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Equal Employment Opportunity: Strengthening Oversight Could United States Government Accountability Office Report to Congressional Requesters September 2016 EQUAL EMPLOYMENT OPPORTUNITY Strengthening Oversight Could Improve Federal Contractor Nondiscrimination Compliance GAO-16-750 September 2016 EQUAL EMPLOYMENT OPPORTUNITY Strengthening Oversight Could Improve Federal Contractor Nondiscrimination Compliance Highlights of GAO-16-750, a report to congressional requesters Why GAO Did This Study What GAO Found OFCCP is charged with ensuring that Since 2010, most compliance evaluations conducted by the Department of about 200,000 federal contractor Labor’s (DOL) Office of Federal Contract Compliance Programs (OFCCP) of establishments refrain from federal supply and service contractors identified no violations; however, the discrimination and take affirmative methods used may not focus evaluations on contractors posing the greatest risk. action to provide equal employment OFCCP relies on compliance evaluations to detect equal employment violations opportunities for certain protected by federal contractors and conducts evaluations for about 2 percent of federal classes of workers. GAO was asked to contractor establishments annually. Since 2010, about 78 percent of evaluations review OFCCP practices. found no violations and about 2 percent had discrimination findings (see figure). In this report, GAO (1) assessed how However, when it selects contractors for evaluations, OFCCP does not use a OFCCP conducts supply and service generalizable sample that would allow for conclusions about the federal compliance evaluations, including the contractor population. Therefore, it does not have reasonable assurance that it is methodology, resources, and results, focusing its compliance efforts on those contractors with the greatest risk of and (2) evaluated OFCCP outreach, noncompliance. During evaluations, OFCCP requested and reviewed documents assistance, and guidance efforts to related to contractors’ equal employment efforts, including their Affirmative Action assist contractors in complying with the Program (AAP), which outlines contractors’ compliance efforts. In 2015, close to requirements it enforces. GAO 85 percent of evaluated contractor establishments did not submit their AAP within analyzed both OFCCP Information 30 days of OFCCP’s request and were granted extensions in some cases. This System data and a nongeneralizable suggests that OFCCP processes do not ensure that all contractors are complying sample of 43 case files and reviewed with their obligation to complete and annually update an AAP. relevant federal laws, executive orders, regulations, guidance, and agency Figure: Findings of Federal Contractor Nondiscrimination Compliance Evaluations From documents. GAO also interviewed a Fiscal Years 2010-2015 nongeneralizable sample of 24 contractors with and without experience with a compliance evaluation; managers and staff in OFCCP’s headquarters and all six regional offices; and representatives of national organizations representing contractors and protected workers’ interests. What GAO Recommends GAO is making six recommendations Since 2012, OFCCP’s outreach and compliance assistance activities to assist to DOL, including that OFCCP develop contractors and other stakeholders, such as protected workers and industry a contractor selection process that groups, have declined as the agency refocused its activities on enforcement, and reflects contractor noncompliance risk, some stakeholders said guidance could be clearer. Outreach activities, such as develop a mechanism to monitor community group presentations and job fair participation, decreased more than contractors’ compliance with AAP 80 percent from 2012 to 2014. Some stakeholders told GAO that workers, requirements, and review and assess applicants, and contractors may benefit from more outreach activities. OFCCP’s the clarity of its contractor guidance. compliance assistance activities, such as seminars, for contractors—are down 30 DOL agreed with GAO’s percent since 2012. Many contractors told GAO they do not feel comfortable recommendations. contacting OFCCP for assistance and hire third party support to help comply with federal nondiscrimination and affirmative action requirements. While contractors generally found OFCCP guidance helpful, both stakeholders and contractors said View GAO-16-750. For more information, the guidance could be clearer to help them understand the requirements. Without contact Cindy Brown Barnes at (202) 512- clear guidance, contractors may not be able to understand their equal 7215 or [email protected]. employment obligations. United States Government Accountability Office Contents Letter 1 Background 4 OFCCP’s Compliance Evaluations Have a Number of Weaknesses that Impact the Effectiveness of its Enforcement Efforts 15 OFCCP Outreach and Compliance Assistance Activities Have Decreased and Stakeholders Reported Need for Improvement 28 Conclusions 36 Recommendations for Executive Action 37 Agency Comments and Our Evaluation 38 Appendix I The Laws and Executive Order Enforced by the Office of Federal Contract Compliance Programs (OFCCP) 39 Appendix II Selected Federal Laws and Executive Orders Related to Labor and Employment Specific to Federal Contractors 42 Appendix III Comments from the Department of Labor 45 Appendix IV GAO Contact and Staff Acknowledgments 51 Tables Table 1: Types of Violations Cited by the Office of Federal Contract Compliance Programs (OFCCP) as a Result of Compliance Evaluations in Fiscal Years 2010-2015 16 Table 2: Remedies Included in Conciliation Agreements to Address Federal Contractor Discrimination Findings, Fiscal Years 2010-2015 25 Figures Figure 1: Selected Equal Employment and Affirmative Action Recordkeeping, Reporting, and Access Requirements for Page i GAO-16-750 Equal Employment Opportunity a Federal Supply and Services Contractor Under Executive Order 11246 7 Figure 2: Typical Office of Federal Contract Compliance Programs (OFCCP) Compliance Evaluation Process 13 Figure 3: Compliance Officer Distribution Across 48 Office of Federal Contract Compliance Programs (OFCCP) District and Area Offices 20 Abbreviations AAP Affirmative Action Program ACE Active Case Enforcement ACM Active Case Management ARB Administrative Review Board CSAL Corporate Scheduling Announcement Letter DFARS Defense Federal Acquisition Regulation Supplement DOL Department of Labor EEOC Equal Employment Opportunity Commission FAQs Frequently Asked Questions FAR Federal Acquisition Regulation FPDS-NG Federal Procurement Data System-Next Generation FKGL Flesch-Kincaid Grade-Level FTE full-time-equivalent MOU memorandum of understanding OFCCP Office of Federal Contract Compliance Programs OMB Office of Management and Budget VETS Veteran’s Employment and Training Service VEVRAA Vietnam Era Veterans’ Readjustment Assistance Act of 1974 This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately. Page ii GAO-16-750 Equal Employment Opportunity Letter 441 G St. N.W. Washington, DC 20548 September 22, 2016 The Honorable John Kline Chairman Committee on Education and the Workforce House of Representatives The Honorable Tim Walberg Chairman Subcommittee on Workforce Protections Committee on Education and the Workforce House of Representatives The Department of Labor’s (DOL) Office of Federal Contract Compliance Programs (OFCCP) is responsible for ensuring that about 200,000 federal contractor establishments comply with federal equal employment opportunity and affirmative action requirements. Under an executive order and other federal laws and regulations, covered federal contractors and subcontractors are prohibited from discriminating and are required to take affirmative action to: (1) ensure that all applicants and employees are treated without regard to race, color, religion, sex, sexual orientation, gender identity, or national origin, and (2) employ or advance in employment qualified individuals with disabilities and, qualified covered veterans.1 These requirements affect about one out of every four U.S. workers. Since fiscal year 2011, OFCCP has changed its enforcement practices and updated its regulations to, among other things, reflect recently issued amendments to Executive Order 11246 that established new nondiscrimination requirements, and to increase contractors’ collection of data on workers’ and applicants’ veteran and disability status. Protected worker advocacy organizations have lauded OFCCP’s efforts and many 1OFCCP enforces Executive Order 11246; Section 503 of the Rehabilitation Act of 1973; and the affirmative action provisions of the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, all as amended, which apply to federal contractors and subcontractors if they meet specific criteria, including contract dollar amount and employee count thresholds. OFCCP’s implementing regulations for Executive Order 11246 and these laws may be found at 41 C.F.R. pts. 60-1 to 60-999. Page 1 GAO-16-750 Equal Employment Opportunity of these changes. However, other stakeholders, including some in the federal contracting community, are concerned OFCCP’s efforts are imposing excessive compliance burdens on contractors, including what they perceive as overly broad and
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