The U.S. Office of Federal Contract Compliance Programs (OFCCP) is responsible for administering regulations that require companies to provide equal employment opportunities to all qualified individuals without regard to race, color, religion, sex, or national origin. The OFCCP has the authority to impose monetary penalties on companies that fail to comply with its regulations. Here is what you need to know.
Discrimination in hiring practices
Hiring discrimination is considered to be of the most serious nature. The OFCCP considers it a violation if an employer has knowingly and willfully refused to consider qualified individuals for employment or has not taken reasonable steps to prevent such discrimination.
In addition, employers who have failed to take any action necessary to prevent hiring discrimination may also be subject to monetary penalties under the OFCCP’s regulations.
In addition to monetary penalties, the OFCCP can also impose a number of other remedies on employers that violate Title VII.
Discrimination in compensation packages
OFCCP will look at the entire compensation structure and analyze it. It will consider your company’s total compensation package, including base salary, bonus payments, and other forms of compensation, such as stock options or incentive pay. The impact of any incentive plan on compliance with federal law is also important in determining whether you are being discriminatory against a protected group under Title VII.
OFCCP continues to increase its focus on pay discrimination with a team of statisticians concentrating specifically on pay equity in the workplace. Pay equity is an important issue for OFCCP, which uses statistical analysis to determine whether there are differences in pay between groups or if one group has been paid less than another because of their sex, race, or other protected characteristics.
Discrepancies in Recordkeeping
Discrepancies in recordkeeping is another area of non-compliance that can lead to monetary penalties. For example, if you fail to keep accurate records of your job site’s employees, how will you know how many employees are on the premises and what their qualifications are?
OFCCP has wide latitude in using data from other sources as evidence against you during an investigation—and it can even use statistical analysis and an expert witness to prove its case.
One of the most important aspects of a successful OFCCP compliance evaluation is understanding that the agency does not give employers the benefit of the doubt. This means that employers will be held responsible for any violation and could face monetary penalties, even if they have been compliant for years.
The OFCCP team has a number of statistical tools at its disposal to help make judgments about whether or not an employer has complied with equal employment laws. These include:
- Pay gap analyses – Using data from various sources (such as pay scale surveys), pay equity teams can identify areas where women are underpaid compared to men.
- Pay disparity analyses – Using data from pay scales surveys or other public information sources filings on the EEOC website), they look at whether there is any disparity in compensation between genders.
The OFCCP is an important federal agency that touches many employers in every industry. The agency has been renewing its focus on compliance as of late, which means that employers should be aware of their rights and obligations regarding OFCCP compliance. Failure to comply with their regulations can cost you millions and bring your business to a halt.