The Ides of April is ominous this year not only because of the annual April 15 deadline to submit your tax return. This year the Department of Labor.s Office of Federal Contract Compliance Programs will be sending out "surveys" to 7,000 government contractor facilities. (It is anticipated that another 53,000 contractor facilities will receive the survey in the next year or two). In addition to information regarding the compensation of women and minority employees, the survey seeks information on other employment transactions (e.g., hiring and promotion data) using the broad definition of an applicant that the OFCCP has been pursuing for the last few years over the objection of the contractor community.
Contractors have been flagged to receive the survey based upon their EEO-1 reports showing underutilization or concentrations of women and minority employees in the nine EEO job categories. We anticipate that OFCCP will contend that being "flagged" provides probable cause that the contractor is violating the law. The agency takes the position that responding to the pay survey is mandatory and that a failure to respond will lead to an enforcement action. The agency intends to use the information received from the survey to further target and select contractors for compliance evaluations.
We think there are significant legal arguments that a response is not mandatory and that selecting contractors to receive the survey through the "flagging" system is legally flawed. We would be happy to share these arguments with you. However, even if a contractor decides to cooperate, there are many strategic issues you should consider in developing and reporting the requested information. You may want to have your draft response reviewed before you send it in, as it will be the basis for agency action vis-`-vis your facilities.
In another development, Shirley Wilcher, the Deputy Director of OFCCP, announced on April 7, 2000, that the long awaited proposed regulations regarding the preparation of a contractor.s affirmative action plan will be released within the next "three to four weeks." Although this has been promised before, it is anticipated that the proposed changes will streamline the workforce analysis process.
Paul, Hastings, Janofsky & Walker LLP regularly assists government contractors with complying with their obligations under Executive Order 11246, Section 503 of the Rehabilitation Act of 1973, and the affirmative action obligations contained within the Vietnam Era Veterans Readjustment Act, including preparing affirmative action plans and conducting self-audits of compensation.
Client Alert is published solely for the interest of friends and clients of Paul, Hastings, Janofsky & Walker LLP and should in no way be relied upon or construed as legal advice. For specific information on recent developments or particular factual situations, the opinion of legal counsel should be sought. PHJ&W is a partnership, including professional corporations.) 2000 Paul, Hastings, Janofsky & Walker