Labor and Employment Law Handling an OFCCP Audit: Key Mistakes to Avoid. Tuesday, October 16, :00 p.m. 1:00 p.m.

Transcription

1 Labor and Employment Law Handling an OFCCP Audit: Key Mistakes to Avoid Tuesday, October 16, :00 p.m. 1:00 p.m. CST Web Seminar

2 Continuing Education Information We have applied for one hour of California, Texas and Virginia CLE, New York non-transitional CLE and HRCI credit. Newly admitted New York attorneys may not receive non-transitional CLE credit. For attendees outside of these states, we will supply a certificate of attendance which can be used to apply for CLE credit in the applicable bar or other accrediting agencies. Fulbright will supply a certificate of attendance to all participants that: Participate in the web seminar by phone and via the web. Complete our online evaluation, which we will send tomorrow. 2

3 Continuing Education Information (Cont.) For those attorneys requesting New York State CLE credit for this presentation, please record the number given during the program. You will be asked to repeat this number on an online evaluation regarding the program, which Fulbright will to you tomorrow. If you are viewing i a recording of this web seminar, most state bar organizations will only allow you to claim self-study CLE credit. Please refer to your state's CLE rules. If you have questions regarding CLE approval of this course in your applicable bar, please contact your bar administrator. 3

4 Today s Speaker Shafeeqa Watkins Giarratani Attorney at Law Fulbright & Jaworski L.L.P. Specializes in OFCCP regulations & affirmative action audits Successfully handled numerous audits for federal contractors from desk audit to conciliation Lead counsel in several potentially multi-million dollar audits 4

5 Fulbright s Affirmative Action Team Provide clients with: Cost-effective, high-quality affirmative action plans Audit support based on legal expertise and understanding of the players Proactive approach to identifying if i and resolving issues Focus on keeping clients up-to-date on latest developments 5

6 Today s Agenda 1. The OFCCP behind the scenes 2. Knowing how to respond to an audit letter 3. Understanding what the OFCCP looks for 4. Responding to follow-up requests 5. What the OFCCP does with your data 6. Preparing for an on-site visit 7. Negotiation opportunities 8. Confidentiality... and preparing for disclosure 9. Anticipating future requirements of the OFCCP 6

7 Understanding The OFCCP Behind The Scenes Aggressive Results-oriented: Good faith efforts alone are not sufficient 200 new compliance officers Large penalties for findings of discrimination Litigation-oriented oriented OFCCP Director Patricia Shiu is a former civil rights attorney for employees Focuses Compensation disparities Employment of veterans and individuals with disabilities Patricia Shiu, OFCCP Director 7

8 I RECEIVED AN AUDIT LETTER! NOW WHAT? 8

9 Responding To An Audit Letter Question: I just received an audit letter. What do I do first? Keep a record of the date of receipt. 30 days to submit the information time is of the essence! Question: I just received an audit letter and it was dated that it was sent 2 weeks ago! What do I do? Ensure this does not happen to you! Have a contact person for all key correspondence. Always have materials prepared in advance. If need more time, contact OFCCP and explain. Question: The audit letter lists 11 items I am supposed to provide, but I don t understand at all! What do I do? Seek legal advice. Generally, must provide. 9

10 UNDERSTANDING WHAT THE OFCCP LOOKS FOR 10

11 Current Scheduling Letter An organizational profile (must show for each unit: total number of males, females, minorities, and the job title, gender, race & ethnicity of the supervisor). The formation of job groups. For each job group, a statement of the percentage of minority and female incumbents. For each job group, a determination of minority and female availability. For each job group, the comparison of incumbency to availability. Placement goals for each job group in which the percentage of minorities or women employed is less than would be reasonably expected given their availability. 11

12 Current Scheduling Letter (cont.) EEO-1 reports for the last three years. Any collective bargaining agreements and other information already prepared that helps explain employee mobility systems, e.g., promotions. Affirmative action goals for the preceding AAP year and progress on your goals for the current AAP year (where applicable). Data on employment activity (applicants, hires, promotions, and terminations) for the preceding AAP year and current AAP year (if you are six months or more into current AAP year when you receive the letter). Compensation data by either salary range, rate, grade, or level showing total number of employees by race and gender and total compensation by race and gender. 12

13 Proposed Scheduling Letter New Item 8: Employment policies relating to the FMLA, pregnancy leave, and accommodations for religious observances. If these policies are part of the contractor s employee handbook, OFCCP requests that the contractor submit the entire handbook. Changes to current Item 10 (new Item 11): More specific demographic information on applicants, hires, promotions, and terminations Totals for each minority sub-group (rather than all minorities) Data by both job group and job title Changes to current Item 11 (new Item 12): More specific compensation data as it existed on February 1 of each year: All employees (FT, PT, K, Temp, Day, etc.) Gender and race/ethnicity information and hire date for each employee by job title AND job group Other compensation or adjustments to salary Any documentation related to compensation practices New Item 13: VETS-100 and/or VETS-100A for the last three years 13

14 Submitting Information Question: I collected everything in the scheduling letter. Should I just forward the information on? Do NOT submit data to the OFCCP without thorough review Correct all errors Clean applicant flow Reviewed job groups Run adverse impact reports for hires, promotions, terminations by AAP group for Minority v. Non-minority Individual Race Groups v. Whites Favored v. Non-favored Peform salary equity analysis AND be able to defend any salary disparities 14

15 ... you say my electronic submission carried a virus that destroyed all the hard drives at your office? RESPONDING TO FOLLOW-UP REQUESTS 15

16 Follow-up Requests Question: An OFCCP investigator just called a lower-level HR employee and asked some questions. I have no idea what the employee said and she could have said some incorrect things. What do I do? Ensure this does not happen to you. Designate a person of contact on your submission who will be able to answer questions. Be prepared to answer questions. If you do not know the answer, let the investigator know you will get back to them. Question: I have been asked to submit a great deal of followup documentation. Is this normal? And do I have to? Yes, but... the OFCCP will often work with you. Call the investigator to come to a mutually agreeable way to handle. 16

17 How Do I Handle On-site Visits? Question: Do I have to let the OFCCP come on-site? Question: Can I have an attorney/company representative present? Question: Can I prepare my supervisors and other employees beforehand? Question: How do I respond to questions? 17

18 WHAT DOES THE OFCCP DO WITH MY COMPENSATION DATA? 18

19 What Does Statistically Significant Mean? Coin tossing and probabilities Two standard deviations 5% Differences of two standard deviations or more are statistically significant Rare Outcome (Surprise!) Statistically Significant! 19

20 What Are The Odds? Standard Deviation Chance 3.2 in 10 5 in in 1,000 6 in 100,000 6 in 10 million 2 in 1 billion 20

21 What is Multiple Regression Analysis? Employees differ Multiple regression examines differences in average pay controlling for other factors Comparisons are within job groupings Control for differences in experience, etc. 21

22 OFCCP Compensation Audits Now 2% test and the smell test Almost all contractors asked to submit follow-up data Regression analysis by job title Individual compensation claims vs. systematic claims Disparity in handling of compensation audits by office 22

23 Prepare Now Review adverse impact by AAP, job title and grade Decide now how data will be submitted in desk audit and any extra factors that will be provided Review outliers and determine explanations Establish defensible pay practices Document pay decisions Investigate complaints promptly Train, train, train! 23

24 UNDERSTANDING NEGOTIATION OPPORTUNITIES 24

25 Can We Make A Deal? Question: The OFCCP just sent me a letter stating I owe big bucks! Can I negotiate? Yes... Liability (intentional discrimination) Shortfall/Pay Disparity Damages Correct pay (accurate overtime/benefits) Period of unemployment (i.e., less than two years) Wages and benefits at new employer (not minimum wage) 25

26 UNDERSTANDING THE OFCCP S POSITION ON CONFIDENTIALITY 26

27 Can We Keep This Confidential? Question: Can I keep all of this confidential? Question: Will the amount I paid be posted on the OFCCP s website? 27

28 ANTICIPATING FUTURE REQUIREMENTS OF THE OFCCP 28

29 What can we expect in the future? Proposed regulations for veterans Proposed regulations for individuals with disabilities Compensation collection tool 29

30 Questions? Shafeeqa Watkins Giarratani Teri Senior Danish Associate (713) (512)

31 AUSTIN BEIJING DALLAS DENVER DUBAI HONG KONG HOUSTON LONDON LOS ANGELES MINNEAPOLIS MUNICH NEW YORK PITTSBURGH-SOUTHPOINTE RIYADH SAN ANTONIO ST. LOUIS WASHINGTON, D.C FULBRIGHT [ ] 31