The DOL’s Office of Federal Contract Compliance Programs (OFCCP) has issued a directive outlining Active Case Enforcement (ACE) procedures for conducting Supply & Service (S&S) compliance evaluations. In December 2010, the agency issued a directive to discontinue the former ACE process that had been in place since 2003. According to the agency, the former system was “primarily an abbreviated desk audit process” to expedite the closing of S&S contract compliance evaluations where there existed no evidence of systemic discrimination. The agency claimed that the former process “eroded” its enforcement authority and was of “limited utility.” According to the new directive, the updated ACE process “will more effectively utilize [the OFCCP’s] resources and strengthen its enforcement efforts.”
Effective as of January 1, 2011, the new directive outlines the following basic principles and procedures applicable for S&S contractors:
- All S&S contractors selected for review by the Federal Contractor Scheduling System (FCSS) will be required to submit their Affirmative Action Plans (AAPs) and supporting documentation to the OFCCP.
- A full desk audit will be performed in every compliance evaluation to ensure the contractor’s compliance with Executive Order 11246 (EO 11246), Section 503 of the Rehabilitation Act of 1973 (Section 503) and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA).
- For quality control purposes, every 25th federal contractor establishment will be selected by FCSS for a full compliance review.
- Indicators of potential discrimination may be of an individual and/or class (i.e., two or more victims) nature.
- Whenever an onsite review is conducted, the compliance officer will document the contractor’s compliance with Executive Order 13496, which requires notification to employees of their rights under the National Labor Relations Act (NLRA).
- Contractor establishments that have undergone a compliance evaluation will be excepted from scheduling from the FCSS for another compliance evaluation of any kind for 24 months from the date of closure of the compliance evaluation.
The directive states that the OFCCP is to use administratively neutral selection criteria to select S&S establishments for audits. Once a contractor is selected for review, the agency is directed to take the following steps:
- Coinciding with the mailing of the scheduling letter, OFCCP will contact the Equal Employment Opportunity Commission (EEOC) and the state and/or local Fair Employment Practice (FEP) agency to determine the nature, status and outcome of any complaints that have been filed against the contractor at the establishment under review.
- The Compliance Officer (CO) will conduct a full desk audit in every compliance review and evaluate the contractor’s compliance with its obligations under EO 11246, Section 503, and VEVRAA.
- The CO will review the contractor’s compliance history for the past three years, to assess the contractor’s recent compliance history and determine if there are patterns of non-compliance. To do this, the CO will use the OFCCP internal database system, and review any information received from EEOC, state or local FEP, and/or other labor and employment agencies, such as the Department of Labor’s Veterans’ Employment and Training Service and Wage and Hour Division.
- The CO will determine whether there are indicators of potential discrimination or violation that will require an on-site investigation. In addition to statistical and anecdotal evidence of discrimination, indicators of potential discrimination/violation also include, but are not limited to: patterns of individual discrimination, patterns of systemic discrimination, patterns of major technical violations such as recordkeeping deficiencies or failure to maintain an AAP, and non-compliance with other labor and employment laws, e.g., wage and hour laws.
- If the contractor’s AAP or supporting documents submitted are insufficient to make a compliance determination, the CO may elect to proceed to the on-site investigation.
- The CO may close the compliance review at the conclusion of the desk audit, if no indicators of potential discrimination/violation are found. However, if the compliance review is designated as the “quality control” review or a focused review, the CO must conduct an on-site review, even in the absence of indicators.
- If indicators are identified during the desk audit, the CO may conduct an on-site review of the contractor’s compliance with all of the laws enforced by OFCCP.
- An on-site review is not limited to the nature or scope of the indicators that triggered the on-site review.
- Where an on-site review is conducted, the CO will also document the contractor’s compliance with Executive Order 13496.4.
- During the desk audit, if minor technical violations are identified and there are no indicators of potential discrimination, the CO should try to remedy the deficiencies at this stage.
- If the compliance review indicates that there is no potential discrimination or unresolved minor technical violations with EO 11246, Section 503 or VEVRAA, the CO will follow established closure procedures and issue the Closure for No Apparent Violations or Technical Violations.
- At the conclusion of an investigation where major technical violations were resolved and/or discrimination was remedied through a conciliation agreement, the CO will issue the appropriate closure document(s), including the Closure Letter for Substantive Violations.
- If the contractor denies OFCCP access or refuses to provide requested information, the CO will follow the show cause notice procedures as appropriate.
The directive includes sample closure letters.
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