SURPRISE! You re a Federal Contractor. Shafeeqa Giarratani Fulbright & Jaworski, L.L.P.

Transcription

1 SURPRISE! You re a Federal Contractor What You Need To Know About Federal Contracting and Employment Law Shafeeqa Giarratani Fulbright & Jaworski, L.L.P. Shafeeqa Giarratani, Fulbright & Jaworski LLP

2 Heightened Focus on Federal Contractor Status Increasing number of federal contracts being awarded Great public pressure for accountability in use of federal funds Record increase in budget for government agencies enforcing federal contractor obligations Larger penalties

3 Agenda Who is a Federal Contractor? Key Obligations Enforcement Checklist for Management and Plaintiff Attorneys

4 Who enforces requirements for federal contractors? The OFCCP is an agency of the United States Department of Labor OFCCP = Office of Federal Contract Compliance Programs Enforces three key statutes Executive Order (women and minorities) Section 503 of the Rehabilitation Act (disabled) Vietnam Era Veterans Readjustment Assistance Act ( VEVRAA ) (veterans)

5 Who is a federal contractor?

6 What is a Government Contractor? Government Contract means Any agreement or modification thereof between any contracting agency and any person for the furnishing of supplies or services, or for the use of real or personal property, including lease arrangements. Services includes utility, construction, transportation, research, insurance, and fund depository, regardless of whether the Government is the purchaser or seller Contracts, not grants

7 Who is Covered? Non-discrimination requirements $10,000 in 12 months (EO and 503) $25,000 in 12 months (VEVRAA) Affirmative Action requirements At least 50 employees; and Either: One contract/subcontract for at least $50,000 in 12 months; or Government bills of lading of at least $50,000 in 12 months; or Depository for any federal funds; or Issuing and paying agent for any savings bonds or notes

8 Examples of Prime Government Contract Banks Universities (research) Oil company leasing government land for minerals Hospitals Technology companies Legal services (large law firms) Construction Food services Airlines Large courier services

9 What is a Subcontract? If necessary to performance of federal contract Overhead services or key components to prime federal contract Example: Railroad company that hauls coal for electricity company that supplies electricity to government Irrelevant whether contribution is large or small, significant or insignificant only must be traceable to satisfaction of federal contract If undertaking or assuming a portion of contractor s obligation to federal agency Examples: Property management of property leased to federal government Hospital which provides medical services for HMO that contracts with government Terms of prime federal contract are key

10 How does a company know whether they are a federal contractor? Sometimes they don t Receipt of a Scheduling Letter for Audit EEO Clause Should Be In Contract Keywords: Executive Order 11246, 41 CFR sections (a), (a) and (a) BUT is not always included or is missed

11 What is NOT Covered? The equal opportunity clause is not required for: Contracts of $10,000 or less Contracts in which the parties stand in the relationship of employer and employee Federally assisted construction contracts Contracts of indefinite quantities if purchaser reasonably believes aggregate <$10,000 Work outside the U.S. Contracts with state/local gov ts Contracts with religious entities Contracts with certain educational entities Work on or near Indian reservations Additional exceptions 41 CFR

12 Key Obligations

13 What Affirmative Action Is Proactive Steps To prevent discrimination To address stereotypical thinking and biases that still impede employment opportunity To ensure that females, minorities, individuals with disabilities, and veterans have equal opportunity in all aspects of employment

14 What Affirmative Action Is Not Making race-based decisions Title VII prohibits consideration of race in employment decisions Giving preferences to any group Most qualified is always hired, should not lower standards But pool should provide broad representation Establishing a quota system Goals are goals

15 What is required? Affirmative Action Plan for Each Establishment With goals and timetables Analysis of adverse impact for minorities and women Applicants v. hires Promotions v. incumbents Terminations v. incumbents Compensation

16 Disabled/Veterans AAP - Plan Text Policy statement Review of personnel processes Review of physical and mental qualification standards Reasonable accommodation to physical/mental limitations Harassment policy External dissemination of policy, outreach, and positive recruitment (including posting of positions) Internal dissemination of policy Audit and reporting system Responsibility for implementation Training

17 Female/Minority AAP - Contents 1. Organizational profile 2. Job group analysis 3. Placement of incumbents in job groups 4. Determining availability 5. Comparing incumbency to availability 6. Placement goals 7. Designation of responsibility for implementation 8. Identification of problem areas 9. Action-oriented programs 10. Periodic internal audits

18 Job Group Analysis Placement goals Step 1. Jobs are grouped Example Report Only AFFIRMATIVE ACTION PROGRAM 2012 Data as of: December 31, 2011 JOB GROUP TOTALS AND PERCENTAGES TOTAL MALE FEMALE TOTAL TOTAL TOTAL EES W B H A AI/NA TOM W B H A AI/NA TOM MALES FEMALES MIN % 2.4% 0.0% 31.7% 0.0% 0.0% 2.4% 4.9% 0.0% 53.7% 2.4% 0.0% 2.4% 36.6% 63.4% 92.7% MANAGERS & SUPERVISORS (1C) JOB TITLE JOB TOTAL MALE FEMALE TOTAL TOTAL TOTAL GROUP EES W B H A AI/NA TOM W B H A AI/NA TOM MALES FEMALES MIN. BO SUPERVISOR 1C BUSINESS MANAGER 1C CLINICAL SUPERVISOR I 1C CLINICAL SUPERVISOR II 1C LAB MED TECH SUPERVISOR 1C PATIENT ACCESS SUPERVISOR 1C PATIENT ACCOUNTS SUPERVISOR 1C RN/HOUSE SUPERVISOR 1C TRANSCRIPTION SUPERIVSOR 1C X-RAY SUPERVISOR 1C

19 Step 2: Review availability of candidates externally and internally Availability Analysis Example Report Only AFFIRMATIVE ACTION PROGRAM 2012 Data as of: December 31, 2011 MANAGERS & SUPERVISORS (1C) EXTERNAL FACTORS VALUE TOTAL TOTAL REASONABLE FEMALE Wgt. BLACK Wgt. HISPANIC Wgt. ASIAN Wgt. AI/NA Wgt. TOM Wgt. Wgt. CONSIDERED WEIGHT NUMBER MINORITI RECRUIT AREA ES Brownsville- 15.0% Harlingen % 56.7% 8.5% 0.0% 0.0% 68.8% 10.3% 0.1% 0.0% 0.0% 0.0% 0.4% 0.1% 69.3% 10.4% San Benito TX MSA Primary Recruitment Area Add'l Recruitment Area 10.0% 28,340 18,558 3,705 4, ,387 State of Texas 100.0% 65.5% 3.3% 13.1% 0.7% 16.4% 0.8% 1.7% 0.1% 0.4% 0.0% 1.5% 0.1% 33.1% 1.7% Med/Health Svs Mgrs INTERNAL Feeder Pools for Promotion Transfer or Training 25.0% Mgrs & Supervisors 15.9 Job Group (1C) 100.0% 63.4% % 0.0% 0.0% 85.4% 21.3% 2.4% 0.6% 0.0% 0.0% 4.9% 1.2% 92.7% 23.2% 25.0% Nursing 20.5 Professionals 100.0% 82.0% % 2.0% 0.5% 54.3% 13.6% 22.7% 5.7% 0.0% 0.0% 1.3% 0.3% 80.4% 20.1% Job Group (2B) 25.0% Admin Support 21.8 Job Group (5B) 100.0% 87.1% % 0.0% 0.0% 89.7% 22.4% 0.0% 0.0% 0.6% 0.2% 1.3% 0.3% 91.6% 22.9% Final Availability 100.0% 72.6% 1.4% 71.1% 6.9% 0.2% 2.0% 81.6% Final Availability Utilizatio n in this Job Group % 63.4% 0.0% 85.4% 2.4% 0.0% 4.9% 92.7% Utilization in this Job Group

20 Step 3: Compare availability to current workforce Comparison of Incumbency to Availability Utilization Analysis & Placement Goals Example Report Only AFFIRMATIVE ACTION PROGRAM 2012 Data as of: December 31, 2011 TOTAL EMPLOYEES TOTAL MINORITY / FEMALE INCUMBENTS 1, , # MINORITY / FEMALE INCUMBENTS FINAL AVAILABILITY GOALS JOB GROUP OF Black Hispanic Asian AI/NA TOM Minority Female Black Hispani c Asian AI/NA TOM Minority Female Black Hispani c Asian AI/NA TOM Minorit y Female EES % % % % % % % % % % % % % % OFFICIALS & SENIOR MGRS (1A & 1B) NO YES NO NO NO YES NO 0.0% 41.2% 0.0% 0.0% 5.9% 47.1% 73.5% 1.3% 59.1% 0.8% 0.0% 5.1% 66.4% 66.5% 59.1% 66.4% MANAGERS & SUPERVISORS (1C) NO NO YES NO NO NO NO 0.0% 85.4% 2.4% 0.0% 4.9% 92.7% 63.4% 1.4% 71.1% 6.9% 0.2% 2.0% 81.6% 72.6% 6.9% NURSING PROFESSIONALS (2B) NO NO NO NO NO NO NO 2.0% 54.3% 22.7% 0.0% 1.3% 80.4% 82.0% 1.3% 63.4% 11.6% 0.1% 0.9% 77.3% 81.6% SENIOR SERVICE WORKERS (9A) NO NO NO NO NO NO YES 0.0% 86.1% 5.6% 0.0% 0.0% 91.7% 58.3% 0.3% 91.4% 2.0% 0.0% 0.3% 94.0% 81.6% 81.6% MID/ENTRY SERVICE WKRS (9B & 9C) NO NO NO NO NO NO NO 0.0% 92.7% 2.6% 0.0% 0.0% 95.4% 72.8% 0.2% 93.9% 0.4% 0.1% 0.4% 94.9% 84.4%

21 Additional Obligations EEO clause in subcontracts (can incorporate by reference) Record retention of any employment records Two years from making or action One year if < 150 employees or contract < $150,000 Current and preceding AAP EEO/disability/veteran poster Executive Order EEO-1 Advertising language ( EEO Employer) Invitation to self-identify

22 Additional Obligations Notice of location/hours for review Post job openings, unless Executive and top management position To be filled exclusively from internal sources Lasting 3 days or fewer

23 How is this enforced?

24 Enforcement OFCCP conducts random audits Desk Audit Phase Submission Requirements Follow Up Requests On Site Audit Review of Records Interview Managers and Employees Notice of Violation and Conciliation Lawsuit 24

25 Consequences of Non-Compliance Back pay (2 years) for each individual + benefits + interest Hiring Training Non-negotiable press release Two year follow-up period Companywide debarment from federal contracts 25

26 Review of Recent Press Releases Federal Express $3,200,000 Vought Aircraft Industries... $1,500,000 Gerber Products $900,000 26

27 Checklist for Management and Plaintiff Attorneys

28 Management Attorneys Determine whether client is current a federal contractor EEO-1, Question C(3) Review current contracts for EEO language Advise clients to carefully enter federal contracts Advise to annually prepare affirmative action plan Ensure companies are conducting adverse impact analysis under privilege, where possible In discrimination litigation, ask clients to review affirmative action plan and review placement goals and any adverse impact Determine whether client has had any recent conciliation agreements

29 Plaintiff Attorneys Ask whether company is a federal contractor in discovery or check the internet Ask for the affirmative action plan Should have past two years at least Employee right to review Review Job groups = similarly situated Placement goals Adverse impact for promotions, terminations, hiring, compensation Identification of problem areas and follow-up Relevance to individual claims? Disparate impact?

30 Shafeeqa Giarratani 98 San Jacinto Blvd, Suite 1100 Austin, Texas When You Think Government Contracts, Think Fulbright. TM AUSTIN BEIJING DALLAS DENVER DUBAI HONG KONG HOUSTON LONDON LOS ANGELES MINNEAPOLIS MUNICH NEW YORK RIYADH SAN ANTONIO ST. LOUIS WASHINGTON, D.C FULBRIGHT [ ]