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Addressing a Gap: OFCCP Will Require Verification of Written AAP Compliance

On August 24, 2018, the U.S. Department of Labor’s (DOL) Office of Federal Contract Compliance Programs (OFCCP) issued three directives, including Directive 2018-07, Affirmative Action Program Verification Initiative, which aims at ensuring covered contractors are annually preparing and implementing updating written affirmative action programs (AAPs). This directive could have a wide-ranging impact on covered contractors, especially those that encounter challenges in preparing written AAPs annually.

The AAP Verification Initiative appears to directly address criticisms in a 2016 U.S. Government Accountability Office (GAO) report that OFCCP fails to “ensure that contractors are complying with basic requirements like developing and maintaining an AAP.” The new directive which cites this GAP report, requires OFCCP to develop a process for contractors to certify annually that they have complied with the AAP requirements. While the agency has jurisdiction over an estimated 120,000 contractor facilities, OFCCP audits only a small fraction of them due to budgetary constraints. According to OFCCP, the new directive will “help ensure there are no ‘free riders’ that benefit from participating in the federal procurement process while not bearing the corresponding costs of AAP compliance based on the current high likelihood they will not be listed (and potentially receiving an inequitable advantage over law abiding contractors).” 

Under the new directive, OFCCP outlines new initiatives to verify and monitor contractors’ compliance with written AAP requirements where OFCCP will (1) develop a process for contractors to annually certify compliance with written AAP requirements; (2) develop “information technology” so it can “collect and facilitate review of AAPs”; (3) conduct compliance checks to verify AAP requirement compliance; and (4) require contractors to timely submit written AAPs in an audit and grant extensions only for the submission of support data.

The directive allows OFCCP to include noncompliant contractors in the neutral scheduling methodology, which determines which contractors are audited. Before this directive, covered contractors were required to submit AAPs to the agency only in connection with defending an audit or possibly during a compliance investigation. The risks of not timely preparing and implementing written AAPs on an annual basis just increased for all contractors. 

Although OFCCP will prepare a public outreach and education campaign and will likely release more details on initiatives outlined in this directive, all contractors may want to review their current strategies for preparing and implementing AAPs and consider any necessary adjustments to ensure that their written AAPs are prepared and implemented annually.

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About this Author

T. Scott Kelly, Defense Contracting Attorney, Shareholder, Ogletree Deakins Law firm

Scott Kelly provides practical solutions for federal contractors and subcontractors across the United States to comply with the ever-changing affirmative action obligations imposed by doing business with the federal government.  He advocates on behalf of his clients in compliance evaluations and administrative enforcement actions triggered by the United States Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP).  Mr. Kelly assists manufacturing, transportation, construction, food processing, hospitality, healthcare, and financial institutions...

Of Counsel

*Currently licensed in Indiana only.

Lauren Hicks devotes the majority of her practice to representing federal contractors and subcontractors in compliance evaluations and administrative enforcement actions triggered by the United States Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP).

Ms. Hicks counsels employers on the preparation, management, and defense of their affirmative action programs and related matters, including jurisdictional analyses and preventative strategies. She has extensive experience with investigating and resolving systemic discrimination issues stemming from statistical disparities in hiring, compensation, and testing. Ms. Hicks has litigated numerous claims before courts and administrative agencies.

Ms. Hicks most recently served as a District Director for the Office of Federal Contract Compliance Programs in the United States Department of Labor. In that role Ms. Hicks oversaw hundreds of OFCCP compliance evaluations, resolving