Several new developments have come from the Department of Labor, Office of Federal Contract Compliance Programs (OFCCP) this week.
In a notice published to the Federal Register on September 2, 2021, the OFCCP announced that it is revisiting its current position on Component 2 pay data, collection of which was suspended during the Trump administration.
At the end of 2019, the OFCCP had decided that it would not request, accept or use employers’ Component 2 pay data, but now “[t]he agency has determined that it was premature to issue a notice stating [the] OFCCP did not expect to find significant utility in the data.” Instead, according to the OFCCP, “there are substantial reasons to believe that the Component 2 data could be useful to [the] OFCCP’s enforcement.” The OFCCP intends to study the utility of the data and may revise its previous stance based on its findings.
In other news, the White House has cleared the OFCCP’s initiative that would require federal contractors to certify that they have affirmative action plans in place. Currently, federal contractors are required to create affirmative action plans within 120 days of beginning a contract. But the OFCCP only reviews the plans after a company is selected for audit. Under the new verification interface, companies would be required to certify affirmatively that the plans are in place. The OFCCP would then verify that contractors are annually certifying compliance with federal contracting obligations and schedule more targeted reviews for those contractors who have not provided certifications. The OFCCP solicited comments on the verification interface beginning in September 2020, and the Office of Information and Regulatory Affairs concluded its review on August 31st.
Employers subject to the OFCCP’s rulemaking should stay tuned to see what conclusions come from these developments, and be ready to adjust their practices to maintain compliance with any new rules in the coming months.