There appears to still be confusion around what contractors are required to do with the VEVRAA annual hiring benchmark. Specifically, what should a contractor compare to the hiring benchmark?
- The contractor’s employment of protected veterans
- The contractor’s hiring of protected veterans
As DCI discussed in our first blog on the topic, the regulations do not require contractors to compare the benchmark to anything. As discussed in our second blog, during a DOL webinar a Solicitor of Labor (SOL) attorney indicated that the hiring benchmark should be compared to hires; however, an OFCCP representative indicated that the comparison should be to the contractor’s protected veteran employment. In our third blog, we explored OFCCP FAQs, which indicated that a contractor should compare the benchmark to hires. Hires, however, were defined to include internal movements. This raised the concern that a contractor could meet the benchmark without any external protected veteran hires.
Almost a year later, there is still no clarity about the hiring benchmark. This is evident in recent references, such as the OFCCP press release announcing the new national annual benchmark for VEVRAA as 7 percent. This press release stated that “contractors must compare the percentage of employees who are protected veterans in each of their establishments to the hiring benchmark set for that establishment.” [emphasis added]
In contrast, the revised itemized listing for the scheduling letter, outlines that the following must be submitted for item 14: “Documentation of the hiring benchmark adopted, the methodology used to establish it if using the five factors described in § 60-300.45(b)(2). If you are six months or more into your current AAP year on the date you receive this listing, please also submit information that reflects current year results.” Notice that the itemized listing only requires the percentage to be submitted. If the contractor is six months or more into the plan year then “results,” which are unclear in light of the regulatory requirements, are also supposed to be submitted.
In addition, the supporting documentation associated with the revised scheduling letter states that contractors shall “establish a benchmark for veteran representation in the workforce” and includes reference to “documentation of the hiring benchmark adopted, the methodology used to establish it if using the five factors, and the results of its comparison to incumbent workforce as described in 41 CFR 60-300.45.” Again, this is interesting when considered in light of the lack of requirement to conduct any analysis in the regulations. [emphasis added]
As if this wasn’t enough, there is still more confusion around when the new percentage should be adopted. For example, if a contractor has a January 2015 plan, but had not finalized the plan before the revised VEVRAA hiring benchmark was posted, should they adopt a 7% or 7.2% benchmark? For more information about how the percentage is calculated see this previous blog. Note, the percentage will be updated in the March or April time-frame each year.
By Kristen Pryor, Consultant and Yesenia Avila, Associate Consultant at DCI Consulting Group