March 19, 2018Client Alert

OFCCP Increases Transparency with Consistent Use of Predetermination Notices

As further evidence that the OFCCP is listening to the contractor feedback from the town hall meetings last fall, the agency has taken steps to increase transparency and consistency during compliance reviews. Although the OFCCP has long had a tool for informing contractors about discrimination findings before issuing a formal Notice of Violation (NOV), the regional and district offices have had great discretion on the use of Predetermination Notices (PDN) in cases that did not involve allegations of systemic discrimination. On Wednesday, March 14, 2018, the Office of Federal Contract Compliance (OFCCP) issued a new directive (DIR 2018-01) requiring all offices to use PDNs in every compliance evaluation where the agency has made a preliminary finding of employment discrimination.

The PDN notifies contractors that the agency has reached a preliminary finding of discrimination and, absent more information, plans to issue a Notice of Violation (NOV) – after which the contractor and agency either agree to a settlement or the agency can move to administrative litigation. By making the PDNs mandatory, the OFCCP aims to increase communication with contractors and provide them the opportunity to respond to preliminary findings. The PDN provides the contractor 15 days to rebut the OFCCP’s proposed finding that sufficient evidence exists of discrimination. Then the appropriate regional Office of the Solicitor must review the PDNs before they can be submitted to the national OFCCP office for a final decision about whether a NOV should issue.

This change results in more steps of review prior to the OFCCP issuing a NOV. One would expect the following impacts: (1) fewer NOVs will be issued; (2) the NOVs actually issued will have faced tougher scrutiny.

The directive does not change the laws or establish rights of the contractor. Rather, it provides welcome transparency to the contractor community about what to expect.

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