In August of 2018, Director Craig E. Leen released DIRECTIVE (DIR) 2018–04, in which he announced that OFCCP would start conducting focused reviews. A focused review differs from an audit in that it focuses on one of the three regulations under OFCCP’s enforcement: Executive Order 11246, Section 503, or VEVRAA (https://www.dol.gov/ofccp/regs/compliance/directives/dir2018_04.html), rather than an audit of all three regulatory bodies at once.
In layman’s terms, the focused reviews are mini-audits pertaining to one of three aforementioned regulations, which are intended to effectively reduce the burden of the information requests upon the contractor and the burden of evaluation by OFCCP. Director Leen previously announced that 500 of the 3500 contractors that will receive audit scheduling requests will receive a focused review letter.
DCI has recently discovered that the Section 503 Focused Review Scheduling Letter can be found on the website of the Office of Information and Regulatory Affairs, the agency that falls under the purview of the Office of Management and Budget within the Executive Office of the President (https://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=201811-1250-001). The focused review letter was considered a ‘non-material change’ to the prior scheduling letter approval process, and thus was not released for public comment again.
Contractors familiar with Audit Scheduling Letters will find that, for the most part, the Section 503 Focused Review Letter reflects the reduced scope of a focused review accordingly. It asks contractors to provide the same materials requested under the Section 503 portion of the typical Audit Scheduling Letter, which includes the following items:
- A copy of the current Section 503 AAP.
- The formation of job groups (covering all jobs) – Note, this is typically provided as a part of the EO 11246 compliant Affirmative Action Plan, but is a logical request for a focused review.
- Results of the evaluation of the effectiveness of outreach and recruitment efforts intended to identify and recruit qualified individuals with disabilities.
- Documentation of all actions to comply with audit and reporting requirements.
- Documentation of the related 44(k) analytics for the preceding AAP year, and if you are 6 months into the current AAP year, an update on the relevant 44(k) analytics.
- The Utilization Analysis for Individuals with Disabilities. If the contractor is 6 months or more into their AAP year at the time of the audit, they are also required to provide current year progress.
- A copy of the collective bargaining agreement, if applicable.
- Copies of reasonable accommodation policies.
- The most recent assessment of personnel processes, as required by 41 CFR § 60-741.44(b).
- The most recent assessment of physical and mental qualifications.
There are, however, two notable exceptions that we would like to highlight to the contractor community.
Specifically, OFCCP’s current draft of the Section 503 focused review first requests “A copy of your current Executive Order 11246 Affirmative Action Program (AAP) prepared in accordance with the requirements of 41 CFR § 60-1.40, and 41 CFR § 60-2.1 through § 60-2.17.” This information request appears to fall outside the intended scope of a Section 503 focused review by asking for information pertinent to EO 11246. The requested item seems to contradict the information given in directive DIRECTIVE (DIR) 2018–04, where OFCCP states that “the compliance officer would review policies and practices of the contractor related solely to Section 503 compliance.” DCI has asked for clarification on this specific information request.
Additionally, item 8 on the focused review letter asks for copies of the prior 3 years of EEO-1 filings. This is the same as a typical audit scheduling letter. Yet, EEO-1 filings outline the minority and female representation of the establishment, and do not pertain to individuals with disabilities. While this report does not appear to be directly pertinent to the Section 503 regulations, contractors are supposed to be able to readily provide this report due to their status as a contractor – we speculate this might be part of an effort by OFCCP to ensure that contractors are creating and maintaining the reports required of them.
Please stay tuned for further guidance as DCI clarifies the items requested on the focused review letter that are outside the scope of Section 503.
By Joanna Colosimo, Director of EEO Compliance & Principal Consultant, and Alexander Hsu, HR Analyst at DCI Consulting Group