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Mar 26, 2014

OFCCP Law Update For our banking clients


Category: Employment

The Office of Federal Contract Compliance Programs (“OFCCP”) has issued new regulations that go into effect on March 24, 2014.  Those regulations affect federal contractors and subcontractors, which the OFCCP defines broadly.  If your company has an affirmative action plan (“AAP”) required by OFCCP, these regulations will affect your company and must be implemented before the expiration of your existing AAP.  Banks are subject to these regulations because financial institutions with federal share and deposit insurance are considered to be government contractors within the meaning of the regulations implementing Executive Order 11246, the Vietnam Era Veterans' Readjustment Assistance Act of 1974 (VEVRAA), 38 U.S.C. 4212, and Section 503 of the Rehabilitation Act of 1973 (Section 503).

The new regulations require that covered employers, including banks, invite all applicants for employment to identify as individuals with disabilities and/or protected veterans at both the pre-offer and post-offer phases of the application process.  There is a particular form that must be used and cannot be changed.  Document when and how the form was distributed for OFCCP compliance purposes.  That same form must be given to folks twice – once at pre-offer and then the exact same form again at post-offer.  Not only does that make little sense but asking twice about disability is going to make some applicants wonder why the employer is so interested in the topic, creating risks under the Americans with Disabilities Act and the Maine Human Rights Act.  It is advisable to include a cover letter or message that makes clear that the form is entirely voluntary on the part of the employee AND that the employer must hand it out. 

In addition, Section 503 requires that covered employers, including banks, extend to their entire workforce an invitation to self-identify as an individual with a disability within the first year that the employer is subject to the self-identification requirement under Section 503.  Employers must send out another reminder to self-identify every five years after that.  In other words, the new form must go to all existing employees, not just applicants, this first time around and then only every five years thereafter.

Employers need to modify their applicant tracking and human resources information systems to comply with the OFCCP’s regulations.  The data gathered should be used to help determine if workplace compliance goals are being met.  Completed forms should be stored separately and in a confidential and locked location; they should not be put into individuals’ personnel files.  Accommodation requests made pursuant to these forms should be maintained in yet another separate file.  Employers should begin soon the process of programming their systems to solicit the information on the new form.  An employer is not in violation of the regulations if it waits until the date of the next regular AAP update to comply with this self-identification requirement although the agency suggests coming into compliance as soon as “practicable” after March 24, 2014.  Call (207) 784-3200 if you have questions.