As OFCCP moves away from the Active Case Enforcement (ACE) approach to audits, the number of audits will increase and the timeframes for these compliance reviews will decrease (see this previous blog post for more context https://blog.dciconsult.com/directive-2019-01-evaluation-procedures).
But in order to understand what a shorter audit means for contractors, it is helpful to know how long an audit and the resulting conciliation process typically lasts.
To investigate this issue, DCI reviewed eight years of data (2010-2018) from conciliation agreements where there was an OFCCP allegation of contractors engaging in systemic discrimination and where the process resulted in a financial settlement. In addition to the total time from scheduling letter to conciliation agreement, DCI evaluated the total time from the agency issuing a Notice of Violation (NOV) to the date that the settlement was signed.
DCI evaluated all 278 conciliation agreements during the eight year period and categorized the agreements as follows:
- Overall – This includes all conciliation agreements with a financial settlement (e.g. hiring, compensation, steering).
- Hiring – This includes all conciliation agreements where the only allegation was systemic hiring discrimination.
- Compensation - This includes all conciliation agreements where the only allegation was systemic compensation discrimination.
These were the resulting calculations (please see the methodology notes at the end of this post if you would like to know more about how these numbers were calculated):
It should be noted that in most cases these discriminatory violations were accompanied by other non-discriminatory material violations, such as failure to maintain data for a period of at least two years, provide equal opportunity statements with job postings, etc.
Additionally, these are shortest and longest cases in the dataset:
- The shortest case from beginning to end was 30 days
- The longest case from beginning to end was 19 years and 6 months
- The shortest case from NOV to end was one day.
- The longest case from NOV to end was 6 years and 4 months
These numbers show that being involved in an audit and the resulting process is usually very resource intensive. The average time that it takes to arrive at an agreement is 3 years (with 2 years for compensation and 4 years for hiring cases) – even if there is a significant reduction in the amount of time it takes for an audit and the conciliation process to be completed, one could still reasonably expect the process to last for a year.
In order to reduce or avoid the amount of complications that arise as a result of being audited, it is important to proactively create an effective AAP. This is especially true since OFCCP has repeatedly communicated that the number of audits is expected to increase and that the likelihood that contractors will have to defend their practices to the agency will rise.
Having an AAP is not only required, but also helps contractors identify systemic issues, adopt relevant best practices, and explain what steps they have taken to address high risk areas OFCCP is likely to ask about.
Additional Notes on Methodology
The duration of an audit from beginning to end was calculated using the beginning date and the date the District Director signed the agreement (the rationale being that once a District Director signed the agreement, the agreement was likely to be accepted by both parties and therefore effectively end). Proxy data leaning towards conservative estimates were used in the event that information was missing.
The duration of an audit from Notice of Violation (NOV) to end was calculated using the Notice of Violation date or Notice of Investigation Results date and the date the District Director signed the agreement. Not every conciliation agreement had an NOV as sometimes the defendant chose to settle before the proceedings could reach such a point – these cases were not part of the data used to calculate the averages presented within this post.
In the event that the period of time from beginning or Notice of Violation to end date was less than a month long, the period of time was rounded up to one month.
Note: Since the signing date was used, the end dates here may differ from the month and year that OFCCP identified as the end date of a conciliation agreement.
By Alexander Hsu, HR Analyst, and David Cohen, President at DCI Consulting Group
