OFCCP's TAG, Part 8: Affirmative Action Programs

This week we continue our blog series on the Office of Federal Contract Compliance Program’s (OFCCP) Technical Assistance Guide (TAG) for supply and service contractors and subcontractors. This post will outline the agency’s requirements regarding affirmative action programs (AAPs). We will discuss the agency’s thresholds for AAP development and the agency’s expectation about the placement of employees into affirmative action programs. 

Read previous installments of the TAG series:

• Part 7: Recordkeeping for Internet Applicants
• Part 6: Invitation to Self-Identify
• Part 5: Recordkeeping Requirements
• Part 4: Listing Jobs with the ESDS
• Part 3: Postings, Listings, and Notices 
• Part 2: Two General Rules
• Part 1: Overview

We need to start with a quick note about the term “affirmative action program.” Most people call the written documents that are prepared to meet the federal affirmative action obligations “affirmative action plans.” However, OFCCP’s formal regulations and guidance materials like the supply and service TAG use the term “affirmative action program” rather than “affirmative action plan.” 

Affirmative Action Programs for OFCCP's Three Laws

As previously discussed in this blog series, OFCCP enforces three laws: 

• Executive Order 11246 as amended 
• Section 503 of the Rehabilitation Act of 1973 (referred to as Section 503) 
• The Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (referred to as VEVRAA) 

Federal contractors and subcontractors with 50 or more employees and who have contracts exceeding the dollar thresholds pertaining to each of the laws above are required to complete written AAPs. The employee and dollar thresholds for each law are outlined in an infographic available from OFCCP. The thresholds for each law are as follows: 

• Executive Order 11246 – Employers with 50 or more employees that have a single federal contract or subcontract of $50,000 or more 
• Section 503 – Employers with 50 or more employees that have a single federal contract or subcontract of $50,000 or more 
• VEVRAA – Employers with 50 or more employees that have a single federal contract or subcontract of $150,000 

Federal contractors and subcontractors must develop AAPs within 120 days of the start of a federal contract or subcontract or upon reaching 50 employees after signing the contract or subcontract. AAPs are only submitted to OFCCP when requested during the onset of a compliance evaluation. Federal contractors and subcontractors must make their Section 503 and VEVRAA AAPs available to applicants and employees upon request.

Objectives of the AAPs

The TAG states that “The overall objectives of each AAP are to: 

• Identify areas in the workforce that are deficient in the utilization of women, minorities, individuals with disabilities, and/or veterans. 
• Undertake appropriate actions to address underutilization and achieve or exceed utilization of women, minorities, individuals with disabilities, and/or hiring of veterans at all levels and all segments of the workforce. Over time, contractors should have workforces that reflect the demographics of the labor pools from which they select employees.” 

Later in this blog series, we will dive into specific components that must be included in the AAPs that correspond to each of the laws that OFCCP enforces. 

Organizing Affirmative Action Programs

Federal contractors and subcontractors subject to OFCCP’s AAP requirements are given two options regarding how to organize their employees into AAPs: by establishment or by functional or business unit. 

By Establishment 

The most common way to prepare AAPs is to include all employees at a specific “establishment.” While OFCCP has never fully defined the term “establishment,” this term typically refers to an employer’s physical location. As a general matter, all employees at a particular establishment must be included in that establishment’s AAPs. However: 

• An employee who reports to a manager outside of the establishment where the employee is located should be included in the AAP that covers his or her manager. A corollary to this is that employees should be included in the AAPs of the establishment where selection decisions for their positions are made. 
• Employees at establishments containing less than 50 employees can be included in their own AAPs or included in other AAPs that cover the human resources representatives or officials who are responsible for that establishment. 

The TAG notes that the AAP must identify the physical location of any employees who are not located at the establishment included in the AAP. 

OFCCP has provided additional guidance regarding employees who are based at a remote location or who are involved in telework. These employees can be included: 

• In the AAPs that cover their managers; 
• In the AAPs of the establishments where the employees’ selection decisions would be made; or, 
• In the AAPs that cover the locations of the personnel function that support the employees. 

By Function or Business Unit 

Federal contractors and subcontractors may develop affirmative action programs by function or business unit when this is the manner in which a unit is organized. AAPs that are organized by function or business unit rather than establishment are called Functional Affirmative Action Programs (FAAPs). FAAPs can include employees from multiple locations or they can include employees at a single establishment who are part of a defined function or business unit.  

Employers interested in developing FAAPs must seek formal approval to do so through an agreement with OFCCP. These agreements are valid for five years. After that, the employer may request a renewal of the agreement. FAAPs and establishment-based AAPs have the same required AAP elements and contractors may utilize FAAPs for Executive Order 11246, Section 503, and VEVRAA. The TAG does not cover FAAP requirements in depth. However, you can read more about FAAPs on OFCCP’s FAAP compliance assistance page. 

Next in this Series…

Our next post in this blog series dives into OFCCP’s specific requirements and components for Executive Order 11246 AAPs. 

By Cassie Alfheim, Consultant