulgated by the Obama administration, there is no enforcement history under Republican presidents. However, one thing is clear: there are a number of requirements such as career website language, listing with the state employment service delivery systems, using appropriate advertising taglines, and identifying specific outreach sources, that are easy to include in an efficient checklist for compliance officer use in even a streamlined desk audit. We urge contractors to pay attention to these requirements and do annual self-audits.

For contractors with underutilization of individuals with disabilities, the 2017 Workforce Recruitment Program (WRP) database is now available. The WRP is managed by the Department of Labor’s Office of Disability Employment Policy and provides a database of screened students and recent graduates with disabilities. Employers seeking to fill internships and regular positions may use this link to register and search the database:

Additional resources for VEVRAA Plan compliance, including a job posting board, are available at

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