May 26, 2020

OFCCP Rolls Out Changes to its Functional Affirmative Action Plan Program

Functional affirmative action plans (FAAPs) are not new.  While the regulations require AAPs be prepared on an establishment-basis, OFCCP has permitted contractors to structure their AAPs by “function” or “business unit” – with Agency approval.

Implicitly, the Agency’s 2013 Directive on the subject recognized that business structures had evolved since the 1960s.  Establishment-centered chains of command were fading, and geographically diverse teams were rising.  Since then, this workforce evolution has only gained steam, including a substantive revision in 2016.

Dating back to town hall sessions in early 2018, the current OFCCP administration under Craig Leen has been doing some deep thinking on how to “best” incentivize contractors to adopt AAP structures, that may better reflect how recruiting is done in certain organizations, and empower them to better meet the goals of Executive Order 11246.  If contractors are not organized by establishment, why should their AAPs be so rigid?

In answer to that question, OFCCP has issued an updated FAAP Directive.  OFCCP summarized the highlights of the update as follows:

  • OFCCP will no longer consider compliance history when reviewing a request for a new FAAP agreement or termination.

  • The agreement term is extended to five years, up from three years.

  • There will be a minimum of 36 months between compliance evaluations for a single functional unit. This is 12 months longer than an establishment review.

  • Complete FAAP applications will be determined within 60 days. Historically, there was no deadline.

  • OFCCP no longer requires that FAAP contractors undergo at least one compliance evaluation during the term of their FAAP agreement.

Procedurally, these changes reduce the burden of a FAAP Agreement by extending its term and committing to act on all applications within 60 days.  And, substantively, these changes may seem advantageous —audits are no longer required, and should they occur each plan would be immune from a second audit for a year longer than an employer who prepares establishment plans.

There are a multitude of issues to considering before changing to a FAAP program.  

Jackson Lewis P.C. © 2020


About this Author

Laura Mitchell, Jackson Lewis, Management Representation lawyer, Contractual Drafting Attorney

Laura A. Mitchell is a Principal in the Denver, Colorado, office of Jackson Lewis P.C. She represents management exclusively in all areas of employment law, focusing on affirmative action and government contractor compliance.

Ms. Mitchell is a Principal in the firm’s Affirmative Action and OFCCP Defense practice group, representing government and non-government contractors in Office of Federal Contract Compliance Programs (OFCCP) matters, preparing for and defending OFCCP audits, and counseling employers on issues stemming...

Christopher T. Patrick employment lawyer Jackson Lewis

Christopher T. Patrick is a Principal in the Denver, Colorado, office of Jackson Lewis P.C. His practice focuses equal employment opportunity, including proactive pay equity analyses, compliance with regulations promulgated by the Office of Federal Contracts Compliance Programs (OFCCP), statistical analyses of potential discrimination in employment practices, and defending employment practices in OFCCP audits and investigations.

While attending law school, Mr. Patrick served as on the Editorial Board for The Journal for the National Association of Administrative Law Judges

Prior to joining Jackson Lewis, Mr. Patrick practiced in boutique firms in Los Angeles and Denver and centered his practice on civil litigation, including issues of employment discrimination, non‑competition agreements, protection of intellectual property rights, and other employment-related issues.