Affirmative-Action Regulatory Focus Shifts

By Goldstein, David | National Defense, August 2001 | Go to article overview

Affirmative-Action Regulatory Focus Shifts


Goldstein, David, National Defense


Government wants contractors to seek results, not just show compliance

Remember the new math? That was the short-lived teaching philosophy that rewarded students for following the right process, even if they reached the wrong answer.

Government policy on affirmative action has long been a similar exercise. If contractors followed the technical requirements of the law, they usually got a free pass--even if their policies resulted in little tangible progress for women and minorities in the workplace.

But as of 2001, new math is our.

Late last year, the federal Office of Contract Compliance Programs (OFCCP) completed its first major overhaul in 30 years of regulations governing affirmative action programs. The new rules took effect on December 13, 2000.

The many technical changes in the new regulations are less significant than the shift in focus. The government now wants to see contractors targeting results, not just designing a policy in order to show compliance. And it has backed up this goal with a powerful new tool--a bi-annual survey of workforce and compensation data that gives the OFCCP a road map for conducting audits.

The new regulations apply to any organization with 50 or more employees that:

* Has a contract with the United States of $50,000 or more.

* Has a subcontract of $50,000 or more that is necessary to a primary contractor s performance of a covered federal contract.

* Has government bills of lading that in any 12-month period total, or can reasonably be expected to total, $50,000 or more.

* Serves as a depository of government funds in any amount.

* Is a financial institution that is an issuing and paying agent for U.S. savings bonds and savings notes in any amount.

Many employers are covered by federal affirmative-action requirements without realizing it. This happens most often when a company enters into a subcontract to provide goods or services to another company without realizing that the prime contractor is doing business with the federal government. However, the same situation also can arise as a result of a failure in communication between a company's sales department and its human-resources department or in-house legal counsel.

Even though the new rules cover all but the smallest contractors, small- to medium-sized businesses are likely to feel the greatest impact. The agency's traditional lack of enforcement has allowed some contractors to fly under the radar, giving only lip service to affirmative action in a belief that the likelihood of being audited was small.

That is no longer so. While the giant contractors have long been aggressive and proactive about affirmative action--knowing that the government was looking over their shoulder--smaller players now are likely to face similar scrutiny.

As was true under prior regulations, covered employers are required to adopt a formal affirmative-action program, documented by a written plan. An acceptable program must include procedures for reviewing all employment related practices, ensuring equal-employment opportunity and implementing good faith efforts to employ and advance women and minorities.

If a company was compliant before, the rules are written in such a way that it is likely to be compliant now. In fact, several aspects of the rules simplify the affirmative-action process for contractors. For example:

* Workforce Analysis--Employers previously were required to prepare a workforce analysis listing every job title used in the organization by department. Employers will now have the option of preparing an "organizational profile" which, in some cases, may be easier to generate.

* Availability and Utilization Analysis--Under one key element of an affirmative-action program, employers must assess the availability of women and minorities in the labor force to fill the types of jobs performed for the employer.

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