Top OFCCP Violations and How to Avoid Them - Arcoro
The article discusses the federal government's $1.5 trillion infrastructure investment leading to increased construction hiring, emphasizing the importance for contractors to maintain OFCCP compliance by avoiding common violations such as inadequate record-keeping, discriminatory hiring practices, and unexplained pay disparities, as audits by the Office of Federal Contract Compliance Programs rigorously enforce these regulations to ensure safe, non-discriminatory employment practices.
Infrastructure Improvement Initiative
Infrastructure is a significant focus for the federal government, with plans to spend $1.5 trillion on repairing and upgrading America’s infrastructure. This investment aims to create jobs, expand communities, and ensure the safety of essential structures. The budget will be distributed among state and local governments for projects such as bridges, highways, and tunnels. Contractors play a crucial role in these efforts, and the government is closely monitoring compliance and safety.
With this initiative, there will be a surge in hiring across the construction industry. Hiring managers must stay current with certifications, safety training, and compliance documentation to maintain federal compliance and avoid fines and other consequences.
What is an OFCCP Compliance Check?
The U.S. federal government, as the world’s largest consumer, requires federal contractors to follow various rules and regulations. The Department of Labor (DOL) enforces these regulations through audits by the Office of Federal Contract Compliance Programs (OFCCP). The purpose of an OFCCP audit is to ensure contractors follow safe and non-discriminatory practices throughout the employee life cycle. Requirements vary based on company size and contract value. According to the MRA, the top three violations are related to record keeping, recruiting, and affirmative action plans.
3 Common OFCCP Violations Auditors Look For
- 1.Inadequate records to defend applicant flow and interview practices
- 2.Discriminatory decision-making processes for hiring, promotions, terminations, etc.
- 3.Compensation disparities that can’t be explained
The audit process includes reviewing records, interviewing employees and supervisors, and inspecting worksites. In 2017, the average OFCCP audit lasted 720 days and cost U.S. companies a total of $23,910,884.
As the infrastructure initiative progresses, HR teams and hiring managers must proactively prepare for OFCCP audits to avoid fines and other serious consequences.
Recordkeeping
Recordkeeping was the number one OFCCP violation in 2017 and affects every aspect of an audit. Auditors review all types of documents, including job postings, resumes, interview notes, transfers, promotions, and terminations. Contractors must demonstrate that all documentation meets regulatory requirements.
Record retrieval is a significant part of the audit process. Companies relying on paper documentation may face lengthy and stressful audits, which can negatively impact morale, employee engagement, retention, and future recruiting. Investing in integrated recordkeeping software can streamline processes and make document retrieval easier and faster.
Recruiting & Affirmative Action Programs
Recruiting and Affirmative Action Programs (AAPs) are closely linked, as AAPs are a recruiting requirement from the OFCCP. AAPs consist of policies, practices, and procedures to ensure equal opportunities in the workplace. OFCCP auditors review recruiting activities starting from the initial job posting. Job postings that target or exclude specific demographics can result in audit failures.
Paper applications pose a significant OFCCP liability due to the risk of misplacement. Using an applicant tracking system (ATS) helps ensure all applications are accounted for and stored securely, supporting compliance.
AAPs are not limited to recruiting; they guide organizational behavior and procedures throughout the employee life cycle. The OFCCP provides sample AAPs to help contractors develop their own plans.
What Next?
The top three OFCCP violations can be mitigated by diligently tracking personnel information. While some variables about the infrastructure plan remain unknown, OFCCP compliance remains essential. If you are concerned about potential violations or failing an audit, consider requesting an HR assessment to review your processes and ensure compliance.
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