On Friday, September 7, 2018 the Office of Federal Contract Compliance Programs (OFCCP) announced that it had mailed 750 new Corporate Scheduling Announcement Letters (CSALs). A CSAL is a courtesy notification from the OFCCP to an establishment that it has been selected to undergo a compliance review (audit) as early as 45 days from the date of the letter. Also on Friday, the OFCCP published a notice identifying the limited circumstances under which it will consider granting extensions of time to respond to a scheduling letter and the significant consequences of failing to respond in 30 days. Considering the joint impact of these two announcements, contractors should do all of the following:
- Because CSALS are sent to the establishment rather than to the corporate offices, contractors should notify all locations that have had 50 or more employees since 2015 to be on the lookout for a letter from the OFCCP and to immediately alert corporate if a letter is received;
- Any location receiving a CSAL should examine whether it falls into any of the exclusions established by the current OFCCP scheduling methodology, such as the only current covered contract expires before January 1, 2019 or that the establishment completed a review in the last five years;
- If the establishment doesn’t qualify for an exclusion from audit, the company should immediately begin reviewing its current AAPs to be sure that it is undertaking and can document all of the action items specified in the programs, as well as confirming that its applicant, new hire, promotion, and termination data are accurate and any potential adverse impact can be explained;
- The review of the AAPs also should include a review of compensation using the methodology the OFCCP outlined in Directive 2018-06 issued on August 24, 2018; and
- If the location receiving a CSAL is more than six months into its AAP year, the company should also begin compiling and analyzing six months of additional data. Although it might be possible to send in the current AAP and obtain an extension to submit the supplemental data, it is best to send it all within the 30-day period.
The statements and actions of the current OFCCP make clear the agency is committed to ensuring that contractors fully comply with all of their current obligations. Acting Director Craig Leen stated on several occasions that he is aiming for 100% compliance. The Friday notice warns that contractors who miss the 30-day submission deadline WILL receive a Notice to Show Cause why enforcement should not ensue, and complements OFCCP Directive 2018-07 issued on August 24, 2018. Directive 2018-07 mandates the OFCCP to develop a process requiring contractors to annually certify they are in compliance with their affirmative action obligations.
Finally, all contractors should be aware that the government’s 2019 fiscal year starts October 1, 2018. The start of the new fiscal year likely will be followed by a new round of CSALs, some of which will involve the focused reviews described in OFCCP Directive 2018-04 and discussed previously in the Michael Best alert titled, “OFCCP Notice of Significant Change in Compliance Review Procedures.”
Please contact us if you have any questions about this information or to discuss affirmative action compliance.