Friday, March 27, 2020: Big Changes Ahead for OFCCP Construction Programs
The USDOL Inspector General Report on OFCCPs Construction Industry Program malaise reports important changes coming at OFCCP for construction contractors.
This Inspector General (IG) Report is a backdoor window reporting on OFCCP’s upcoming plans to begin to wrench itself out of the construction industry enforcement malaise in which the Agency finds itself. Here is what is on the horizon:
- A centralized audit scheduling “case management system” coming in FY 2021 based on contractor risk of non-compliance.“Looking forward, OFCCP officials said they planned to implement a new case management system in FY 2021 to include construction modules and reporting capabilities. This new system would allow OFCCP to centralize construction scheduling, giving it the ability to perform data analyses and schedule contractors for compliance evaluations. It would also have features that do not currently exist, such as ad hoc reporting of real-time transactional data and summary counts. Moreover, OFCCP could use this system to schedule contractors by risk of non-compliance.” (See pp. 7-8 of IG Report)
- A contractor “notification of construction contract award portal” (NCAP) coming.
“OFCCP has taken significant steps to centralize its scheduling of construction contractor compliance evaluations to ensure that its scheduling policies and practices comport with the Fourth Amendment standards and case law, including Baker DC, LLC v. Acosta, No. 1:17-CV-530, 2018 WL 1696799 (S.D. Ohio Apr. 6, 2018). In this effort, OFCCP has developed a Notification of Construction Contract Award Portal (NCAP) in which OFCCP uploads all contract award notifications. OFCCP will use NCAP to develop a central scheduling list to neutrally select construction contractors for compliance evaluations. OFCCP anticipates making the NCAP portal (sic) available to federal construction contractors and subcontractors for their use in Fiscal Year 2020.” (See p. 24 of IG Report which is p.3 of OFCCP’s written letter response to the IG’s Report.)Editor’s Note: OFCCP’s audit selection architecture is to thus “squeeze from both sides:” gathering from federal Agency contracting officers information about prime federal Government construction contracts and also about any subcontractors the federal Agency contracting officers might just be aware.Note: There is no reliable, current to real-time, or complete system of federal records recording covered federal Government construction subcontracts. OFCCP will gather evidence of covered federal Government construction contracts and subcontracts from covered contractors and subcontractors through the coming NCA portal (or NCAP).
Editor’s Note: Construction Contractors, please do not forget that OFCCP Rules already require you to report to OFCCP construction contract awards. See 41 CFR Section 60-4.2(c).
- A transparent construction audit methodology is coming.“OFCCP has committed to publishing its scheduling methodology for construction compliance evaluations.” OFCCP gave no date. See EDITOR’s NOTE below, after #4. See the beginning of bottom half of p. 24 of IG Report, which is p.3 of OFCCP’s written letter response to the IG’s Report.
- An OFCCP methodology to identify “likely (construction contractor) violators” unknown. “…the agency commits to studying the best strategies for identifying and scheduling likely violators in this industry.” See beginning of bottom half of p. 24 of IG Report, which is p.3 of OFCCP’s written letter response to the IG’s ReportEditor’s Note: It appears that OFCCP has the NCA portal currently open for the Agency’s internal use [“OFCCP has developed a…NCAP in which OFCCP uploads”] and is loading NCAP with contract awards. It plans to open the portal to contractors later this Fiscal Year 2020 [“OFCCP anticipates making the NCAP portal (sic) available to federal construction contractors and subcontractors … in Fiscal Year 2020”]. Then, at some later date, it appears OFCCP intends to start using the contract award information in the NCAP to make audit selections. Federal Government agencies, like OFCCP, and especially OFCCP, prefer to launch significant new enforcement programs, like NCAP auditing, at the beginning of a new Fiscal Year. So, the question then becomes whether OFCCP would be ready to start NCAP “likely violators” auditing on October 1, 2020 (start of Fiscal Year 2021) or October 1, 2021 (start of Fiscal Year 2022). Because OFCCP has not identified a “likely violators” audit selection protocol as of the March 20, 2020 date of its response letter to the IG Report, and since OFCCP has been thinking about this problem since at least the April 2018 (two years ago) decision in the Baker DC, LLC case, and OFCCP is “working remote” through this pandemic, it is more likely than not that OFCCP will not be ready and able to commence “likely violators” construction contractor audit selections until October 1, 2021 (for FY 2022).
- OFCCP promising, or not, an update of its 40-year-old construction goals.
OFCCP has pledged to “Update participation goals for minorities and females, and implement processes to keep all participation goals current.”
* * * * *
While engaging in rulemaking to update the participation goals would be an extensive undertaking. OFCCP is committed to exploring this option.” See paragraph 2. at bottom 1/3rd of p. 24 of IG Report, which is p.3 of OFCCP’s written letter response to the IG’s Report.
Editor’s Note: WOW! That was a tepid and evasive lawyer-like OFCCP response … “OFCCP is committed to exploring this option.” (emphases added) OFCCP is obviously going to be dragged kicking and screaming to any update of its 40-year-old construction goals. Cutting through the bureaucratic language of that remarkable sentence (which at least three senior OFCCP managers likely wrestled to finality in collegial body discussion about how to fill the page with words, but say nothing):
– “committed to exploring”: thus, OFCCP is committed to thinking about the issue, but is not yet committed to updating the goals as the IG recommends.
– “this option”: thus, OFCCP does not think that updating the 40-year-old goals is necessarily the best way to proceed (maybe a Republican Administration does not want to have its fingerprints on a regulatory endorsement of “goals,” even though President Nixon’s USDOL created and implemented in 1972 the concept of OFCCP “goals” in affirmative action planning: not Johnson or Kennedy).
Read all together, OFCCP’s response on updated construction goals appears to be an evasive and non-specific answer designed as a long hang-time punt. This suggests OFCCP’s current policy position is to put this issue on the back-burner and think about it when time permits.
ALSO, construction goals raise, again, the long-delayed and overdue goals nomenclature problem: what exactly are these goals, what is a “participation goal” (and how different from a “Placement Goal,” different from a “Utilization Goal,” and different from a “Benchmark for hires”) and is the word “participation” code for numerical or quota hiring? The “participation” goal language was born in the Carter Administration OFCCP, which initially thought quota hiring and promotions were lawful. Once the Carter OFCCP better understood that Title VII law did not permit quota employment transactions, it fell back to a “wink-wink” approach that decried quotas different from goals, but tried to encourage both unknowing, and separately, oftentimes willing, recruiters and HR managers to seize on suggestive language like “participation” goals which sounded like a sense of obligation (did not sound like an availability measure, but rather sounded like a hiring obligation)…i.e., the percentage which has to “participate:: i.e., be hired…or language like “goals and timetables,” which suggested an urgency…a near term obligation to hit “the number.” And, of course, this babble arose among the cacophony of many different OFCCP non-regulatory enforcement efforts to enact quotas in the form of “goals”…like: “Ultimate Goals,” “Interim-Ultimate Goals,” and the “Whole Person Rule” (complete with senior Carter OFCCP officials debating internally for a half-day whether contractors should round up or round down when calculating fractional percentage goals and converting them to numeric goals for Hiring Managers). Of course, the Clinton Administration formally, in writing, in what are today current OFCCP Rules, flatly banned both numerical goals and timetables following on the heels of the Reagan Administration which had sternly banned them, but only via oral podium policy.
OFCCP always dreads opening up the discussion as to what the Agency’s goals really mean, because it starts OFCCP down very slippery legal slopes. More discussion about goals also creates greater clarity as to what they are not and opens the eyes of many HR Managers who still innocently believe “goals” are not mere percentage availability calculations designed for the use of recruiters to know if their candidate searches are sufficiently complete and inclusive, but rather are a lawful way to somehow implement, in fact, otherwise unlawful quotas.