Guide for Small Businesses with Federal Contracts
Are you a business or organization doing business with the Federal government with a contract amount over $10,000? If so under Executive Order 11246, you are most likely considered a Federal contractor and the regulations enforced by the U.S. Department of Labor's Office of Federal Contract Compliance Programs (OFCCP), which governs affirmative action (AA) and equal employment opportunity (EEOC) as it relates to hiring and employment practices, apply to you.
Through its regulations, the OFCCP requires Federal contractors and subcontractors to engage in job posting and reporting procedures to make jobs available to diversity groups including veterans, individuals with disabilities, minorities and women, as well as other protected segments of the jobs market.
If you are a small business with a government contract, here are six key things about OFCCP compliance that you should know.
- Understand the mandatory job listing and reporting requirements. As a Federal contractor you need to be prepared in proving that you are actively working with state workforce agencies, posting jobs and keeping records of applicants. OFCCP job listing requirements mandate that all jobs (except for executive level positions, positions lasting 3 days or less, or positions that are filled internally) be distributed and made available to all qualified individuals, regardless of minority status. This includes following procedures to ensure that state employment agencies are informed of job vacancies, so that these postings reach a diverse group of potential employees.
- Have data readily available. Preparing hiring data is a core component of the compliance process. It is imperative that employers proactively maintain data on job postings and have this available for submission should they be required to do so during an audit, and on an annual basis. An effective avenue is to work with job boards that focus on OFCCP compliance as they can assist in maintenance and submission of reports as required. You should also be diligent in maintaining all internal records as it relates to hiring, including compensation data, personnel files, and other policies and procedures.
- Have an AA plan at the ready. Make sure that your staff is well-versed and participates in affirmative action and equal opportunity hiring practices. For a compliance strategy to be effective your AA plan should be developed, communicated and implemented by any and all employees involved in hiring and your diversity initiatives.
- Have your job posting and reporting strategies in place. Job posting requirements are at the core of meeting compliance parameters. You are required to make job openings available to state agencies and other employment service delivery systems that reach protected veterans under VEVRAA, and others with minority status, so that they have priority access to job listings. And as we already noted, you also need to maintain data on job postings, and submit reports as required.
- Know the laws governing OFCCP. Multiple laws have been enacted which impact affirmative action and EEO hiring, including the Rehabilitation Act, of which Section 503 requires affirmative action for individuals with disabilities. Another, the Vietnam Era Veterans' Readjustment Assistance Act (VEVRAA), which was enacted in 1974, mandates that those doing business with the government ensure their job openings reach qualified Vietnam era veterans returning home from the war and that there is no discrimination in the hiring process. If you and your staff are not familiar with these and other laws governing OFCCP requirements, make sure they are now.
- Be prepared for the OFCCP audit process. During an OFCCP audit you will be required to submit hiring data, including internal records related to your hiring practices. This includes - and is not limited to - compensation data, personnel files, and other policies and procedures. Be ready to be audited at any time and understand the elements of the audit process. Being well prepared in advance of any audit can help you respond and move the process along.
To learn more about OFCCP compliance, visit our Compliance Center.