OFCCP Audit Proposal Would Increase Paperwork 40%

The Labor Department’s Office of Federal Contract Compliance Programs has proposed far-reaching changes to its audit process for federal contractors that would dramatically increase its initial data request.

Background: A "scheduling letter” formally initiates federal contractor affirmative action audits and identifies the data that must be initially provided to OFCCP at the earliest stage of a compliance evaluation. The last substantial revision to the scheduling letter was in 2014 when OFCCP added, among other things, the requirement to submit individualized-level compensation data.

Normally, OFCCP requests a minimal amount of data to determine if it needs to request more information in order to perform an audit. In only 0.5 to 1.0% of cases does OFCCP determine that additional information beyond the initial request is needed.

The far-reaching proposed changes will significantly increase the burden on contractors—by at least 40%, according to DOL’s own estimates.

Federal contractors would be required to provide, among other things:

• Documentation of policies and practices regarding all employment recruiting, screening, and hiring mechanisms, including the use of artificial intelligence, algorithms, automated systems or other technology-based selection procedures;
• Information about whether promotions were competitive or non-competitive, previous and current compensation for each promotion, data regarding previous and current supervisors, and termination data separated by reason; and
• Temporary employees provided by staffing agencies must be included in a contractor’s compensation snapshot.

HR Policy will submit comments on the proposal, which are due January 20, 2023.  Additionally, the Association will be asking for an extension in order to receive input from our members.