New OFCCP regulations – Decoded

MattThe new regulations governing the VEVRAA and Section 503 of The Rehabilitation Act, passed by the Department of Labor OFCCP office, are game changers.  There is much confusion and many unanswered questions among federal contractors.  How does one survive an OFCCP audit in the light of such stringent and sometimes conflicting requirements?  To decode and demystify the new rules, Matthew J. Camardella Esq. of Jackson Lewis was at the inaugural compliance conference, hosted by America’s Job Exchange (AJE) in September, to shed some much needed light on the matter.

Matt is a partner in the Affirmative Action Practice Group at Jackson Lewis LLP, a national firm defending management in employment and labor matters. The firm has extensive experience in preparing AAPs and defending companies during an OFCCP audit.

The newly released game-changing veterans and disabled regulations were explained by Matt and what it means for employers. OFCCP has delivered new regulations to the Office of Management and Budget (OMB) in July 2013, and the OMB approved the new regulations August 27, 2013. They come with enhanced obligations to document employer decisions, have new data collection requirements and the need to keep records for a longer time, namely three years.  Trickiest part is that there are increased number of “unknowns” during OFCCP audits.

At the time of the conference, these regulations had not yet gone into effect but they will within 180 days after the Final Rule is published in the Federal Register and which happened on September 24, 2013.  Therefore the new rules go into effect March 24, 2014.  However, employers with AAPs in place on effective date may wait till next annual AAP cycle to implement the new regulations.

For the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) of 1974, regulations have been unchanged since 1976.  The new regulations mandate all employers to invite all “applicants” to voluntarily self-identify at the pre-offer stage as a protected veteran (in general terms).  Employers must invite all “offers” to voluntarily self-identify as a specific category of protected veterans.  There are also new ways to analyze data gathered that will highlight the number of total applicants who are protected veterans, total number of job openings and number of jobs filled, total number of applicants for all jobs, total number of protected vets hired and total number of applicants hired.  This data has to be maintained for three years.  Moreover, there is an 8% hiring benchmark for protected veterans.  Additionally, all “good faith” efforts need to be documented efficiently.

For new rules governing Section 503 of The Rehabilitation Act, employers need to solicit disability status from applicants using the form OFCCP provides, and from all candidates, post offer.  Every five years the entire workforce has to be surveyed for disability.  However, when the new regulations become effective, all current employees have to be surveyed to establish a baseline.  Additionally, there is a 7% utilization goal for every job group whereby making it mandatory to have 7% of employees be disabled in every job group except for contractors who have less than 100 employees.

No doubt the cost of compliance will increase.  Do employers need to outsource certain compliance functions, or staff their organization in a way to handle these new regulations?  Record keeping under the new rules is going to be more stringent as well as double the AAP statistical and analytics obligations.  Matt ended his presentation by posing a key question for the employers to consider, namely, what kinds of training must be provided for recruiters, HR, Legal Department and managers to make sure these regulations are complied with.

In the next 6 months the OFCCP website will have pertinent information.  Visit also www.americasjobexchange.com to view the  slides of the  record keeping webinar recently held by Rathin Sinha, Founder and President, America’s Job Exchange and Julia Mendez, Chief Business Consultant, Peoplefluent and also the compliance page of AJE’s website.

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