OFCCP’s Coronavirus Exemption Has Supporters and Critics

Allen Smith, J.D. By Allen Smith, J.D. April 15, 2020
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The Office of Federal Contract Compliance Programs' (OFCCP's) temporary waiver of affirmative action requirements for coronavirus-relief contracts has opened doors to new businesses to fight the pandemic. But civil rights groups protested the move in an April 7 letter, saying the agency isn't fulfilling its mission.

The exemption applies only to federal coronavirus-relief contracts with suppliers, service providers and construction companies entered from March 17 to June 17. The OFCCP might extend the waiver, noted David Cohen, president of DCI Consulting in Washington, D.C.

Exempted contractors still are subject to nondiscrimination and nonretaliation obligations under Executive Order 11246, Section 503 of the Rehabilitation Act and the Vietnam Era Veterans' Readjustment Assistance Act, said Holly Lake, an attorney with DLA Piper in Los Angeles.

[SHRM members-only toolkit: Managing Federal Contractor Affirmative Action Programs]

She explained that the following requirements are waived for exempted contractors:

  • Written affirmative action plans.
  • Equal employment opportunity (EEO) policy statements and other posting requirements.
  • EEO tagline requirements in job postings.
  • Listing job openings with relevant state workforce agencies.
  • Union notices regarding EEO policy statements.
  • EEO-1 filing requirements, provided the contractor has fewer than 100 employees. The Equal Employment Opportunity Commission requires larger employers to file EEO-1 reports. Federal contractors with 50 or more employees ordinarily must file the EEO-1 report.
  • Onsite audits.

Under the OFCCP's regulations, federal contractors usually must list almost all employment openings with the appropriate job bank, said David Goldstein, an attorney with Littler in Minneapolis. He emphasized that "the exemption is not helpful to existing contractors, as it does not impact obligations arising under existing contracts."

SHRM Resource Spotlight
Coronavirus and COVID-19

Why the Exemption?

So what's the point of the exemption for new federal contracts providing coronavirus relief?

With this waiver, companies that may have hesitated to subject themselves to the rigorous affirmative action compliance requirements imposed on federal contractors may be encouraged to provide much-needed goods or services to fight coronavirus, said Cheryl Behymer, an attorney with Fisher Phillips in Columbia, S.C.

"This is an excellent incentive to companies with something significant to offer to the relief efforts," she said. At the end of the crisis, the organizations "can return to their position of not engaging in federal contracts or subcontracts, and they need not worry about future enforcement actions by the OFCCP."
The collection of applicant demographic data needed for affirmative action plans often requires a new contractor to implement a new human resource information system. This "requires time and resources that are above and beyond the typical HR efforts for recruiting," she said.

Other statistical reports required for affirmative action plans require tracking promotions and terminations, in addition to setting hiring goals.

Moreover, during the coronavirus pandemic, HR may be managing headcount and initiating improvements to bolster employee safety. Behymer said these activities "must take precedence over keeping up with affirmative action required reports"—at least for new contractors.

She noted that some employers also are in the middle of layoffs, while others are adding staff. Stepping up recruiting as dramatically as some companies are having to do now "may lead to [otherwise] impermissible shortcuts in how the talent and acquisition process is typically handled to support the affirmative action efforts," she said.

Lake noted that, nonetheless, while onsite audits have been paused, the OFCCP "remains active in conducting its audits and investigations" through such alternatives as Webex, Skype and phone calls.

Groups Call for Waiver's Rescission

Fifty-six civil and workers' rights groups expressed dissatisfaction with the OFCCP's enforcement efforts, calling for the rescission of the waiver.

Describing it as "unnecessarily broad," the groups said it "will cause significant harm to marginalized workers hardest hit by the current crisis" and is at odds with the OFCCP's mission.

"The pandemic and its economic repercussions are disproportionately impacting people of color," wrote the organizations, which include the Lawyers' Committee for Civil Rights Under Law, NAACP and National Partnership for Women & Families.

"The waivers will discourage covered employers responding to the coronavirus pandemic from casting a wide net to recruit diverse workers from historically underrepresented populations," including people with disabilities and lesbian, gay, bisexual, transgender or queer people, the letter stated.

One of the few areas of job growth is among federal contractors seeking to respond to the coronavirus crisis, the groups noted. The "OFCCP must ensure that working people experiencing high levels of job loss and most vulnerable to a recession are not left out of the response and recovery efforts."

Massive layoffs are disproportionately impacting black and Latino workers, including women of color who are overrepresented in low-wage service jobs, the letter stated. In addition, "racial minorities are about twice as likely to subsist on poverty-level wages as compared to their white counterparts, and as a result have fewer savings and resources upon which they can rely to weather this crisis."

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