OFCCP Releases Opinion Letter on Pay Analysis Groups

On July 22, 2019, OFCCP released an opinion letter in response to a request to address whether contractors can work with OFCCP to develop a Pay Analysis Group (PAG) structure that OFCCP would accept as valid for use in future OFCCP audits. 

According to OFCCP, contractors have the opportunity to submit their PAG structure for review and receive feedback, which OFCCP would take into account in future compliance evaluations. However, OFCCP notes that it is unable to conclusively agree that it will “rely upon specific, predetermined PAGs in all future compliance evaluations” because of the possibility of material changes to factors considered by OFCCP during its initial evaluation of the contractor’s PAGs. As stated in the opinion letter: 

“OFCCP must conduct its analyses based on the contractor's pay systems, functions, and workforce organization as they exist or existed during the period under review, and thus if those have materially changed since OFCCP's prior review, OFCCP will need to make a new determination as to whether the PAGs are appropriate.” 

In essence, OFCCP will review contractors’ PAGs, and can possibly give feedback, but there is no guarantee that they will use the PAGs for any compliance evaluation. However, if contractors submit PAGs, OFCCP may consider them and the submission can help facilitate collaboration. Ultimately, OFCCP does not have to use the submitted PAGs, even if they approved them prior to the compliance evaluation at some point in time.

To read the full opinion letter, visit the OFCCP website.

By DCI Consulting Group

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