EEO Compliance

OFCCP EEO Compliance

The OFCCP guide is designed to give small businesses that have Federal contracts or subcontracts an introduction to the basic equal employment opportunity (EEO) requirements of Executive Order 11246, as amended, and its implementing regulations, which prohibit employment discrimination by Federal contractors and subcontractors and federally-assisted construction contractors and subcontractors. Executive Order 11246 also requires Federal contractors and subcontractors and federally-assisted construction contractors and subcontractors to take affirmative action to ensure that all individuals have an equal opportunity for employment without regard to race, color, religion, sex, or national origin.

The United States Department of Labor's Office of Federal Contract Compliance Programs (OFCCP) administers and enforces Executive Order 11246 and its implementing regulations. OFCCP also enforces Section 503 of the Rehabilitation Act of 1973, which prohibits discrimination against qualified individuals with disabilities, and the affirmative action provisions of the Vietnam Era Veterans' Readjustment Assistance Act, which prohibits discrimination against qualified protected veterans.

This guide is intended for contractors that have nonconstruction contracts, which are also referred to as "supply and service" contracts. This guide is also for subcontractors that furnish supplies or services that are necessary to perform a Federal contract. While the basic EEO requirements are the same for all contractors and subcontractors, both construction and nonconstruction, a different set of affirmative action requirements have been established for contractors that have construction contracts. If your business has a Federal construction contract or a contract for construction work that is paid for with Federal funds, the affirmative action requirements that apply only to Federal or federally assisted construction contractors and subcontractors are set forth in the regulations in 41 CFR Part 60-4, and explained in OFCCP's Technical Assistance Guide for Federal Construction Contractors.

The basic EEO requirements of Executive Order 11246 are discussed in this guide. In addition to the basic EEO requirements, the regulations implementing Executive Order 11246 require supply and service contractors - generally, those with 50 or more employees and a contract of $50,000 or more - to develop and maintain a written affirmative action program (AAP). A detailed description of the written AAP requirements is beyond the scope of this guide. However, the AAP requirements for supply and service contractors are contained in 41 CFR Part 60-2, and guidance about how to comply with the AAP requirements is provided in the Federal Contract Compliance Manual.

This guide describes practical steps that can be taken to comply with some of these requirements. This guide is divided into three parts. Part I explains the basic EEO requirements of Executive Order 11246 and its implementing regulations. Part II provides examples of effective employer practices that foster equal employment opportunity and can help small businesses comply with some of their AAP requirements. Part III contains a directory of OFCCP offices.

Contractors have considerable flexibility in devising practices and programs that promote equal employment opportunity. The employer practices found in the guide are illustrative and should not be construed as requirements. Moreover, this guide does not create new or change current legal requirements.

What is OFCCP?

OFCCP is an agency within the U.S. Department of Labor's Employment Standards Administration. OFCCP has a national network of six Regional Offices, each with District and Area Offices in major metropolitan cities.

OFCCP conducts compliance evaluations to determine whether a contractor is complying with its obligation to maintain nondiscriminatory employment practices. OFCCP also investigates complaints filed against a Federal contractor that suggest discrimination against a group of individuals or discrimination that is systemic in nature. If the complaint alleges that a Federal contractor discriminated against an individual, OFCCP will refer the complaint to the Equal Employment Opportunity Commission (EEOC) for processing.

OFCCP encourages voluntary compliance and provides compliance assistance regarding the requirements of the EEO laws that apply to Federal contractors and subcontractors. You may find out more about OFCCP by accessing the OFCCP website .

How do I know if I am a Federal contractor or subcontractor subject to Executive Order 11246?

Basically, all Federal contracts and subcontracts are covered under Executive Order 11246 unless specifically exempted. Contracts and subcontracts of less than $10,000 generally are exempt from coverage under Executive Order 11246, though some contracts under that amount are covered, e.g. bills of lading. The regulations implementing the Executive Order exempt certain contracts and categories of contracts. The regulations contain exemptions for contracts involving work performed outside the United States; certain contracts with State or local governments; contracts with religious corporations, associations, and educational institutions; and contracts involving work on or near an Indian reservation. For a description of the exemptions, see the regulations 41 CFR 60-1.5. Additional assistance for determining whether a business is a Federal contractor may be found on DOL's e-laws website.

What is a Federal contract or subcontract?

A "Federal contract" is any agreement between a department or agency of the Federal Government and any person for the purchase, sale, or use of goods or services.

A "Federal subcontract" is an agreement or arrangement with a Federal contractor either (1) for the furnishing of supplies or services or for the use of real or personal property, which is necessary to the performance of any one or more Federal contracts; or (2) under which any portion of the Federal contractor's obligation under any contracts is performed, undertaken, or assumed. Thus, some but not all contracts with a Federal contractor will trigger coverage under the laws administered by OFCCP.

What are the basic EEO requirements of a Federal Contractor?

The basic EEO requirements of a Federal contractor are:

Don't Discriminate

Post EEO Posters

Include the EEO Tag Line in Employment Advertising

Keep Records

Permit OFCCP Access to Books and Records During a Complaint Investigation or Compliance Evaluation

File an Annual EEO-1 Report

Don’t Discriminate

Title VII of the Civil Rights Act of 1964, as amended (Title VII), is a Federal law that protects individuals against employment discrimination. Executive Order 11246 is similar to Title VII. Executive Order 11246 prohibits Federal contractors and subcontractors from engaging in workplace employment discrimination on the basis of race, color, religion, sex, or national origin.

What is Employment Discrimination?

Employment discrimination takes different forms. Employment discrimination is illegal and generally results when a person is treated differently (usually less favorably) because of his or her race, color, religion, sex, or national origin. In addition, employment discrimination can result when a neutral policy or practice has an adverse impact on the members of any race, sex, or ethnic group and the policy or practice is not job related or required by business necessity.

Here is an example of prohibited employment discrimination:

Alpha Production Company needs to hire entry-level laborers. The job requires heavy lifting and physical exertion, but does not require any technical skill. Alpha Production believes that all of its employees should have a high school diploma. So the company does not consider applicants who did not finish high school for the laborer job.

The high school diploma requirement disqualifies a greater number of Hispanic candidates for the laborer job at Alpha Production than Non-Hispanic White candidates. According to the most recent Census data, in the counties from which Alpha Production draws its applicants for laborer jobs, 94.2% of the white population 18 years and older has completed high school, but only 46.9% of the Hispanic population 18 years and older has completed high school. Alpha Production could not provide a business justification for using the high school diploma requirement. Thus, Alpha Production has engaged in prohibited discrimination.

Be Very Careful With Employment Tests:

Professionally developed tests can be used to make employment decisions, so long as the tests are fair and nondiscriminatory. You should be aware of the legal requirements that apply when tests and other assessment instruments are used to select employees. We recommend reviewing the guide developed by O*Net and titled Testing and Assessment: An Employer's Guide to Good Practices, which is available on the DOL website. In addition, you might consult legal counsel or a Human Resource advisor before instituting any employment tests.

Post EEO Poster:

Federal contractors are required to post OFCCP's Equal Employment Opportunity Poster in a conspicuous place. A good place to post it is in a locker or lunchroom or an area where employees can take breaks. You can obtain the Equal Employment Opportunity Poster by contacting the nearest OFCCP office. A Directory of OFCCP offices is found in Part III of this guide. You can see a sample poster on the OFCCP website.

Include Tag Line in Advertising:

Federal contractors are required to state in all solicitations or advertisements for employment that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, or national origin.

Keep Records:

Federal contractors are required to maintain any personnel or employment records made or kept by the contractor.

Examples of records that must be maintained:

Job descriptions

Job postings and advertisements

Records of job offers

Applications and resumes

Interview notes

Tests and test results

Written employment policies and procedures

Personnel files

Time Periods for Keeping Employment Records:

Two years from the date of the making of the personnel record or the      personnel action, whichever occurs later.

But contractors with fewer than 150 employees or a contract of less than      $150,000 have to keep records for only one year.