April 16, 2020

What’s New in the Latest OFCCP Scheduling Letters?

In April 2019, the Office of Federal Contract Compliance Programs (OFCCP) proposed substantive revisions to the Scheduling Letter and Itemized Listing, the Compliance Check Letter, and the Section 503 of the Rehabilitation Act of 1973 (Section 503) Focused Review Letter, in addition to introducing the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) Focused Review Letter. A month later, after receiving public comments regarding the proposed changes, the OFCCP pulled back certain requirements in the proposed letters and submitted them to the Office of Management and Budget (OMB) for final approval.

OMB recently approved the revised scheduling letters, but fortunately did not adopt all of OFCCP’s proposed changes, including proposed changes to request compensation information during focused reviews. While the new Compliance Check Letter remains substantively unchanged, a few differences exist among and between the other scheduling letters.

In the new Scheduling Letter and Itemized Listing, contractors must now “describe the specific good faith efforts made to remove identified barriers, expand equal employment opportunity, and produce measurable results” when goals are not attained. See Itemized Listing § 17(c). Additionally, contractors must submit a description of their personnel processes assessment and a schedule of the physical and mental qualifications assessment. See Itemized Listing §§ 21-22.

Under the new Section 503 Focused Review, contractors no longer need to submit data regarding the formation of job groups, documentation of all actions taken to comply with the audit and reporting system requirements, or copies of EEO-1 Reports for the last three years. Alternatively, for Section 503 Focused Reviews, contractors must now submit a description of the assessment of personnel processes and a schedule of the physical and mental qualifications assessment, which mirrors the new Scheduling Letter and Itemized Listing. See Section 503 Focused Review §§ 8-9.

The inaugural VEVRAA Focused Review Letter essentially mirrors the new Section 503 Focused Review Letter. Notably, to the extent the focused review data is maintained electronically, contractors must now submit it in a complete, readable and usable format. Unlike the Section 503 Focused Review, however, the VEVRAA audit letter seeks documentation regarding hiring benchmarks. See VEVRAA Focused Review letter § 5.

Note that the OFCCP remains “virtually” operational during the COVID-19 pandemic; therefore, contractors listed on the previously issued Corporate Scheduling Announcement Letter (CSAL) should begin to gather the requested data in the VEVRAA audit letter.

Contractors should also be mindful that the new obligations may apply not only to OFCCP audits, but to general contract compliance as well. Going forward, contractors are certifying their compliance with requirements that are less than concrete and to which enforcement remains uncertain, such as using “good faith efforts made to remove identified barriers, expand equal employment opportunity, and produce measurable results.” Accordingly, contractors should review and update as appropriate their relevant standard operating procedures (SOPs) and codes of ethics and business conducts to help insulate themselves from contractual and legal liability, particularly with regard to the False Claims Act.

Faegre Drinker will continue to assess changes in the recent scheduling letters and report any other notable findings.

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