The Labor Department’s Office of Federal Contract Compliance Programs’ revised scheduling letter proposal would substantially change its audit process for federal contractors and would dramatically increase the costs for its initial data request.
Background: In November 2022, OFCCP proposed to significantly change its “scheduling letter,” which formally initiates federal contractor affirmative action audits and identifies the data contractors must initially provide to OFCCP at the earliest stage of a compliance evaluation. HR Policy submitted comments on the proposal. 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 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.
OFCCP ignored most employer comments in its second proposal but did address two issues:
- Promotions: OFCCP dropped the proposed requirement for contractors to identify each promotion as “competitive” or “noncompetitive” and the proposed requirement to provide information on the previous supervisor, current supervisor, previous compensation, current compensation, department, job group, and job title from which and to which individuals were promoted.
- Terminations: OFCCP removed the request for information on the specific reasons for terminations.
The far-reaching proposed changes will significantly increase the burden on contractors—by at least 34 percent, according to OFCCP’s own estimates. Moreover, because the agency is asking for so much more information at the initial stage of an audit, OFCCP estimates the number of audits it conducts every year will drop by 50 percent.
HR Policy will submit comments on the latest proposal, which are due May 17, 2023. Additionally, the Association will ask for an extension to allow us to receive thoughtful input from our members.