More Record Keeping Ahead for Federal Contractors and Subcontractors
December 16, 2013

By Bruce B. Deadman & Mary S. Gerbig

Federal and state contractors and subcontractors who are required to maintain an Affirmative Action Plan (AAP) have some additional plan work to do within the next year involving the 2010 Census Data. But just what are these new requirements and who is affected.

Who is a Federal Contractor or Subcontractor?
If your company does business with the federal government, you are most likely a federal contractor under Executive Order 11246. The Office of Federal Contract Compliance (OFCCP) enforces this Order, as amended, which prohibits federal contractors and federally-assisted construction contractors and subcontractors, who do more than $50,000 in government business in one year and have at least 50 employees (the “50/50” test) from discriminating in employment decisions on the basis of race, color, religion, sex, or national origin. The Order also requires government contractors to take affirmative action to ensure that equal opportunity is provided in all aspects of their employment.

If your company does business with another company who holds direct contracts with the federal government and meet the “50/50” test, you are probably a covered subcontractor and are covered by the Order.

Who is a State Contractor or Subcontractor?
An AAP is required from any contractor or subcontractor who receives a State contract of more than $50,000 and has a workforce of 25 or more employees as of the award date, unless the contractor is exempt by established criteria. The Plan must be provided to the contracting agency within 15 working days of the award date of the State contract and must have been prepared or revised not more than one year prior to the award date of the contract.

Failure to maintain a proper Federal or State AA Plan can result in sanctions ranging from remedial orders to debarment from the bid process. In other words, if you are required to have a plan, you need to have a plan.

New Census Data Must Be Used
The OFCCP requires federal contractors and subcontractors who must maintain an AAP to “use the most current and discrete statistical information available.” (41 CFR 60-2.14(d)). For the last decade, that has meant that covered employers could use 2000 Census data to conduct the various analyses required by OFCCP.

But, now that the 2010 Census Data is available, covered employers must use 2010 Census data for all plans commencing on or after January 1, 2014. Plans with a 2013 start date may voluntarily use the 2010 Data. The data is available at http://1.usa.gov/1hpQS3e, or by going to http://1.usa.gov/1gCgOox and using the “Search” options.

The bad news is that this is not an optional activity, and that covered contractors have to update their data in time for their 2014 plan. The sort of good news is that, unlike ObamaCare, the Census Bureau website actually works, although it takes a few tries to get the hang of doing a proper search.

Remember, your analyses need to reflect the availability of women and minorities in a “reasonable” recruitment area. That means your recruitment area will vary depending on the position. For example, a Green Bay employer may look for semi-skilled labor in Brown and surrounding counties, but may look for supervisors and executives on a statewide or even broader basis. Your data search needs to reflect that.

Hint: Use the “View” option and then download your data to an Excel Spreadsheet. With practice, data for a position can be gathered in about 10 minutes.

While no definitive word has been received from the State as to whether the new Census data must be used, the best practice is to do so.

OFCCP Issues Final Rules Regarding Record Keeping For Veterans and Disabled
On August 27, the Department of Labor (DOL) announced two final rules which it contends will “improve” hiring and employment of veterans and people with disabilities.

For years, the Vietnam Era Veterans' Readjustment Assistance Act of 1974 (VEVRAA) and Section 503 of the Rehabilitation Act of 1973 have required federal contractors and subcontractors to affirmatively recruit, hire, train and promote qualified veterans and people with disabilities.

The new rules require federal contractors and subcontractors to adopt hiring benchmarks for both veterans and qualified individuals with disabilities and to undertake record-keeping and analyses similar to the current requirements for women and minorities.

The rules become effective on March 24, 2014.

Bruce B. Deadman and Mary S. Gerbig are attorneys with the law firm of Davis & Kuelthau in Green Bay. Their practices focus on labor and employment. They can be reached at bdeadman@dkattorneys.com, mgerbig@dkattorneys.com or 920.435.9378.

This article was published in the December 16, 2013 edition of The Business News.

 

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