Welcome to HudsonMann’s OFCCP updates for 2018.  There have been some interesting behind-the-scenes developments that we’re eager to share with you, but first and foremost we’ll start this mid-year recap with and update on OFCCP’s audit activity.

In the first two quarters of Fiscal Year 2018, OFCCP has:

  • Recovered $7.7 Million dollars in monetary relief, much of this is from large pay discrimination settlements
  • They’ve also Completed 277 Supply and Service Audits (and scheduled 238)
  • And 27 construction compliance evaluations (most are related to mega construction projects)
  • OFCCP has also investigated 41 complaints

With 1,000 establishments added to the audit scheduling list earlier this year, we anticipate OFCCP audit activity to continue picking up speed throughout the year.  This is supported by our next topic – OFCCP’s budget justification.

When OFCCP requests its budget each year, they also lay out their priorities for the coming fiscal year.  And this year’s budget request document is illuminating.

The first priority is a focus on “streamlined high-impact systemic compliance evaluations.”  This seems to echo the Active Case Management framework utilized under the Bush administration which was replaced under the Obama administration.  Under that framework, compliance officers would quickly close cases that did not have evidence of systemic discrimination involving at least three employees or applicants.  This allowed OFCCP to conduct lots of audits with many being fairly limited in scope.  The 2019 budget request seems to foreshadow a return to a similar model.

The second priority is “significantly expanding contractor compliance assistance” including training and education, incentives and recognition programs.

Third is “improving organization efficiency and effectiveness.”  The key steps towards this objectives are establishing Skilled Regional Centers with “highly skilled and specialized compliance officers” and a restructuring of the field, area and district offices.

OFCCP has proposed to accomplish this with a $12M decrease from currently enacted budget levels.  Budget documents state that the decrease stems from “efficiencies gained through reorganization” and also call for a staff reduction of 75 FTE’s.  While the house budget committee did approve the proposed funding levels, OFCCP received more budget than initially requested for FY 2018.  Where the budget discussion goes in Congress is anyone’s guess.

Speaking of lawmaking, we’ll close with two areas where OFCCP is anticipating some congressional action.

The first regards Tricare subcontractors.  In May OFCCP extended their enforcement moratorium on TRICARE providers until May 7, 2021.  The moratorium began in 2014 in response to a lack of clarity on whether TRICARE subcontractors fall under OFCCP’s jurisdiction.  The new directive states that “OFCCP understands that Congress may enact legislation affecting this area in the near future.”  The moratorium has also been expanded to apply to subcontractors under the Veterans Affairs Heath Benefit Program.

Finally, there’s talk of another merger involving OFCCP.  This time it would be part of a larger combination of the Departments of Education and Labor into one, new Department of Education and the Workforce.  If Congress approves this plan, OFCCP would be within the Enforcement Agency within the new department.

That’s it for now – make sure you sign up for HudsonMann’s OFCCP Updates Newsletter to stay on top of the latest news and trends.  Thank you!