Constructing and Using Diversity Metrics: Basic and Beyond
Speaker: Valerie Hoffman, Founder and Chair, Seyfarth Shaw LLP’s Affirmative Action and Diversity Practice
The pre-conference workshop presented by Valerie Hoffman at the NILG focused on the basics of diversity metrics and some practical applications for developing basic and advanced diversity metrics. Some key differences were noted between diversity and affirmative action. Affirmative action is mandated by law and includes actions taken to ensure nondiscrimination of females, minorities, veterans, and individuals with disabilities. Diversity is not mandated by law and embraces each trait that makes us unique. The primary dimensions of diversity that are most easily measurable include: age, gender, race, mental/physical abilities & characteristics, ethnic heritage, and sexual orientation. It is important to choose efforts and characteristics to measure thoughtfully. Without a background and diversity in context, gathering certain demographics may create a negative view of the diversity initiative. Setting the stage to be proud of diversity as opposed to counting numbers for preferences is an important distinction to make. Some basic quantitative measurements can include the following analyses: workforce demographics (race, ethnicity, gender), quarterly progress reports, year-over-year trends, by business unit and department, and by job level. More complex levels of analyses can be conducted and include some of the following variables: performance ratings, employee compensation, training opportunities, high potential list composition, sexual orientation, movement, affinity group participation, generational studies, etc. In order to establish a process for progress, it is important to practice inclusion and not preferences. Many of these basic reports can be easily constructed with the proper documentation. Please feel free to contact BCG for some more information on you can create diversity metrics within your organization.
Tuesday, December 23, 2008
Self Identification Requirements for Applicants with Disabilities
Self Identification Requirements for Applicants with Disabilities
and/or Veterans
By: Marife Ramos, Sr. Consultant Biddle Consulting Group
The release of the long-awaited “Internet Applicant” definition that went into effect on February 6, 2006 (formally titled “41 CFR Part 60–1 Obligation To Solicit Race and Gender Data for Agency Enforcement Purposes; Final Rule”) also gave rise to new recordkeeping requirements (41 CFR 60-1.12). As part of the recent update to the rule, contractors are required to solicit the gender and race information from all applicants. However, it does not specify the stage in the selection process when an invitation to self-identify must be extended to applicants. Since contractors are required to show good faith efforts in the solicitation of gender and race information from their applicants, it makes good business sense for contractors to extend an invitation to self-identify at the very first stage of the application process. Also, the employer could instead choose to solicit gender and race information in one or more of the succeeding stages of the selection process so long as the selection of race and gender is not required and can, in fact, be declined.
It is a different story however, when it comes to the solicitation of disability and/or veteran status of an applicant. The employer has a very small window of opportunity to solicit this information. The applicants’ disability and/or veteran status may not be solicited by contractors before a job offer is made. Invitations for self- identifications can only be made by contractors at the post-offer stage but before the applicant becomes an employee (i.e., on the payroll) (41 CFR 60-250.42).
What does this mean to contractors? It means that “in general,” contractors may not solicit disability and/or veteran status from their applicants in the same manner as the employers request for identification of race and gender. Self-identification invitations should only be made after a job offer is made but also NOT after the applicant becomes an employee.
In order to better address the self-identification requirements; contractors should consider developing two (2) self-identification forms for their applicants:
1) to solicit gender and race for applicants in general; and
2) to solicit disability and veteran status after a job offer is made but before official employment occurs (race and gender information can again be solicited at this stage).
It would also be a good idea to establish a well-defined system that will consistently remind those with recruitment and hiring responsibilities to provide a self-id form (which should include a solicitation of veteran/disability status) to an applicant who was offered a job but before such applicant becomes officially an employee. For example, include the self-id form with the employment packet that the prospective employee needs to complete before starting work (e.g., I-9, W-4, etc.).
and/or Veterans
By: Marife Ramos, Sr. Consultant Biddle Consulting Group
The release of the long-awaited “Internet Applicant” definition that went into effect on February 6, 2006 (formally titled “41 CFR Part 60–1 Obligation To Solicit Race and Gender Data for Agency Enforcement Purposes; Final Rule”) also gave rise to new recordkeeping requirements (41 CFR 60-1.12). As part of the recent update to the rule, contractors are required to solicit the gender and race information from all applicants. However, it does not specify the stage in the selection process when an invitation to self-identify must be extended to applicants. Since contractors are required to show good faith efforts in the solicitation of gender and race information from their applicants, it makes good business sense for contractors to extend an invitation to self-identify at the very first stage of the application process. Also, the employer could instead choose to solicit gender and race information in one or more of the succeeding stages of the selection process so long as the selection of race and gender is not required and can, in fact, be declined.
It is a different story however, when it comes to the solicitation of disability and/or veteran status of an applicant. The employer has a very small window of opportunity to solicit this information. The applicants’ disability and/or veteran status may not be solicited by contractors before a job offer is made. Invitations for self- identifications can only be made by contractors at the post-offer stage but before the applicant becomes an employee (i.e., on the payroll) (41 CFR 60-250.42).
What does this mean to contractors? It means that “in general,” contractors may not solicit disability and/or veteran status from their applicants in the same manner as the employers request for identification of race and gender. Self-identification invitations should only be made after a job offer is made but also NOT after the applicant becomes an employee.
In order to better address the self-identification requirements; contractors should consider developing two (2) self-identification forms for their applicants:
1) to solicit gender and race for applicants in general; and
2) to solicit disability and veteran status after a job offer is made but before official employment occurs (race and gender information can again be solicited at this stage).
It would also be a good idea to establish a well-defined system that will consistently remind those with recruitment and hiring responsibilities to provide a self-id form (which should include a solicitation of veteran/disability status) to an applicant who was offered a job but before such applicant becomes officially an employee. For example, include the self-id form with the employment packet that the prospective employee needs to complete before starting work (e.g., I-9, W-4, etc.).
NILG Conference - OFCCP: An Overview of Statistical Applications
OFCCP: An Overview of Statistical Applications
Speaker: Dr. Javaid Kaiser, Director of Statistical Analysis, OFCCP
In this session, Dr. Kaiser introduced himself as the new head statistician for OFCCP. As the head of the department his focus in the presentation was to discuss how he wanted to shape the OFCCP and what he felt were the key things that Federal contractors should be focusing on when it comes to conducting statistical analyses. He began with a few statistical procedures that would benefit the contractor community for self-evaluation of employment data, then he went into changes that are happening at the OFCCP and he closed with audit tips.
There is a new name for the statistical analysis division at the OFCCP – the Division of Statistics and Technology (DST). The DST has adopted a new directive that all audit-related statistical work must reviewed by the heads of the division before a Notice of Violation can be issued. The reason for this is to ensure that the analyses are conducted correctly.
The statistical analyses that the DST uses during selection reviews (and those that contractors are urged to use) are the binomial test for large sample sizes, Fisher’s Exact for small sample sizes, Logistic regression, Mantel-Haenzel, and the Breslow-Day tests. Dr. Kaiser mentioned that Logistic Regression, Mantel-Haenzel and Breslow-Day tests are more complicated than the other statistical analyses and should be conducted by statistical experts.
Listed below are some current challenges that the OFCCP faces when conducting compliance reviews:
Submittal of incomplete data.
Developing SSEGs is a difficult process – the OFCCP might change the process.
It’s difficult analyzing data that has small sample sizes. OFCCP’s solution is to use non-parametric tests.
Handling pay grade, department, location, shift, etc. differences when analyzing certain groupings.
Some suggestions that Dr. Kaiser gave regarding data submittal during a compliance evaluation are:
· Clearly label all 12 factors for the compensation data request and explain why any are missing.
· Compensation data should be the same as the snapshot data for the plan.
· Disclose any bargaining union agreements
Dr. Kaiser finished the session discussing DST’s plans for improvement in the following areas in order to decrease the time spent on reviews:
Development of the SSEGs.
Review the triggers for compensation.
Data verification protocol.
Explore parametric statistics.
Standardize operating procedures throughout all OFCCP offices.
Uniform business rules nationwide.
Automate business process.
Speaker: Dr. Javaid Kaiser, Director of Statistical Analysis, OFCCP
In this session, Dr. Kaiser introduced himself as the new head statistician for OFCCP. As the head of the department his focus in the presentation was to discuss how he wanted to shape the OFCCP and what he felt were the key things that Federal contractors should be focusing on when it comes to conducting statistical analyses. He began with a few statistical procedures that would benefit the contractor community for self-evaluation of employment data, then he went into changes that are happening at the OFCCP and he closed with audit tips.
There is a new name for the statistical analysis division at the OFCCP – the Division of Statistics and Technology (DST). The DST has adopted a new directive that all audit-related statistical work must reviewed by the heads of the division before a Notice of Violation can be issued. The reason for this is to ensure that the analyses are conducted correctly.
The statistical analyses that the DST uses during selection reviews (and those that contractors are urged to use) are the binomial test for large sample sizes, Fisher’s Exact for small sample sizes, Logistic regression, Mantel-Haenzel, and the Breslow-Day tests. Dr. Kaiser mentioned that Logistic Regression, Mantel-Haenzel and Breslow-Day tests are more complicated than the other statistical analyses and should be conducted by statistical experts.
Listed below are some current challenges that the OFCCP faces when conducting compliance reviews:
Submittal of incomplete data.
Developing SSEGs is a difficult process – the OFCCP might change the process.
It’s difficult analyzing data that has small sample sizes. OFCCP’s solution is to use non-parametric tests.
Handling pay grade, department, location, shift, etc. differences when analyzing certain groupings.
Some suggestions that Dr. Kaiser gave regarding data submittal during a compliance evaluation are:
· Clearly label all 12 factors for the compensation data request and explain why any are missing.
· Compensation data should be the same as the snapshot data for the plan.
· Disclose any bargaining union agreements
Dr. Kaiser finished the session discussing DST’s plans for improvement in the following areas in order to decrease the time spent on reviews:
Development of the SSEGs.
Review the triggers for compensation.
Data verification protocol.
Explore parametric statistics.
Standardize operating procedures throughout all OFCCP offices.
Uniform business rules nationwide.
Automate business process.
OFCCP Directive - The G-FIVE Initiative
The Good Faith Initiative for Veterans Employment (G-FIVE Initiative)
The OFCCP has announced the creation of a program targeted at encouraging the employment if military veterans by formally recognizing federal contractors and subcontractors that are making good faith efforts to employ covered veterans. The program named, “Good-Faith Initiative for Veterans Employment” or “G-FIVE Initiative” provides a 3 year exemption for contractors or subcontractors who receive a G-FIVE rating.
Based on the new G-FIVE initiative, OFCCP’s regional offices may recommend to its national headquarters office a G-FIVE rating for those contractors and subcontractors that have “demonstrated outstanding achievements in the employment of covered veterans.”
OFCCP will consider the following factors when evaluating contractors and subcontractors for a G-FIVE rating:
- Evidence of covered veterans in the contractor’s workforce
- Evidence of an increase in the number of covered veterans in the contractors workforce
- The number of partnerships with local veterans organizations
- An established partnership with the state or local workforce agencies
- Recruitment efforts at educational institutions to reach students who are covered veterans.
- The number of job advertisements targeting veterans posted within the community.
- For contractors, evidence that demonstrates a commitment to encourage their subcontractors to seek qualified covered veterans for employment opportunities.
- Affirmative action steps taken to attract special disabled or disabled veterans through the nearest Veterans Administration job placement program.
- The number of on the job training opportunities provided to covered veterans
Contractors and subcontractors are not required to complete all of these activities in order to be considered. It is important to note that the G-FIVE rating and recognition is by establishment and does not apply to the company as a whole.
There are two ways in which a contractor can be considered:
1. OFCCP regional directors can make G-FIVE recommendations to the national headquarters, following compliance reviews of those contractors and subcontractors.
2. Contractors and subcontractors can self-nominate by submitting to the appropriate regional directors a written statement expressing its interest in being considered for the G-FIVE rating. If contractors have not undergone a full compliance review within the last 24 months, the OFCCP will conduct a compliance review at the time of self-nomination.
Contractors who do receive a G-FIVE rating will be recognized on OFCCP’s website and will receive certificates of recognition.
The OFCCP has announced the creation of a program targeted at encouraging the employment if military veterans by formally recognizing federal contractors and subcontractors that are making good faith efforts to employ covered veterans. The program named, “Good-Faith Initiative for Veterans Employment” or “G-FIVE Initiative” provides a 3 year exemption for contractors or subcontractors who receive a G-FIVE rating.
Based on the new G-FIVE initiative, OFCCP’s regional offices may recommend to its national headquarters office a G-FIVE rating for those contractors and subcontractors that have “demonstrated outstanding achievements in the employment of covered veterans.”
OFCCP will consider the following factors when evaluating contractors and subcontractors for a G-FIVE rating:
- Evidence of covered veterans in the contractor’s workforce
- Evidence of an increase in the number of covered veterans in the contractors workforce
- The number of partnerships with local veterans organizations
- An established partnership with the state or local workforce agencies
- Recruitment efforts at educational institutions to reach students who are covered veterans.
- The number of job advertisements targeting veterans posted within the community.
- For contractors, evidence that demonstrates a commitment to encourage their subcontractors to seek qualified covered veterans for employment opportunities.
- Affirmative action steps taken to attract special disabled or disabled veterans through the nearest Veterans Administration job placement program.
- The number of on the job training opportunities provided to covered veterans
Contractors and subcontractors are not required to complete all of these activities in order to be considered. It is important to note that the G-FIVE rating and recognition is by establishment and does not apply to the company as a whole.
There are two ways in which a contractor can be considered:
1. OFCCP regional directors can make G-FIVE recommendations to the national headquarters, following compliance reviews of those contractors and subcontractors.
2. Contractors and subcontractors can self-nominate by submitting to the appropriate regional directors a written statement expressing its interest in being considered for the G-FIVE rating. If contractors have not undergone a full compliance review within the last 24 months, the OFCCP will conduct a compliance review at the time of self-nomination.
Contractors who do receive a G-FIVE rating will be recognized on OFCCP’s website and will receive certificates of recognition.
OFCCP Directive - Recordkeeping
Electronic Recordkeeping
In light of the transition to solely electronic recordkeeping systems, the OFCCP published a new directive regarding electronic recordkeeping in May of 2008. The timeframe required for keeping files and the correct way to convert and store files were reviewed during the OFCCP’s Homestretch webinar conducted on September 10th, 2008.
The record retention periods according to Executive Order 11246 are as follows: If you are a contractor with 150 or fewer employees, or do not have a contract of at least $150,000, the record retention period is a minimum of one year. Any contractors that employ over 150 employees or have a contract greater than $150,000, must keep their records for a minimum of two years. These regulations have not changed and are not new.
All paper records can be converted to an electronic format if the medium used accurately reproduces the paper original and would constitute a duplicate or substitute copy of the original paper record under Federal law. The records also need to be accurate and must be able to be converted back into a legible and readable paper copy available to be provided, should the OFCCP request them.
Original paper records may be disposed of following the complete transfer to the electronic format, only if the electronic file accurately reproduces the original paper records. Contractors that use the electronic system must keep their files accurate, accessible, and complete for the minimum record retention timeframe.
In light of the transition to solely electronic recordkeeping systems, the OFCCP published a new directive regarding electronic recordkeeping in May of 2008. The timeframe required for keeping files and the correct way to convert and store files were reviewed during the OFCCP’s Homestretch webinar conducted on September 10th, 2008.
The record retention periods according to Executive Order 11246 are as follows: If you are a contractor with 150 or fewer employees, or do not have a contract of at least $150,000, the record retention period is a minimum of one year. Any contractors that employ over 150 employees or have a contract greater than $150,000, must keep their records for a minimum of two years. These regulations have not changed and are not new.
All paper records can be converted to an electronic format if the medium used accurately reproduces the paper original and would constitute a duplicate or substitute copy of the original paper record under Federal law. The records also need to be accurate and must be able to be converted back into a legible and readable paper copy available to be provided, should the OFCCP request them.
Original paper records may be disposed of following the complete transfer to the electronic format, only if the electronic file accurately reproduces the original paper records. Contractors that use the electronic system must keep their files accurate, accessible, and complete for the minimum record retention timeframe.
OFCCP Directive - Online Application Systems
Online Application Systems
One of the topics that was discussed during the OFCCP’s September 10, 2008 webinar (OFCCP: The Homestretch) is the Directive on the use Online Application Systems by contractors. The topic was presented by Ms. Naomi Levin, Acting Branch Chief, Policy Development and Procedures.
The emergence of advance technologies has also prompted most employers to use Online Application System (OAS) as a tool in their application process (either exclusively or in combination with the traditional paper application). Therefore, it became necessary for compliance monitoring agencies, such as the OFCCP, to ensure that these OAS are accessible to ALL interested individuals, including to persons with disabilities.
OFCCP’s Online Application Systems Directive mainly focuses on the accessibility of these OAS to persons with disabilities. It provides guidance to contractors’ Affirmative Action obligations under Section 503 of the Rehabilitation Act of 1973, as amended (Section 503), the Vietnam Era Veterans' Readjustment Act of 1974, as amended, 38 U.S.C. 4212 (VEVRAA), and Title I of Americans with Disabilities Act of 1990, as amended (ADA). The directive provides that:
During compliance evaluations, the OFCCP will also include a review of the contractor’s online application system. The review will ensure that equal opportunity is provided to disabled persons. It will also include a review of whether the contractor provided reasonable accommodations to persons with disabilities, unless such accommodations will cause undue hardship to the employer (e.g., too costly).
Individual complaints that involve the contractor’s OAS can also be investigated and reviewed by the OFCCP.
The OFCCP also offered some recommended actions in order to ensure equal opportunities are extended to persons with disabilities:
A notice on how to obtain reasonable accommodations should be clearly displayed on the contractor’s OAS. The notice should contain:
the contact information (e.g., name/title or the person, phone, number, e-mail address, location address, etc.)
a clearly stated process in obtaining reasonable accommodations
The OAS should be able to operate with adaptive technologies used by persons with disabilities (e.g., voice recognition)
Provide an alternate way to apply for a job besides the OAS (e.g., filling out paper application forms)
Kiosks should be accessible to persons with mobility impairments
The notice on how to obtain reasonable accommodation is also recommended to be placed on the very first screen of the of the online application system.
To learn more about this new directive, you may visit www.dol.gov/esa/ofccp
One of the topics that was discussed during the OFCCP’s September 10, 2008 webinar (OFCCP: The Homestretch) is the Directive on the use Online Application Systems by contractors. The topic was presented by Ms. Naomi Levin, Acting Branch Chief, Policy Development and Procedures.
The emergence of advance technologies has also prompted most employers to use Online Application System (OAS) as a tool in their application process (either exclusively or in combination with the traditional paper application). Therefore, it became necessary for compliance monitoring agencies, such as the OFCCP, to ensure that these OAS are accessible to ALL interested individuals, including to persons with disabilities.
OFCCP’s Online Application Systems Directive mainly focuses on the accessibility of these OAS to persons with disabilities. It provides guidance to contractors’ Affirmative Action obligations under Section 503 of the Rehabilitation Act of 1973, as amended (Section 503), the Vietnam Era Veterans' Readjustment Act of 1974, as amended, 38 U.S.C. 4212 (VEVRAA), and Title I of Americans with Disabilities Act of 1990, as amended (ADA). The directive provides that:
During compliance evaluations, the OFCCP will also include a review of the contractor’s online application system. The review will ensure that equal opportunity is provided to disabled persons. It will also include a review of whether the contractor provided reasonable accommodations to persons with disabilities, unless such accommodations will cause undue hardship to the employer (e.g., too costly).
Individual complaints that involve the contractor’s OAS can also be investigated and reviewed by the OFCCP.
The OFCCP also offered some recommended actions in order to ensure equal opportunities are extended to persons with disabilities:
A notice on how to obtain reasonable accommodations should be clearly displayed on the contractor’s OAS. The notice should contain:
the contact information (e.g., name/title or the person, phone, number, e-mail address, location address, etc.)
a clearly stated process in obtaining reasonable accommodations
The OAS should be able to operate with adaptive technologies used by persons with disabilities (e.g., voice recognition)
Provide an alternate way to apply for a job besides the OAS (e.g., filling out paper application forms)
Kiosks should be accessible to persons with mobility impairments
The notice on how to obtain reasonable accommodation is also recommended to be placed on the very first screen of the of the online application system.
To learn more about this new directive, you may visit www.dol.gov/esa/ofccp
OFCCP: 2008 Homestretch Presentation - Audits
OFCCP: 2008 Homestretch - Audits
The OFCCP recently conducted a webinar to discuss significant accomplishments within the last fiscal year and future initiatives for fiscal year 2009. Among the initiatives for 2009, the OFCCP discussed future compliance evaluations.
Contractors should prepare for an audit storm to hit. Beginning in the first week of October 2008 the OFCCP will send out Corporate Scheduling Announcement Letters (CSAL) to organizations with two or more establishments on the potential list for compliance evaluation. Following the CSAL, during the second week of October 2008 the OFCCP will be sending 2,500 scheduling letters (for Compliance Evaluation). Another batch of 5,000 scheduling letters is scheduled to be release in March 2009.
If 7,500 potential audits in 2009 are not enough, the OFCCP announced a new initiative in which one in fifty audits will be scheduled for an automatic on-site review. The OFCCP announced they will randomly choose establishments for on-site review.
Keep in mind not all contractors will receive a CSAL and establishments not on a CSAL can still be audited.
The OFCCP discussed a few other important notes listed below:
· The OFCCP will continue their focus on systemic discrimination.
· The OFCCP is continuing to streamline their procedure to allow them to maximize resources.
· A majority of compliance evaluations are closed after the desk audit.
· The OFCCP will incorporate quality audit standards to ensure compliance and responsibility to VEVRAA and 503.
With the forthcoming storm of audits and new directives, contractors need to be prepared. Make sure you have an Affirmative Action Plan in place before receiving a 30 day scheduling letter. This will allow maximum time to prepare for audit submittal. Also, make sure you are up-to-date and compliant with all EEO/AA regulations and requirements. This includes Veteran requirements. While this has not typically been an OFCCP focus it sounds as though that may change. If you are not familiar with EEO/AA regulations and requirements please contact an expert, like Biddle Consulting Group, to help you prepare.
The OFCCP recently conducted a webinar to discuss significant accomplishments within the last fiscal year and future initiatives for fiscal year 2009. Among the initiatives for 2009, the OFCCP discussed future compliance evaluations.
Contractors should prepare for an audit storm to hit. Beginning in the first week of October 2008 the OFCCP will send out Corporate Scheduling Announcement Letters (CSAL) to organizations with two or more establishments on the potential list for compliance evaluation. Following the CSAL, during the second week of October 2008 the OFCCP will be sending 2,500 scheduling letters (for Compliance Evaluation). Another batch of 5,000 scheduling letters is scheduled to be release in March 2009.
If 7,500 potential audits in 2009 are not enough, the OFCCP announced a new initiative in which one in fifty audits will be scheduled for an automatic on-site review. The OFCCP announced they will randomly choose establishments for on-site review.
Keep in mind not all contractors will receive a CSAL and establishments not on a CSAL can still be audited.
The OFCCP discussed a few other important notes listed below:
· The OFCCP will continue their focus on systemic discrimination.
· The OFCCP is continuing to streamline their procedure to allow them to maximize resources.
· A majority of compliance evaluations are closed after the desk audit.
· The OFCCP will incorporate quality audit standards to ensure compliance and responsibility to VEVRAA and 503.
With the forthcoming storm of audits and new directives, contractors need to be prepared. Make sure you have an Affirmative Action Plan in place before receiving a 30 day scheduling letter. This will allow maximum time to prepare for audit submittal. Also, make sure you are up-to-date and compliant with all EEO/AA regulations and requirements. This includes Veteran requirements. While this has not typically been an OFCCP focus it sounds as though that may change. If you are not familiar with EEO/AA regulations and requirements please contact an expert, like Biddle Consulting Group, to help you prepare.
Understanding Defenses from the Perspective of the OFCCP
Biddle Consulting offers newsletters on many important EEO topics at our webiste www.biddle.com . We recently provided several articles about the presentations given at the National ILG meeting. Enclosed is a summary of the OFCCP presentation on what forms of excuses and defenses that they will not accept during the audit process.
Presenter: Sandra Scott Ziegler
Attorney
Midwest Region OFCCP
Sandra Scott Ziegler is veteran officer of the OFCCP out of the Midwest Region. Sandra and her team provided one of the most unique and energetic NILG presentations that we have ever seen. Sandra ran a Powerpoint slide show that had music and animation that kept the audience in stitches for well over an hour. The purpose of the presentation was to inform contractors about all of the excuses and shortcomings that they see from Federal contractors that will not be considered acceptable by OFCCP in an audit. This presentation is significant because OFCCP tends to be coy about how they operate behind the scenes so when they come to a conference and provide a list of activities and excuses that they consider red-flags, BCG will make a point to pass the message along to our clients and make sure they pay attention.
The slideshow was broken out by a series of headers that acted as main bullets that fell under the headline of “Don’t Go There.”
Purpose
To identify often used defenses that will not work in OFCCP audits.
OFCCP’s opinion is that clarifying these common excuses will help contractors save time and money as well as enhance voluntary compliance.
The main points:
The Good Faith Defense
· Contractor misconception: “When utilization exceeds availability there is no discrimination” This is totally false. There can be potential discrimination in transactions such as hiring, promotions and terminations even if a job group has an incumbent percentage higher than what is available.
· OFCCP handed out a copy of the TNT case (Tyson Foods) where OFCCP won a case where the Tyson Foods defense team tried, unsuccessfully to show they were not discriminating.
o OFCCP proved discrimination against Hispanics
o The Courts said that a balanced workforce does not provide a get out free card for discrimination
o Courts prefer actual applicant flow rather then workforce statistics because those were the available individuals who had interest in the job. (this serves as a reminder why contractors need to collect proper applicant data)
o Intent does not mean a company is inherently evil. Companies could be deceived by thinking that they already achieved a goal for a certain group so their focus was placed somewhere else resulting in unintentional discrimination
Self Validating Test Defense
· Another contractor misconception: “Collective common sense says a test is valid for a job.”
· OFCCP response: “tests DO NOT self validate”
· Tests must be: Tailored to the job, follow Uniform Guidelines on Employee Selection Procedures (UGESP) and accurate
· Are less discriminatory tests available that would meet the contractor’s needs? (Usually there is in increase in Adverse Impact against a group in tests that have specific requirements for lifting, language, etc.)
· Any test should be validated to test for AI à Uniform Guidelines (UG) says with 80% rule but other regulations say also SD.
· In the TNT case – The contractor only asked Spanish speaking applicants if they spoke good English. This was considered an informal test not uniformly applied.
· Audience question: If creating a question on an application that asks if the applicant can lift 30 lbs (check box), is this a test? Yes, it’s a selection procedure and it needs to be validated
Refusal to Submit the 12 Item Compensation Data
o In the Bank of America case: they refused to submit the 12 item data. They said if the OFCCP is asking for it they must have reasonable suspicion. OFCCP response: No reasonable suspicion is necessary and there are no 4th amendment issues associated with the request.
o The purpose of a desk audit is to determine if there is a problem. See 60-1.43 and 1.4(a) for the regulation citation.
o In the Ledbetter case: Authority to gather information (compensation) was questioned. The OFCCP will gather all factors that influence compensation
§ Time frame occurrence having to do with a statute of limitations
o The purpose of the desk audit is to determine if there is reason to believe there is a violation
“I’m not on the scheduling list”
o Contractors often try to get out of an audit by stating they should not have been selected for an audit.
o Periodic reviews go beyond the FCSS list which is used for regular desk audits. There are also CMCE: corporate management compliance evaluations, FAAP: functional AAP audits, and DAS: directive review as well as other selection criteria not provided by OFCCP.
Contractor misconception: “We don’t have two (2) standard deviations to infer Adverse Impact or discrimination.”
o The courts have held that two or more standard deviations permit an inference of discrimination.
o Two standard deviations is NOT a threshold that must be met in order to continue an investigation
o Examples of reasons OFCCP will dig deeper:
o 0% Female and Minority in an areas you’d expect availability
o Tip to OFCCP about something potentially offensive
o Number of applicants = Number of hires (1:1 ratio)
o Quality check
o Any number of things could lead to further investigation
o There are no standards that says they cannot investigate further if desired
Correcting to have a result that shows less then two (2) standard deviations
o Another contractor misconception: Contractors argue that OFCCP cannot make the contractor eliminate the entire disparity as opposed to getting the result within two standard deviations.
o OFCCP: No, if results are discriminatory then shortfall should eliminate ALL disparity
o Favored group for comparison is not always male and white. OFCCP can go after selection disparities against all races and genders. (BCG note, we have seen OFCCP pursue Adverse Impact against whites and men in recent audits)
Statistics alone are not enough
o A pattern or practice case can be built on statistics alone. An increase in statistical disparity is more compelling to OFCCP
o If a contractor does not rebut a prima facie case of intentional discrimination then the courts can infer discrimination based on statistics
o OFCCP will seek anecdotal evidence where possible. Contractors should provide anecdotal evidence if available
o Comparisons of selected v. non-selected
§ Applied v. Offered
Statistical vs. Practical Significance (PS)
o Contractors argue that Practical Significance can imply that a contractors’ Adverse Impact analysis is not significant if a change in two hires brings the result to less than two standard deviations.
o OFCCP (Q&A #21 in UG): UGESP states that only switching one is allowed and it would have to bring the selection rate within 80%
o OFCCP PS:
§ Change 1-2 from fail to pass
§ Not an 80% violation
§ Not greater then 2 SD
The TNT Case – OFCCP argued that applicant pool was not atypical compared to competitors
o Would have to show the specialized recruitment drew unqualified individuals for the position
o Inflated race/gender
o The OFCCP can use competitor’s applicant pools as a comparison
“The data submitted for the audit is an aberration”
o Contractors attempting to argue to OFCCP that their audit issues should be attributed to: “You picked a bad year.”
o “My data is so bad it’s not worth analyzing” – Inadequate data does not reduce liability (BCG note – in fact we would expect it to dramatically increase the OFCCPs scrutiny of your organization)
o OFCCP can select the time period for review
o The OFCCP becomes suspicious of what has been done after the scheduling letter has been received.
Other defenses that will also receive scrutiny
o Lopsided refinements (look at both sides, i.e. men and women)
o Tolling liability because of case processing
o Mitigate at a higher pay rate
o Inadequate data reduces liability
Presenter: Sandra Scott Ziegler
Attorney
Midwest Region OFCCP
Sandra Scott Ziegler is veteran officer of the OFCCP out of the Midwest Region. Sandra and her team provided one of the most unique and energetic NILG presentations that we have ever seen. Sandra ran a Powerpoint slide show that had music and animation that kept the audience in stitches for well over an hour. The purpose of the presentation was to inform contractors about all of the excuses and shortcomings that they see from Federal contractors that will not be considered acceptable by OFCCP in an audit. This presentation is significant because OFCCP tends to be coy about how they operate behind the scenes so when they come to a conference and provide a list of activities and excuses that they consider red-flags, BCG will make a point to pass the message along to our clients and make sure they pay attention.
The slideshow was broken out by a series of headers that acted as main bullets that fell under the headline of “Don’t Go There.”
Purpose
To identify often used defenses that will not work in OFCCP audits.
OFCCP’s opinion is that clarifying these common excuses will help contractors save time and money as well as enhance voluntary compliance.
The main points:
The Good Faith Defense
· Contractor misconception: “When utilization exceeds availability there is no discrimination” This is totally false. There can be potential discrimination in transactions such as hiring, promotions and terminations even if a job group has an incumbent percentage higher than what is available.
· OFCCP handed out a copy of the TNT case (Tyson Foods) where OFCCP won a case where the Tyson Foods defense team tried, unsuccessfully to show they were not discriminating.
o OFCCP proved discrimination against Hispanics
o The Courts said that a balanced workforce does not provide a get out free card for discrimination
o Courts prefer actual applicant flow rather then workforce statistics because those were the available individuals who had interest in the job. (this serves as a reminder why contractors need to collect proper applicant data)
o Intent does not mean a company is inherently evil. Companies could be deceived by thinking that they already achieved a goal for a certain group so their focus was placed somewhere else resulting in unintentional discrimination
Self Validating Test Defense
· Another contractor misconception: “Collective common sense says a test is valid for a job.”
· OFCCP response: “tests DO NOT self validate”
· Tests must be: Tailored to the job, follow Uniform Guidelines on Employee Selection Procedures (UGESP) and accurate
· Are less discriminatory tests available that would meet the contractor’s needs? (Usually there is in increase in Adverse Impact against a group in tests that have specific requirements for lifting, language, etc.)
· Any test should be validated to test for AI à Uniform Guidelines (UG) says with 80% rule but other regulations say also SD.
· In the TNT case – The contractor only asked Spanish speaking applicants if they spoke good English. This was considered an informal test not uniformly applied.
· Audience question: If creating a question on an application that asks if the applicant can lift 30 lbs (check box), is this a test? Yes, it’s a selection procedure and it needs to be validated
Refusal to Submit the 12 Item Compensation Data
o In the Bank of America case: they refused to submit the 12 item data. They said if the OFCCP is asking for it they must have reasonable suspicion. OFCCP response: No reasonable suspicion is necessary and there are no 4th amendment issues associated with the request.
o The purpose of a desk audit is to determine if there is a problem. See 60-1.43 and 1.4(a) for the regulation citation.
o In the Ledbetter case: Authority to gather information (compensation) was questioned. The OFCCP will gather all factors that influence compensation
§ Time frame occurrence having to do with a statute of limitations
o The purpose of the desk audit is to determine if there is reason to believe there is a violation
“I’m not on the scheduling list”
o Contractors often try to get out of an audit by stating they should not have been selected for an audit.
o Periodic reviews go beyond the FCSS list which is used for regular desk audits. There are also CMCE: corporate management compliance evaluations, FAAP: functional AAP audits, and DAS: directive review as well as other selection criteria not provided by OFCCP.
Contractor misconception: “We don’t have two (2) standard deviations to infer Adverse Impact or discrimination.”
o The courts have held that two or more standard deviations permit an inference of discrimination.
o Two standard deviations is NOT a threshold that must be met in order to continue an investigation
o Examples of reasons OFCCP will dig deeper:
o 0% Female and Minority in an areas you’d expect availability
o Tip to OFCCP about something potentially offensive
o Number of applicants = Number of hires (1:1 ratio)
o Quality check
o Any number of things could lead to further investigation
o There are no standards that says they cannot investigate further if desired
Correcting to have a result that shows less then two (2) standard deviations
o Another contractor misconception: Contractors argue that OFCCP cannot make the contractor eliminate the entire disparity as opposed to getting the result within two standard deviations.
o OFCCP: No, if results are discriminatory then shortfall should eliminate ALL disparity
o Favored group for comparison is not always male and white. OFCCP can go after selection disparities against all races and genders. (BCG note, we have seen OFCCP pursue Adverse Impact against whites and men in recent audits)
Statistics alone are not enough
o A pattern or practice case can be built on statistics alone. An increase in statistical disparity is more compelling to OFCCP
o If a contractor does not rebut a prima facie case of intentional discrimination then the courts can infer discrimination based on statistics
o OFCCP will seek anecdotal evidence where possible. Contractors should provide anecdotal evidence if available
o Comparisons of selected v. non-selected
§ Applied v. Offered
Statistical vs. Practical Significance (PS)
o Contractors argue that Practical Significance can imply that a contractors’ Adverse Impact analysis is not significant if a change in two hires brings the result to less than two standard deviations.
o OFCCP (Q&A #21 in UG): UGESP states that only switching one is allowed and it would have to bring the selection rate within 80%
o OFCCP PS:
§ Change 1-2 from fail to pass
§ Not an 80% violation
§ Not greater then 2 SD
The TNT Case – OFCCP argued that applicant pool was not atypical compared to competitors
o Would have to show the specialized recruitment drew unqualified individuals for the position
o Inflated race/gender
o The OFCCP can use competitor’s applicant pools as a comparison
“The data submitted for the audit is an aberration”
o Contractors attempting to argue to OFCCP that their audit issues should be attributed to: “You picked a bad year.”
o “My data is so bad it’s not worth analyzing” – Inadequate data does not reduce liability (BCG note – in fact we would expect it to dramatically increase the OFCCPs scrutiny of your organization)
o OFCCP can select the time period for review
o The OFCCP becomes suspicious of what has been done after the scheduling letter has been received.
Other defenses that will also receive scrutiny
o Lopsided refinements (look at both sides, i.e. men and women)
o Tolling liability because of case processing
o Mitigate at a higher pay rate
o Inadequate data reduces liability
Friday, December 12, 2008
E-Verify Requirements for Federal Contractors
Starting January 15, 2009 all federal contractors and sub-contractors are required to use the Department of Homeland Security’s E-Verify for all new hires. Its main purpose is to ensure that all new hires have legal rights to work in the U.S. This new requirement was put into effect through President George W. Bush’s signing of Executive Order 12989 on June 6, 2008. Please see full copy at http://www.whitehouse.gov/news/releases/2008/06/20080609-2.html
In order to be prepared for this new requirement, you must enroll in E-Verify either on line at https://www.vis-dhs.com/EmployerRegistration/StartPage.aspx , by calling the Department of Homeland Security (DHS) Customer Support line at 1-888-464-4218, or via e-mail E-Verify@dhs.gov. You have to use E-Verify for each new hire. Records of each submission and corresponding results should be retained for two years for all federal contractors.
In order to be prepared for this new requirement, you must enroll in E-Verify either on line at https://www.vis-dhs.com/EmployerRegistration/StartPage.aspx , by calling the Department of Homeland Security (DHS) Customer Support line at 1-888-464-4218, or via e-mail E-Verify@dhs.gov. You have to use E-Verify for each new hire. Records of each submission and corresponding results should be retained for two years for all federal contractors.
Monday, December 8, 2008
New Directive and other OFCCP resources
People consistently ask BCG "Why is OFCCP asking me for this?" Of course "this" may be a number of different things, but recently OFCCP has been rolling out new expectations as part of their latest audit push so we wanted to give people an idea what to expect going into 2009.
The bottom line, is that while OFCCP is still making most of their money on recordkeeping and adverse impact violations, they are still forging ahead into new territory on many new directives that are causing uncertainty in the contractor community.
One concern in-particular that we are seeing in almost every new audit is OFCCP asking for not only the structure of how the contractor is posting jobs, but for what Veterans Groups they are posting to, who is their contact and most importantly what the results of the postings are. Requesting details on the number of Veterans who applied is a new request. Whether OFCCP has the right to require this information is currently under debate. However, that has not stopped OFCCP from requesting the data in writing during a desk-audit.
Also, OFCCP is now reviewing the contractor's Applicant Tracking System to determine if there are any barriers that Veterans or the Disabled may face when applying for a job online. If there are perceived barriers, then an on-site visit might be triggered. There is a link below to the OFCCP Applicant Systems Directive in addition to a link on OFCCP resources that all contractors should bookmark.
Directory:
http://www.dol.gov/esa/ofccp/sitenavi.htm
Applicant Systems Directive:
http://www.dol.gov/esa/ofccp/regs/compliance/directives/dir281.htm
The bottom line, is that while OFCCP is still making most of their money on recordkeeping and adverse impact violations, they are still forging ahead into new territory on many new directives that are causing uncertainty in the contractor community.
One concern in-particular that we are seeing in almost every new audit is OFCCP asking for not only the structure of how the contractor is posting jobs, but for what Veterans Groups they are posting to, who is their contact and most importantly what the results of the postings are. Requesting details on the number of Veterans who applied is a new request. Whether OFCCP has the right to require this information is currently under debate. However, that has not stopped OFCCP from requesting the data in writing during a desk-audit.
Also, OFCCP is now reviewing the contractor's Applicant Tracking System to determine if there are any barriers that Veterans or the Disabled may face when applying for a job online. If there are perceived barriers, then an on-site visit might be triggered. There is a link below to the OFCCP Applicant Systems Directive in addition to a link on OFCCP resources that all contractors should bookmark.
Directory:
http://www.dol.gov/esa/ofccp/sitenavi.htm
Applicant Systems Directive:
http://www.dol.gov/esa/ofccp/regs/compliance/directives/dir281.htm
Wednesday, July 2, 2008
In Memory of Matt Halpern
Our firm was deeply saddened to hear of the recent passing of Matt Halpern. Biddle Consulting Group, Inc. (BCG) had the privilege to work with Matt Halpern for over four years on multiple projects, including seminars, audits, and related work. I personally had the honor to co-present with Matt at a number of seminars across the country. I will miss him dearly. Matt provided our field with years of incredible service and I believe his contributions will last for decades more.
Matt was one of the few people I knew who could remember the days of “calculating eight-factor availability analyses” using hand-held calculators. Not only was Matt a competent professional, he was gracious, fun, and had an incredible dedication to the EEO/AA field. At last year’s NILG conference, Matt stepped into an “emergency” leadership role after the tragic loss of Lois Baumerich. I spoke with Matt during this process and he shared that he was overwhelmed at the amount of work it took to take up his new lead role as conference chair. He invested hundreds of hours to put together what was one of the best ILGs our industry has enjoyed to date. Knowing Matt, I believe he did this out of a concern for the EEO/AA industry, more than his desire to be well-known in the industry or drive more business to his successful practice. I think that Matt cared about this industry. I believe that he spent his life making an incredible impact in the field of EEO and diversity. He was one of the most balanced EEO/AA attorneys I’ve known, which is why I enjoyed doing so much work with his firm. While Matt represented employers in literally all of his work, he represented the best interest of the EEO field while doing so, and I had the privilege of watching Matt honor employees and potential litigant class members in ways that were clearly marked by dignity and true character. Matt went beyond his role as a legal counsel for employers. His decisions and advocacy had a “big picture” in mind—one that included diversity, fairness, and awareness that major decisions impacted the lives of people, not just companies. I really appreciated this about Matt. It was a legacy I strive to follow.
We often don’t realize how quickly life goes by, and it passes by sooner for some than others. We cannot know our time; we can only invest each of our days wisely, as each is truly a gift. I only wish I knew the last time I spoke with Matt that it would have been our last time to talk. I would have spent more time enjoying things besides work. I am glad, however, that I did get to know Matt as a person and not just as a professional. I knew that Matt loved his family and his children. He was in love with his wife Andrea and very proud of his three children Annabelle, Georgie and Maddie as he spoke of their accomplishments and talents. I know they will miss their dad greatly. We will miss our good friend greatly. The industry will have a vacuum to fill.
Dan A. Biddle, Ph.D.
CEO, Biddle Consulting Group, Inc. / FPSI
Matt was one of the few people I knew who could remember the days of “calculating eight-factor availability analyses” using hand-held calculators. Not only was Matt a competent professional, he was gracious, fun, and had an incredible dedication to the EEO/AA field. At last year’s NILG conference, Matt stepped into an “emergency” leadership role after the tragic loss of Lois Baumerich. I spoke with Matt during this process and he shared that he was overwhelmed at the amount of work it took to take up his new lead role as conference chair. He invested hundreds of hours to put together what was one of the best ILGs our industry has enjoyed to date. Knowing Matt, I believe he did this out of a concern for the EEO/AA industry, more than his desire to be well-known in the industry or drive more business to his successful practice. I think that Matt cared about this industry. I believe that he spent his life making an incredible impact in the field of EEO and diversity. He was one of the most balanced EEO/AA attorneys I’ve known, which is why I enjoyed doing so much work with his firm. While Matt represented employers in literally all of his work, he represented the best interest of the EEO field while doing so, and I had the privilege of watching Matt honor employees and potential litigant class members in ways that were clearly marked by dignity and true character. Matt went beyond his role as a legal counsel for employers. His decisions and advocacy had a “big picture” in mind—one that included diversity, fairness, and awareness that major decisions impacted the lives of people, not just companies. I really appreciated this about Matt. It was a legacy I strive to follow.
We often don’t realize how quickly life goes by, and it passes by sooner for some than others. We cannot know our time; we can only invest each of our days wisely, as each is truly a gift. I only wish I knew the last time I spoke with Matt that it would have been our last time to talk. I would have spent more time enjoying things besides work. I am glad, however, that I did get to know Matt as a person and not just as a professional. I knew that Matt loved his family and his children. He was in love with his wife Andrea and very proud of his three children Annabelle, Georgie and Maddie as he spoke of their accomplishments and talents. I know they will miss their dad greatly. We will miss our good friend greatly. The industry will have a vacuum to fill.
Dan A. Biddle, Ph.D.
CEO, Biddle Consulting Group, Inc. / FPSI
Friday, June 27, 2008
National ILG in July, Sign Up Now!!
There is still time to register!!!
www.pacificilg.org
2008 INDUSTRY LIAISON GROUP NATIONAL CONFERENCE
JULY 29 – AUGUST 1, 2008
HYATT REGENCY HOTEL ORANGE COUNTY
(Near Disneyland )
Top 5 Reasons to Attend the 26 Annual ILG Conference!
• Hear from high ranking government officials from Washington , D.C. and across the country about emerging legal and regulatory developments in EEO/AA compliance
• Meet nationally renowned thought leaders in cutting through Glass Ceilings and Walls, Diversity & Inclusion, Education and Globalization, and their effects on the competitiveness of the nation’s workforce
• Learn about effective ways to manage converging trends in the 21st Century workforce, such as transgender, multi-generational, family care-giving, rising class actions and workplace disputes
• Understand the value proposition of moving your basic disabled and veterans programs into the realm of human capital management
• Professional Development for new and advanced EEO/AA/Diversity practitioners through in-depth exploration of topics and a variety of networking opportunities with other industry professionals
Pre-Registration: $695.00 On-Site Registration: $795.00
We look forward to seeing you!
Date: July 29 - August 1, 2008
Register Now
www.pacificilg.org
2008 INDUSTRY LIAISON GROUP NATIONAL CONFERENCE
JULY 29 – AUGUST 1, 2008
HYATT REGENCY HOTEL ORANGE COUNTY
(Near Disneyland )
Top 5 Reasons to Attend the 26 Annual ILG Conference!
• Hear from high ranking government officials from Washington , D.C. and across the country about emerging legal and regulatory developments in EEO/AA compliance
• Meet nationally renowned thought leaders in cutting through Glass Ceilings and Walls, Diversity & Inclusion, Education and Globalization, and their effects on the competitiveness of the nation’s workforce
• Learn about effective ways to manage converging trends in the 21st Century workforce, such as transgender, multi-generational, family care-giving, rising class actions and workplace disputes
• Understand the value proposition of moving your basic disabled and veterans programs into the realm of human capital management
• Professional Development for new and advanced EEO/AA/Diversity practitioners through in-depth exploration of topics and a variety of networking opportunities with other industry professionals
Pre-Registration: $695.00 On-Site Registration: $795.00
We look forward to seeing you!
Date: July 29 - August 1, 2008
Register Now
Tuesday, June 3, 2008
Conducting Adverse Impact Analyses – How Should I Analyze My Transactions?
Conducting Adverse Impact Tests – How should I analyze my transactions?
by Danielle Yokoi, Analyst II, Biddle Consulting Group
Adverse Impact is a hot topic amongst federal contractors. Adverse Impact is a sensitive topic because the Office of Federal Compliance Programs (OFFCP) is generating the majority of their make-whole relief dollars from adverse impact in Applicants v. Hires cases. That being said, the regulations (41 CFR § 60-2.17) require federal contractor’s to analyze their “personnel activity (including but not limited to applicant flow, hires, terminations, and promotions) to determine whether there are selection disparities.” However, the regulations do not provide guidance on how to analyze this information. This is left to the discretion of the contractor.
There are many ways to analyze your transaction data. The key to a meaningful analysis is to compare appropriate data or to use a common phrase “compare apples to apples”. Your first priority should be to ensure that you are comparing complete and accurate data. For those of you who have dealt with similar analyses in your work you know that collect good data is a surprisingly difficult task. Let’s use External Applicants v. External Hires (Selection Rate Comparison) as an example. Since applicant data is the most difficult item to track, and as a result is heavily scrutinized during compliance reviews, it should be the first thing you focus on when preparing for an audit. If the new definition of an internet applicant applies to your hiring process, then you should start by applying the four criteria to ensure that you have the most accurate file possible. The new definition on an internet applicant can be found here: http://www.dol.gov/esa/regs/fedreg/final/2005020176.htm. Once you are confident that you have an accurate pool of external applicants who were considered for an external hire, then you are ready to start conducting your analyses. If you need a tool to analyze your transactions, we offer a free Adverse Impact Toolkit on our website (http://www.biddle.com/adverseimpacttoolkit/).
There are several ways to group data in order to analyze personnel activity. A few approaches would be: by job group, job title, requisition, or job title + department. Often the use of a job group to analyze transactions is too broad because it aggregates multiple positions that may have dramatically different skills, qualifications, and responsibilities. You should look closely at the most appropriate grouping for your organization and your hiring processes.
After determining what grouping method is appropriate, the next decision to make is which test should to employ. I will discuss the three most common, 80% (4/5th Rule), Chi2, and Fisher’s Exact.
The 80% rule is the old-school Impact Ratio Analysis method that is still around but it is fading fast in it’s usage since OFCCP started focusing on Systemic Discrimination. It compares groups to determine if the selection rate of females/minorities is within 80% of the selection rate of male/non-minorities. This rule was appropriate years ago when analyses were conducted by hand. Today, we have computers that allow us to use more powerful statistical tools with a click of a button.
Two common statistical tools previously mentioned are the Chi2 and Fisher’s Exact. The tools are similar in that they both generate a standard deviation (threshold ≥ 1.96). However, the Chi2 will generate an estimated standard deviation while the Fisher’s Exact will generate an exact standard deviation. Additionally, the Chi2 test decreases in accuracy as sample sizes become smaller and are therefore not appropriate in some cases. However, since OFCCP is accustomed to the simpler test method, they often use Chi2 during audits. We encourage you to rely on the Fisher’s Exact to ensure accurate results and to counter an potential arguments by OFCCP that you have statistical significance when in fact the Exact test may not. Exact tests can handle large and small sample sizes and as I previously stated, it provides exact results. BCG has successfully argued the use of the Fisher’s Exact test and its results during many audits in recent years.
A final note. It is recommended that any potentially sensitive analyses be conducted under Attorney Client Privilege to keep the results from being used against you by OFFCP or a plaintiff attorney.
Below is a summary of the steps detailed above.
Clean data thoroughly using the updated definition of an applicant
Choose an appropriate grouping method
Run analysis to identify legitimate problem areas
Choose a meaningful statistical test
Interpret results and re-analyze if necessary
Happy Analyzing!
by Danielle Yokoi, Analyst II, Biddle Consulting Group
Adverse Impact is a hot topic amongst federal contractors. Adverse Impact is a sensitive topic because the Office of Federal Compliance Programs (OFFCP) is generating the majority of their make-whole relief dollars from adverse impact in Applicants v. Hires cases. That being said, the regulations (41 CFR § 60-2.17) require federal contractor’s to analyze their “personnel activity (including but not limited to applicant flow, hires, terminations, and promotions) to determine whether there are selection disparities.” However, the regulations do not provide guidance on how to analyze this information. This is left to the discretion of the contractor.
There are many ways to analyze your transaction data. The key to a meaningful analysis is to compare appropriate data or to use a common phrase “compare apples to apples”. Your first priority should be to ensure that you are comparing complete and accurate data. For those of you who have dealt with similar analyses in your work you know that collect good data is a surprisingly difficult task. Let’s use External Applicants v. External Hires (Selection Rate Comparison) as an example. Since applicant data is the most difficult item to track, and as a result is heavily scrutinized during compliance reviews, it should be the first thing you focus on when preparing for an audit. If the new definition of an internet applicant applies to your hiring process, then you should start by applying the four criteria to ensure that you have the most accurate file possible. The new definition on an internet applicant can be found here: http://www.dol.gov/esa/regs/fedreg/final/2005020176.htm. Once you are confident that you have an accurate pool of external applicants who were considered for an external hire, then you are ready to start conducting your analyses. If you need a tool to analyze your transactions, we offer a free Adverse Impact Toolkit on our website (http://www.biddle.com/adverseimpacttoolkit/).
There are several ways to group data in order to analyze personnel activity. A few approaches would be: by job group, job title, requisition, or job title + department. Often the use of a job group to analyze transactions is too broad because it aggregates multiple positions that may have dramatically different skills, qualifications, and responsibilities. You should look closely at the most appropriate grouping for your organization and your hiring processes.
After determining what grouping method is appropriate, the next decision to make is which test should to employ. I will discuss the three most common, 80% (4/5th Rule), Chi2, and Fisher’s Exact.
The 80% rule is the old-school Impact Ratio Analysis method that is still around but it is fading fast in it’s usage since OFCCP started focusing on Systemic Discrimination. It compares groups to determine if the selection rate of females/minorities is within 80% of the selection rate of male/non-minorities. This rule was appropriate years ago when analyses were conducted by hand. Today, we have computers that allow us to use more powerful statistical tools with a click of a button.
Two common statistical tools previously mentioned are the Chi2 and Fisher’s Exact. The tools are similar in that they both generate a standard deviation (threshold ≥ 1.96). However, the Chi2 will generate an estimated standard deviation while the Fisher’s Exact will generate an exact standard deviation. Additionally, the Chi2 test decreases in accuracy as sample sizes become smaller and are therefore not appropriate in some cases. However, since OFCCP is accustomed to the simpler test method, they often use Chi2 during audits. We encourage you to rely on the Fisher’s Exact to ensure accurate results and to counter an potential arguments by OFCCP that you have statistical significance when in fact the Exact test may not. Exact tests can handle large and small sample sizes and as I previously stated, it provides exact results. BCG has successfully argued the use of the Fisher’s Exact test and its results during many audits in recent years.
A final note. It is recommended that any potentially sensitive analyses be conducted under Attorney Client Privilege to keep the results from being used against you by OFFCP or a plaintiff attorney.
Below is a summary of the steps detailed above.
Clean data thoroughly using the updated definition of an applicant
Choose an appropriate grouping method
Run analysis to identify legitimate problem areas
Choose a meaningful statistical test
Interpret results and re-analyze if necessary
Happy Analyzing!
Sunday, April 27, 2008
Increasing Your Chances of Closing an OFCCP Audit
Increasing Your Chances of Closing an OFCCP Audit
by Marife Ramos, Sr. Consultant, Biddle Consulting Group
Winning an OFCCP audit is not as hard as most contractors think. In most cases, a contractor can control the outcome of an OFCCP review. The employer’s goal should be to end an OFCCP audit at the Desk Audit phase. Consider the following before submitting your AAP and data to the OFCCP:
1) Know your auditor. Give him/her a call upon receipt of the letter. Introduce yourself. Ensure him/her that you intend to extend full cooperation during the audit.
2) Review all the data and reports for accuracy and completeness before submittal. Perform data refinements based on the definition of applicants. Once data and reports are already submitted, it becomes more difficult to make necessary revisions. Any revisions to the already submitted data and reports can cast doubt on your record-keeping policies and procedures.
3) Analyze the data before submittal. The OFCCP’s main focus during an audit is on adverse impact of the personnel transactions and compensation disparities. Know what the OFCCP may find ahead of time with the data you will provide.
4) Document and emphasize all Good Faith Efforts. This is your opportunity to “put your best foot forward.” Let the OFCCP know all the EEO Good Things your organization have done and is planning to do.
5) Prepare a professional and professional-looking AAP. Remember that the AAP is supposed to be a living-breathing document for your organization. Show that you are very familiar of the contents of the AAP and are utilizing the results of the analyses in planning for future employment opportunities.
6) Perform “mock audits” on a more regular basis. Analyze your data on a quarterly or semi-annual basis. This will provide good information and assist in employment planning and management training throughout the AAP year.
7) Document all conversations with your compliance officer. Your records might help you in future negotiations with the agency.
8) Do not miss your submission deadline. Remember, you have only 30 days to respond to the OFCCP. So get to work as soon as you receive the audit letter. As much as possible, submit the AAP on time. It demonstrates your willingness to cooperate and compliance with the requirements. If an extension was requested and is granted by the OFCCP, do not miss the extension deadline.
9) Get HELP! When you doubt your ability to respond accurately to an audit, get the assistance of reputable AAP experts/consultants. This will prove to be a lesser cost to pay than settlements from Conciliation Agreements or worse, losing the federal contract.
by Marife Ramos, Sr. Consultant, Biddle Consulting Group
Winning an OFCCP audit is not as hard as most contractors think. In most cases, a contractor can control the outcome of an OFCCP review. The employer’s goal should be to end an OFCCP audit at the Desk Audit phase. Consider the following before submitting your AAP and data to the OFCCP:
1) Know your auditor. Give him/her a call upon receipt of the letter. Introduce yourself. Ensure him/her that you intend to extend full cooperation during the audit.
2) Review all the data and reports for accuracy and completeness before submittal. Perform data refinements based on the definition of applicants. Once data and reports are already submitted, it becomes more difficult to make necessary revisions. Any revisions to the already submitted data and reports can cast doubt on your record-keeping policies and procedures.
3) Analyze the data before submittal. The OFCCP’s main focus during an audit is on adverse impact of the personnel transactions and compensation disparities. Know what the OFCCP may find ahead of time with the data you will provide.
4) Document and emphasize all Good Faith Efforts. This is your opportunity to “put your best foot forward.” Let the OFCCP know all the EEO Good Things your organization have done and is planning to do.
5) Prepare a professional and professional-looking AAP. Remember that the AAP is supposed to be a living-breathing document for your organization. Show that you are very familiar of the contents of the AAP and are utilizing the results of the analyses in planning for future employment opportunities.
6) Perform “mock audits” on a more regular basis. Analyze your data on a quarterly or semi-annual basis. This will provide good information and assist in employment planning and management training throughout the AAP year.
7) Document all conversations with your compliance officer. Your records might help you in future negotiations with the agency.
8) Do not miss your submission deadline. Remember, you have only 30 days to respond to the OFCCP. So get to work as soon as you receive the audit letter. As much as possible, submit the AAP on time. It demonstrates your willingness to cooperate and compliance with the requirements. If an extension was requested and is granted by the OFCCP, do not miss the extension deadline.
9) Get HELP! When you doubt your ability to respond accurately to an audit, get the assistance of reputable AAP experts/consultants. This will prove to be a lesser cost to pay than settlements from Conciliation Agreements or worse, losing the federal contract.
Self Identification Requirements for Applicants with Disabilities
Self Identification Requirements for Applicants with Disabilities
and/or Veterans
by Marife Ramos, Sr. Consultant, Biddle Consulting Group
As a part of their record-keeping requirements, federal contractors are required to make good faith efforts to solicit the race and gender information of their applicants (41 CFR 60-1.12). Voluntary self-identification forms to solicit race and gender information can be provided to job seekers at any stage of the application process. However, the regulations only require that the invitation to self-identify be extended when a job seeker becomes an applicant.
It is a different story however, when it comes to the solicitation of the applicants’ disability and/or veteran status(es). Contractors may not invite applicants to self-identify as disabled and/or veterans before a job is offered. Invitations for self- identifications can be made by contractors only at the post-offer stage but before employment. Also, it should be noted that the regulations at 41 CFR 60-741.42 listed only two exceptions to this requirement.
What does this mean to contractors? Contractors may not solicit disability or veteran status from applicants in general. Self-id invitations should be made after a job offer is made but NOT after the applicant becomes an employee. It is therefore, recommended that contractors should develop two self-identification forms for applicants: 1) to solicit gender and race for applicants in general; and 2) to solicit disability and veteran status after a job offer is made but before official employment occurs (race and gender information can again be solicited at this stage). It is also recommended that contractors should establish a well-defined system that can remind hiring personnel to provide the self-id form to an applicant who was offered a job but before such applicant becomes officially an employee (for example, include the self-id form with the I-9 or W-4 forms to be filled by the prospective employee).
and/or Veterans
by Marife Ramos, Sr. Consultant, Biddle Consulting Group
As a part of their record-keeping requirements, federal contractors are required to make good faith efforts to solicit the race and gender information of their applicants (41 CFR 60-1.12). Voluntary self-identification forms to solicit race and gender information can be provided to job seekers at any stage of the application process. However, the regulations only require that the invitation to self-identify be extended when a job seeker becomes an applicant.
It is a different story however, when it comes to the solicitation of the applicants’ disability and/or veteran status(es). Contractors may not invite applicants to self-identify as disabled and/or veterans before a job is offered. Invitations for self- identifications can be made by contractors only at the post-offer stage but before employment. Also, it should be noted that the regulations at 41 CFR 60-741.42 listed only two exceptions to this requirement.
What does this mean to contractors? Contractors may not solicit disability or veteran status from applicants in general. Self-id invitations should be made after a job offer is made but NOT after the applicant becomes an employee. It is therefore, recommended that contractors should develop two self-identification forms for applicants: 1) to solicit gender and race for applicants in general; and 2) to solicit disability and veteran status after a job offer is made but before official employment occurs (race and gender information can again be solicited at this stage). It is also recommended that contractors should establish a well-defined system that can remind hiring personnel to provide the self-id form to an applicant who was offered a job but before such applicant becomes officially an employee (for example, include the self-id form with the I-9 or W-4 forms to be filled by the prospective employee).
The Most Common Mistake in AAP Audit Preparation
The Most Common Mistake in AAP Audit Preparation
by Nina Le-Tse, Consultant, Biddle Consulting Group
Biddle Consulting Group has worked with a high volume of Federal contractors under OFCCP audit. Having worked with contractors in many industries and ranging in size from fifty employees to over one hundred thousand employees within the various OFCCP regions, we consistently encounter recordkeeping as the one common issue that easily results in the highest number of conciliation agreements. Many people are not aware of the fact that OFCCP has access to all of your transaction (i.e., Applicants, Hires, Promotions, and Terminations) data in the event of an audit. The OFCCP will use their internal systems to conduct adverse impact analyses based on the transaction data that was provided to determine if there is a substantial difference in selection rates between men and women and/or whites and minorities. If there is statistical significance in the summary data provided, OFCCP will request the raw data that was compiled for the desk audit submittal. Once they have the detailed data, it is much more difficult to go back and “fix” flawed files. Resubmitting data repeatedly only results in more suspicion on the part of the OFCCP and could likely end up in an on-site visit.
Conducting adverse impact analyses is not just about the result of the statistical test; it’s about having the right data. If there is adverse impact in the initial analysis of hires data being compared to applicants, there are often appropriate refinements that you can make to the data. For example:
· Only include applicants who are associated with hires in the plan. If you had an applicant pool tied to a job requisition that closed before making a hire then those applicants do not need to be included in your submittal.
· Applicants may occur outside the 12-month transaction period if they are linked to hires that occurred within the appropriate 12-month period
· Applicants do not belong in the file if they applied for a position after the last hire in the 12-month plan period. If you have a calendar year plan where your last hire was November 30th, then you should not have any applicant data in December as part of your current AAP. They may be linked to a hire in your future AAP but not the current one.
· Applicants should only be listed once unless they applied for and were considered for more than one job.
· A hired candidate’s race and gender should be reconciled against the original applicant file
· Remember that you must keep all applicant records for two years whether they are in your AAP or not.
The OFCCP is also focused on low applicant-to-hire ratios and high percentages of unknown race and gender. Be sure to track all considered applicants for the analyzed hires and invite all applicants to self identify their race and gender.
While the updated “Definition of an Applicant” should be applied at the onset, you may further refine the data by reviewing it to be sure that each of the four requirements are met.
Document all your selection process is one of the key elements to good recordkeeping. If you have multiple employees tracking the applicant flow log, make sure that they follow the same protocols. Keep all applicant records including those used to develop your affirmative action plan(s) for the minimum of two years (or one year if you qualify for the exemption).
by Nina Le-Tse, Consultant, Biddle Consulting Group
Biddle Consulting Group has worked with a high volume of Federal contractors under OFCCP audit. Having worked with contractors in many industries and ranging in size from fifty employees to over one hundred thousand employees within the various OFCCP regions, we consistently encounter recordkeeping as the one common issue that easily results in the highest number of conciliation agreements. Many people are not aware of the fact that OFCCP has access to all of your transaction (i.e., Applicants, Hires, Promotions, and Terminations) data in the event of an audit. The OFCCP will use their internal systems to conduct adverse impact analyses based on the transaction data that was provided to determine if there is a substantial difference in selection rates between men and women and/or whites and minorities. If there is statistical significance in the summary data provided, OFCCP will request the raw data that was compiled for the desk audit submittal. Once they have the detailed data, it is much more difficult to go back and “fix” flawed files. Resubmitting data repeatedly only results in more suspicion on the part of the OFCCP and could likely end up in an on-site visit.
Conducting adverse impact analyses is not just about the result of the statistical test; it’s about having the right data. If there is adverse impact in the initial analysis of hires data being compared to applicants, there are often appropriate refinements that you can make to the data. For example:
· Only include applicants who are associated with hires in the plan. If you had an applicant pool tied to a job requisition that closed before making a hire then those applicants do not need to be included in your submittal.
· Applicants may occur outside the 12-month transaction period if they are linked to hires that occurred within the appropriate 12-month period
· Applicants do not belong in the file if they applied for a position after the last hire in the 12-month plan period. If you have a calendar year plan where your last hire was November 30th, then you should not have any applicant data in December as part of your current AAP. They may be linked to a hire in your future AAP but not the current one.
· Applicants should only be listed once unless they applied for and were considered for more than one job.
· A hired candidate’s race and gender should be reconciled against the original applicant file
· Remember that you must keep all applicant records for two years whether they are in your AAP or not.
The OFCCP is also focused on low applicant-to-hire ratios and high percentages of unknown race and gender. Be sure to track all considered applicants for the analyzed hires and invite all applicants to self identify their race and gender.
While the updated “Definition of an Applicant” should be applied at the onset, you may further refine the data by reviewing it to be sure that each of the four requirements are met.
Document all your selection process is one of the key elements to good recordkeeping. If you have multiple employees tracking the applicant flow log, make sure that they follow the same protocols. Keep all applicant records including those used to develop your affirmative action plan(s) for the minimum of two years (or one year if you qualify for the exemption).
Tuesday, April 1, 2008
Introducing the 2008 Biddle Consulting Group/Jackson Lewis Seminar Series
Introducing:
The 2008 Biddle Consulting Group, Inc. and Jackson Lewis LLP Seminar Series
EMPLOYERS CAUGHT IN THE PERFECT STORM: THE CONVERGENCE OF THE OFCCP’S AND EEOC’S SYSTEMIC DISCRIMINATION INITIATIVES
Agenda:
1. Understanding Federal EEO Enforcement Agency Trends. An Update on the Current Focus of the EEOC and OFCCP
2. How to Prepare for an OFCCP Audit Under the OFCCP’s New Rules: Selection Stage Analysis, Technical Compliance and Other Liability Hotspots
3. Update on the Not so New Internet Applicant Rule. How the OFCCP Can Use the Internet Applicant Regulations As A Tool for Auditing and Identifying Discrimination
4. Leveraging Affirmative Action Goals Into Your Diversity Initiatives? Lawful Pathways to Diversity
5. I Think My Test is Valid . . . Why Do You Ask? Defending Your Testing Practices in Title VII and OFCCP Enforcement Settings
6. Shoring Up for the Coming Tidal Wave of Compensation Claims? Navigating Through Legal and Statistical Systemic Compensation Issues
Locations and Dates:
Boston - June 3rd, 2008, Marriott Boston Copley Place, 110 Huntington Avenue, Boston, MA, 02116, (617) 236-5800
Orlando - June 5th, 2008, Marriott Orlando Downtown, 400 W. Livingston St. Orlando, FL 32801
(407-843-6664)
Chicago - September 22nd, 2008, Chicago Marriott Downtown, 540 North Michigan Avenue, Chicago, IL 60611 (312) 836-0100 / Web Address: www.chicagomarriottdowntown.com
Dallas - September 24th, 2008, Marriott Dallas/Fort Worth Airport North, 8440 Freeport Parkway, Irving, TX, 75063, (972) 929-8800
San Francisco - November 4th, 2008, JW Marriott San Francisco, 500 Post Street
San Francisco, CA 94102 (415-771-8600)
Los Angeles – November 18th 2008, Los Angeles Downtown Marriott, 333 S. Figueroa St. Los Angeles, CA 90071 (213 617-6038)
Costs for attending:
The fee is $495 per attendee with discounts offered for multiple attendees.
Call 1-916-294-4250 x109 to reserve your seat today.
Hotel reservations must be made by calling the hotel directly at the number(s) listed above.
The 2008 Biddle Consulting Group, Inc. and Jackson Lewis LLP Seminar Series
EMPLOYERS CAUGHT IN THE PERFECT STORM: THE CONVERGENCE OF THE OFCCP’S AND EEOC’S SYSTEMIC DISCRIMINATION INITIATIVES
Agenda:
1. Understanding Federal EEO Enforcement Agency Trends. An Update on the Current Focus of the EEOC and OFCCP
2. How to Prepare for an OFCCP Audit Under the OFCCP’s New Rules: Selection Stage Analysis, Technical Compliance and Other Liability Hotspots
3. Update on the Not so New Internet Applicant Rule. How the OFCCP Can Use the Internet Applicant Regulations As A Tool for Auditing and Identifying Discrimination
4. Leveraging Affirmative Action Goals Into Your Diversity Initiatives? Lawful Pathways to Diversity
5. I Think My Test is Valid . . . Why Do You Ask? Defending Your Testing Practices in Title VII and OFCCP Enforcement Settings
6. Shoring Up for the Coming Tidal Wave of Compensation Claims? Navigating Through Legal and Statistical Systemic Compensation Issues
Locations and Dates:
Boston - June 3rd, 2008, Marriott Boston Copley Place, 110 Huntington Avenue, Boston, MA, 02116, (617) 236-5800
Orlando - June 5th, 2008, Marriott Orlando Downtown, 400 W. Livingston St. Orlando, FL 32801
(407-843-6664)
Chicago - September 22nd, 2008, Chicago Marriott Downtown, 540 North Michigan Avenue, Chicago, IL 60611 (312) 836-0100 / Web Address: www.chicagomarriottdowntown.com
Dallas - September 24th, 2008, Marriott Dallas/Fort Worth Airport North, 8440 Freeport Parkway, Irving, TX, 75063, (972) 929-8800
San Francisco - November 4th, 2008, JW Marriott San Francisco, 500 Post Street
San Francisco, CA 94102 (415-771-8600)
Los Angeles – November 18th 2008, Los Angeles Downtown Marriott, 333 S. Figueroa St. Los Angeles, CA 90071 (213 617-6038)
Costs for attending:
The fee is $495 per attendee with discounts offered for multiple attendees.
Call 1-916-294-4250 x109 to reserve your seat today.
Hotel reservations must be made by calling the hotel directly at the number(s) listed above.
Monday, March 31, 2008
When is an Adverse Impact Analysis really significant?
When is an Adverse Impact Analysis really significant?
by Desiree Throckmorton, Consultant, Biddle Consulting Group
Before the advent of personal computers it was necessary for EEO enforcement agencies to enlist very simple mathematical techniques for identifying potential discrimination in selection processes. As a result, when the Federal Uniform Guidelines for Employee Selection Procedures (UGESP) were released in 1978 they discussed a mathematical process known as the 80% test (aka Impact Ratio Analysis or IRA), whereby the selection rates of the disadvantaged groups were compared to the selection rate of the advantaged group. If the disadvantaged group’s rate was less than 80% of the rate of the advantaged group it was said there was an “adverse impact” against the protected group. Many employers still rely on this test, because it is simple to compute and understand. However, to determine true problem areas we suggest utilizing more sophisticated techniques.
A more advanced, yet limited approach to comparing selection rates is the chi-square (x2) statistic. The strength of the x2 lies primarily in two areas: 1) it’s simplicity to calculate (from a computational standpoint), and 2) its foundations in a normal probability distribution (i.e., the ability to identify the likelihood that the differences in selection rates are occurring by chance). Unfortunately, as with many other statistical formulas, the x2 suffers from a need for sufficient sample size. As a result, the x2 is not recommended when sample sizes are less than 30. The Federal Contract Compliance Manual (FCCM) as written by the U.S Department of Labor, Employment Standards Administration, Office of Federal Compliance Programs (OFCCP) states that if samples sizes are less 30, and the number of expected minority/female selection is less than 5, then the Fisher’s Exact test should be employed. Fisher’s Exact test is considered a more accurate statistic. Unfortunately, the Fisher exact calculation is extremely complex and requires processor power that was not readily available in 1978, when the UGESP were published. As a result, the analytical philosophy was to recommend the Fisher exact test ONLY when the sample sizes were less than 30. However, with personal computers now able to handle billions of computations in a matter of seconds they can quickly and efficiently calculate the Fisher exact statistic regardless of how large the sample sizes are.
It has been our experience that during OFCCP Compliance Reviews that many Compliance Officers are still focusing on x2 results. We recommend that you arm your company with more legitimate analyses using the Fisher’s Exact test.
To summarize, while the chi-square results will closely approximate the Fisher’s Exact test when sample sizes are greater than 30, there is no longer any reason to use the chi-square statistic. The Fisher’s Exact statistic will result in the exact probability associated with selection rate differences every time, regardless of sample size. Additionally, it is much more accurate with sample sizes less than 30. In EEO compliance work, Biddle Consulting Group finds the use of the Fisher’s Exact Test to be a critical tool for determining if comparison results are statistically significant. It is very common with moderate sample sizes for the Fisher’s Exact probability result to be slightly lower than the chi-square statistic, which can mean the difference between showing a significant or non-significant result in your affirmative action planning efforts. If OFCCP is making an argument that your have adverse impact based on the chi-square statistic and your Fisher’s Exact test says otherwise, wouldn’t you want to know?
by Desiree Throckmorton, Consultant, Biddle Consulting Group
Before the advent of personal computers it was necessary for EEO enforcement agencies to enlist very simple mathematical techniques for identifying potential discrimination in selection processes. As a result, when the Federal Uniform Guidelines for Employee Selection Procedures (UGESP) were released in 1978 they discussed a mathematical process known as the 80% test (aka Impact Ratio Analysis or IRA), whereby the selection rates of the disadvantaged groups were compared to the selection rate of the advantaged group. If the disadvantaged group’s rate was less than 80% of the rate of the advantaged group it was said there was an “adverse impact” against the protected group. Many employers still rely on this test, because it is simple to compute and understand. However, to determine true problem areas we suggest utilizing more sophisticated techniques.
A more advanced, yet limited approach to comparing selection rates is the chi-square (x2) statistic. The strength of the x2 lies primarily in two areas: 1) it’s simplicity to calculate (from a computational standpoint), and 2) its foundations in a normal probability distribution (i.e., the ability to identify the likelihood that the differences in selection rates are occurring by chance). Unfortunately, as with many other statistical formulas, the x2 suffers from a need for sufficient sample size. As a result, the x2 is not recommended when sample sizes are less than 30. The Federal Contract Compliance Manual (FCCM) as written by the U.S Department of Labor, Employment Standards Administration, Office of Federal Compliance Programs (OFCCP) states that if samples sizes are less 30, and the number of expected minority/female selection is less than 5, then the Fisher’s Exact test should be employed. Fisher’s Exact test is considered a more accurate statistic. Unfortunately, the Fisher exact calculation is extremely complex and requires processor power that was not readily available in 1978, when the UGESP were published. As a result, the analytical philosophy was to recommend the Fisher exact test ONLY when the sample sizes were less than 30. However, with personal computers now able to handle billions of computations in a matter of seconds they can quickly and efficiently calculate the Fisher exact statistic regardless of how large the sample sizes are.
It has been our experience that during OFCCP Compliance Reviews that many Compliance Officers are still focusing on x2 results. We recommend that you arm your company with more legitimate analyses using the Fisher’s Exact test.
To summarize, while the chi-square results will closely approximate the Fisher’s Exact test when sample sizes are greater than 30, there is no longer any reason to use the chi-square statistic. The Fisher’s Exact statistic will result in the exact probability associated with selection rate differences every time, regardless of sample size. Additionally, it is much more accurate with sample sizes less than 30. In EEO compliance work, Biddle Consulting Group finds the use of the Fisher’s Exact Test to be a critical tool for determining if comparison results are statistically significant. It is very common with moderate sample sizes for the Fisher’s Exact probability result to be slightly lower than the chi-square statistic, which can mean the difference between showing a significant or non-significant result in your affirmative action planning efforts. If OFCCP is making an argument that your have adverse impact based on the chi-square statistic and your Fisher’s Exact test says otherwise, wouldn’t you want to know?
Thursday, February 21, 2008
OFCCP Releases Second Fiscal Year 2008 Scheduling List
From OFCCP Home Page:
Second FY 2008 Scheduling List Released
A second list of supply and service contractor establishments will be available to OFCCP regional offices beginning on March 10, 2008 for scheduling of compliance evaluations during this scheduling cycle (currently, October 1, 2007 through September 30, 2008). The first release for FY 2008 was made available to the regional offices for scheduling on October 1, 2007.
This release includes approximately 5000 facilities that have either self-identified as being an establishment of a Federal contractor, or have been identified as such by OFCCP. OFCCP generated this list through its Federal Contractor Selection System (FCSS) using multiple information sources and analytical procedures to select contractors for evaluation, including a mathematical model that ranks Federal contractor establishments based on an indicator of potential workplace discrimination. The list also includes a number of establishments identified through external Federal contract databases as part of OFCCP's Contracts First Initiative.
Second FY 2008 Scheduling List Released
A second list of supply and service contractor establishments will be available to OFCCP regional offices beginning on March 10, 2008 for scheduling of compliance evaluations during this scheduling cycle (currently, October 1, 2007 through September 30, 2008). The first release for FY 2008 was made available to the regional offices for scheduling on October 1, 2007.
This release includes approximately 5000 facilities that have either self-identified as being an establishment of a Federal contractor, or have been identified as such by OFCCP. OFCCP generated this list through its Federal Contractor Selection System (FCSS) using multiple information sources and analytical procedures to select contractors for evaluation, including a mathematical model that ranks Federal contractor establishments based on an indicator of potential workplace discrimination. The list also includes a number of establishments identified through external Federal contract databases as part of OFCCP's Contracts First Initiative.
OFCCP Selects Dr. Javaid Kaiser To Be Head Statistician
As reported by Bill Truesdell in the Management-Advantage Newsletter:
OFCCP APPOINTS DR. JAVAID KAISER TO HEAD STATISTICAL SECTION
Effective February 19, 2008, Dr. Javaid Kaiser will take over as the Director of Statistical Analysis at the Office of Federal Contract Compliance Programs (OFCCP). He will fill the vacancy created when Dr. Michael Sinclair left the agency in October last year. Dr. Kaiser comes to OFCCP from the position as Director of the Office of Applied Studies at the Substance Abuse and Mental Health Services Administration. He has also been a researcher at Virginia Polytechnic Institute and East Carolina University among others.
By filling this vacancy, Mr. Charles James, National Director of OFCCP seems to be saying that his agency's focus on systemic discrimination issues will continue unabated.
OFCCP APPOINTS DR. JAVAID KAISER TO HEAD STATISTICAL SECTION
Effective February 19, 2008, Dr. Javaid Kaiser will take over as the Director of Statistical Analysis at the Office of Federal Contract Compliance Programs (OFCCP). He will fill the vacancy created when Dr. Michael Sinclair left the agency in October last year. Dr. Kaiser comes to OFCCP from the position as Director of the Office of Applied Studies at the Substance Abuse and Mental Health Services Administration. He has also been a researcher at Virginia Polytechnic Institute and East Carolina University among others.
By filling this vacancy, Mr. Charles James, National Director of OFCCP seems to be saying that his agency's focus on systemic discrimination issues will continue unabated.
OFCCP Stepping Up Efforts To Analyze Appropriate Data
By Danielle Yokoi, Analyst, Biddle Consulting Group
The Office of Federal Contract and Compliance Programs (OFCCP) recently conducted a webinar to update the Federal contracting community on their operations. During the update OFCCP announced they are conducting 4,000-5,000 desk audits per year. Approximately 10-15% of the audits that ended in conciliation agreement and 70% of the conciliation agreements resulted in some type of financial penalty. Federal contractors should be aware the OFCCP is concentrating on finding statistically significant differences between comparison groups (i.e. Males v. Females), particularly in the hiring process.
In regards to analyzing the hiring process, Biddle Consulting Group participated in an audit recently where OFCCP did something that we rarely see. They utilized the Final Rule on "Obligation To Solicit Race and Gender Data for Agency Enforcement Purposes" (Also known as the Definition of an Internet Applicant) to refine the data themselves.
With the revised definition of the Internet Applicant now in full effect, contractors are expected to apply the rule to their applicant data at all times, and especially in the event of an audit. During a recent audit, OFCCP found potential adverse impact in a job group where the selection rate of hires differed greatly from the applicant pool. OFCCP requested to come on-site and review applications for these positions. The compliance officer then contacted applicants directly in order to revise the data based on the four criteria from the definition of an internet applicant to the contractors’ applicant log. This resulted in a smaller, more appropriate applicant log. Be aware that not every region of the OFFCP may take this approach, and it should be mandatory to ensure your data is accurate before submittal to OFCCP during an audit, but it was nice to see a compliance officer making the effort to analyze the most appropriate data.
The Office of Federal Contract and Compliance Programs (OFCCP) recently conducted a webinar to update the Federal contracting community on their operations. During the update OFCCP announced they are conducting 4,000-5,000 desk audits per year. Approximately 10-15% of the audits that ended in conciliation agreement and 70% of the conciliation agreements resulted in some type of financial penalty. Federal contractors should be aware the OFCCP is concentrating on finding statistically significant differences between comparison groups (i.e. Males v. Females), particularly in the hiring process.
In regards to analyzing the hiring process, Biddle Consulting Group participated in an audit recently where OFCCP did something that we rarely see. They utilized the Final Rule on "Obligation To Solicit Race and Gender Data for Agency Enforcement Purposes" (Also known as the Definition of an Internet Applicant) to refine the data themselves.
With the revised definition of the Internet Applicant now in full effect, contractors are expected to apply the rule to their applicant data at all times, and especially in the event of an audit. During a recent audit, OFCCP found potential adverse impact in a job group where the selection rate of hires differed greatly from the applicant pool. OFCCP requested to come on-site and review applications for these positions. The compliance officer then contacted applicants directly in order to revise the data based on the four criteria from the definition of an internet applicant to the contractors’ applicant log. This resulted in a smaller, more appropriate applicant log. Be aware that not every region of the OFFCP may take this approach, and it should be mandatory to ensure your data is accurate before submittal to OFCCP during an audit, but it was nice to see a compliance officer making the effort to analyze the most appropriate data.
Monday, February 18, 2008
Reviewing the updated Vets requirements
By Christine Anthony, Analyst, Biddle Consulting Group
OFCCP issued a Final Rule (Code of Federal Regulations [CFR] § 60-300) effective September 7, 2007 which addressed the Affirmative Action Plan (AAP) requirements and mandatory listing requirements for veterans.
The Jobs for Veterans Act (JVA) increased the threshold of coverage of a single contract from $25,000 to $100,000 or more for contracts that are owned or modified on or after December 1, 2003. The AAP content for contracts under the new threshold must contain the following: policy statement, review of personnel process, reasonable accommodation to physical and mental limitations, policy to prevent harassment, external dissemination of policy, internal dissemination policy, audit and reporting system, responsibility for implementation, and training policy. These are the same requirements under CFR § 60-250.
The classification of veterans has changed. The current classifications are: Armed Forces Service Medical Recipient, Disabled Veterans (service connected), Recently Separated Veterans (past 3 years), and Other Protected Veterans. The classification of Vietnam Era Veteran has been elimination. However, it is probable that those falling under this classification will fit within the parameters of at least one of the new classifications. The Newly Separated Veterans has been redefined to include veterans who have separated from service within the past three years rather than the past year as the previous definition stated. Finally, the Disabled Veterans category has been expanded to include all veterans with a service-related disability, regardless of the disability rating.
Several contractors may find themselves with the need to comply with both sections of the CFR. In that case, the contractor can choose to create two AAPs or they may develop a single AAP following CFR § 60-300. Please see Appendix B of the Final Rule for further guidance on how to solicit veteran status.
Changes have also been made to the mandatory job listing requirements. Contractors falling within the contract thresholds must list all job openings with the state workforce agency job bank as well as a local employment service delivery system. Contractors must list in the notification where the job opening is located. The job listing requirements applies to all employment openings with the exception of temporary position of three days or less, positions filled internally, or executive/senior level management positions. It is important for contractors to know that they are responsible for all third party recruitment agencies efforts to comply with the regulations.
OFCCP issued a Final Rule (Code of Federal Regulations [CFR] § 60-300) effective September 7, 2007 which addressed the Affirmative Action Plan (AAP) requirements and mandatory listing requirements for veterans.
The Jobs for Veterans Act (JVA) increased the threshold of coverage of a single contract from $25,000 to $100,000 or more for contracts that are owned or modified on or after December 1, 2003. The AAP content for contracts under the new threshold must contain the following: policy statement, review of personnel process, reasonable accommodation to physical and mental limitations, policy to prevent harassment, external dissemination of policy, internal dissemination policy, audit and reporting system, responsibility for implementation, and training policy. These are the same requirements under CFR § 60-250.
The classification of veterans has changed. The current classifications are: Armed Forces Service Medical Recipient, Disabled Veterans (service connected), Recently Separated Veterans (past 3 years), and Other Protected Veterans. The classification of Vietnam Era Veteran has been elimination. However, it is probable that those falling under this classification will fit within the parameters of at least one of the new classifications. The Newly Separated Veterans has been redefined to include veterans who have separated from service within the past three years rather than the past year as the previous definition stated. Finally, the Disabled Veterans category has been expanded to include all veterans with a service-related disability, regardless of the disability rating.
Several contractors may find themselves with the need to comply with both sections of the CFR. In that case, the contractor can choose to create two AAPs or they may develop a single AAP following CFR § 60-300. Please see Appendix B of the Final Rule for further guidance on how to solicit veteran status.
Changes have also been made to the mandatory job listing requirements. Contractors falling within the contract thresholds must list all job openings with the state workforce agency job bank as well as a local employment service delivery system. Contractors must list in the notification where the job opening is located. The job listing requirements applies to all employment openings with the exception of temporary position of three days or less, positions filled internally, or executive/senior level management positions. It is important for contractors to know that they are responsible for all third party recruitment agencies efforts to comply with the regulations.
Tuesday, February 12, 2008
Defining new OFCCP Barriers Analysis
By Fe Ramos, Sr. Consultant, Biddle Consulting Group
Barriers Analysis
Is it possible that the OFCCP has started to conduct a “barriers analysis?” They can under the law. 41 CFR Part 60-1 ‘Obligation to Solicit Race and Gender Data for Agency Enforcement Purposes; Final Rule,’ released on October 7, 2005 (Use of Labor Force Statistics and Census Data) states: “OFCCP intends to use such data during compliance reviews to determine whether basic qualifications have an adverse impact on the basis of race, ethnicity, or gender. OFCCP does not agree that it should rely exclusively on availability data compiled by contractors…” [emphasis added].
During a recent OFCCP audit, we carefully reviewed the data and the reports contained in the client’s AAP before submittal to the OFCCP (as this has always been a part of Biddle Consulting Group protocol.) Adverse impact analyses of the transaction data was also conducted prior to submittal and the results also did not reveal any potential problem areas. In short, the AAP was considered compliant and without problems so it was expected to pass the compliance evaluation without issue. Needless to say, it came as a surprise when the OFCCP Compliance Officer requested the availability percentages by ethnicity/race for two (2) particular job groups. In light of this additional request, a further review of the data was again conducted and still, no apparent problem with the data was found.
A “barriers analysis,” as the term implies, is a test to determine if the comparison pool (e.g., applicant pool) is composed of what is “reasonably expected.” It determines if there is a “barrier” that prevents reasonably expected females and minorities from applying in an organization. The OFCCP can conduct this type analysis if it has reason to believe that the applicant pool might not be representative of the availability. Statistically significant disparities (i.e., adverse impact) in the hiring rates of females vs. males and/or minorities vs. non-minorities (when hires are compared to applicants) do not have to be present for the OFCCP to conduct a barriers analysis. A suspicion that the applicant pool could be “tainted” is enough.
How to conduct the analysis: The applicant data is compared to availability percentages (e.g., Census data from the organization’s local recruitment areas). If statistically significant disparities are found, it could be argued that the applicant data is “suspect” and therefore, is not an appropriate benchmark to which hires should be compared. This said, the hires data could then be compared to the availability data. If statistically significant disparities are found, adverse impact can be inferred.
Barriers Analysis
Is it possible that the OFCCP has started to conduct a “barriers analysis?” They can under the law. 41 CFR Part 60-1 ‘Obligation to Solicit Race and Gender Data for Agency Enforcement Purposes; Final Rule,’ released on October 7, 2005 (Use of Labor Force Statistics and Census Data) states: “OFCCP intends to use such data during compliance reviews to determine whether basic qualifications have an adverse impact on the basis of race, ethnicity, or gender. OFCCP does not agree that it should rely exclusively on availability data compiled by contractors…” [emphasis added].
During a recent OFCCP audit, we carefully reviewed the data and the reports contained in the client’s AAP before submittal to the OFCCP (as this has always been a part of Biddle Consulting Group protocol.) Adverse impact analyses of the transaction data was also conducted prior to submittal and the results also did not reveal any potential problem areas. In short, the AAP was considered compliant and without problems so it was expected to pass the compliance evaluation without issue. Needless to say, it came as a surprise when the OFCCP Compliance Officer requested the availability percentages by ethnicity/race for two (2) particular job groups. In light of this additional request, a further review of the data was again conducted and still, no apparent problem with the data was found.
A “barriers analysis,” as the term implies, is a test to determine if the comparison pool (e.g., applicant pool) is composed of what is “reasonably expected.” It determines if there is a “barrier” that prevents reasonably expected females and minorities from applying in an organization. The OFCCP can conduct this type analysis if it has reason to believe that the applicant pool might not be representative of the availability. Statistically significant disparities (i.e., adverse impact) in the hiring rates of females vs. males and/or minorities vs. non-minorities (when hires are compared to applicants) do not have to be present for the OFCCP to conduct a barriers analysis. A suspicion that the applicant pool could be “tainted” is enough.
How to conduct the analysis: The applicant data is compared to availability percentages (e.g., Census data from the organization’s local recruitment areas). If statistically significant disparities are found, it could be argued that the applicant data is “suspect” and therefore, is not an appropriate benchmark to which hires should be compared. This said, the hires data could then be compared to the availability data. If statistically significant disparities are found, adverse impact can be inferred.
Thursday, January 31, 2008
OFCCP 2007 Financial Remedies Posted
By Chris Lindholm, Director, Biddle Consulting Group
OFCCP has posted their 2007 revenue figures. Here is the headline:
"OFCCP Once Again Produces Record Financial Remedies for a Record Number of American Workers in FY 07"
With numbers exceeding $50 million in consecutive years, the Federal contracting world should be on notice that OFCCP has discovered a bonanza of low hanging fruit with the contractors they are auditing. As consultants, Biddle Consulting Group is very familiar with OFCCP desk audits and we can tell the public with absolute certainty that the most significant findings for OFCCP are in recordkeeping. Contractors around the country continue to struggle when it comes to managing data associated with the hiring process. Applicant Tracking Systems (ATS) are making an impact but far too few organizations have good protocols in place for tracking applicants from initial interest to hire.
Additionally, OFCCP is continuing their quest to find systemic discrimination in pay within the contractors they are auditing and while recordkeeping may be the biggest payoff for OFCCP right now, interest in pay equity has not waned.
To see the OFCCP announcement click on the link below.
http://www.dol.gov/esa/ofccp/enforc07.pdf
OFCCP has posted their 2007 revenue figures. Here is the headline:
"OFCCP Once Again Produces Record Financial Remedies for a Record Number of American Workers in FY 07"
With numbers exceeding $50 million in consecutive years, the Federal contracting world should be on notice that OFCCP has discovered a bonanza of low hanging fruit with the contractors they are auditing. As consultants, Biddle Consulting Group is very familiar with OFCCP desk audits and we can tell the public with absolute certainty that the most significant findings for OFCCP are in recordkeeping. Contractors around the country continue to struggle when it comes to managing data associated with the hiring process. Applicant Tracking Systems (ATS) are making an impact but far too few organizations have good protocols in place for tracking applicants from initial interest to hire.
Additionally, OFCCP is continuing their quest to find systemic discrimination in pay within the contractors they are auditing and while recordkeeping may be the biggest payoff for OFCCP right now, interest in pay equity has not waned.
To see the OFCCP announcement click on the link below.
http://www.dol.gov/esa/ofccp/enforc07.pdf
Monday, January 28, 2008
Clarifying the Updated EEO-1 Race Requirements
By Shelli Johnson, Analyst, Biddle Consulting Group
The EEOC, in consultation with the OFCCP, has revised the EEO-1 report effective September 2007. This means that the September 2008 EEO – 1 filing and beyond will require the reporting of 7 race categories instead of the previously stipulated 5 race categories. The 7 race categories include Hispanic or Latino, White (Not Hispanic or Latino), Black or African American (Not Hispanic or Latino), Asian (Not Hispanic or Latino), American Indian or Alaska Native (Not Hispanic or Latino), Native Hawaiian or Pacific Islander (Not Hispanic or Latino), and Two or More Races (Not Hispanic or Latino). There is currently no requirement to conduct a costly resurvey of your entire work force. However, employers will need to track these new race categories with their new applicants and hires. Self Identification forms moving forward will need to include a two question component with the first question being “Are you Hispanic or Latino?” If the answer is yes, they do not move on to the following 6 race categories. If the answer is No, they can then complete one of the 6 remaining race categories. The two or more race and Hispanic/Non-Hispanic differentiator was a political decision which does not allow Hispanics to be considered in the two or more race category. BCG suggests resurveying your entire work force by having employees fill out the new self-identification forms at a cost effective time period such as to coincide with yearly performance appraisals or a change in HR systems.
Another common misconception regarding race categories includes the placement of Native South Americans as Hispanic or Latino when in fact they should be categorized as Native Americans.
Interim guidance has been given by the OFCCP as to how to calculate Adverse Impact analyses within affirmative action plans in light of the new race categories, specifically two or more races. The guidance suggests that either the 7-race category system may be used with the two or more race category becoming its own, separate, and indivisible sub group or employers may continue to use the classic 5-race category system. In continuing to use the classic 5-race category system employers would need to collect and retain two separate sets of data. For example, for EEO-1 reporting an employee may identify as two or more races, but when using the 5 race category system a primary race would need to be retained separately for the AAP adverse impact analyses. This development should be watched closely for guidance because of potentially severe financial and political implications.
The EEOC, in consultation with the OFCCP, has revised the EEO-1 report effective September 2007. This means that the September 2008 EEO – 1 filing and beyond will require the reporting of 7 race categories instead of the previously stipulated 5 race categories. The 7 race categories include Hispanic or Latino, White (Not Hispanic or Latino), Black or African American (Not Hispanic or Latino), Asian (Not Hispanic or Latino), American Indian or Alaska Native (Not Hispanic or Latino), Native Hawaiian or Pacific Islander (Not Hispanic or Latino), and Two or More Races (Not Hispanic or Latino). There is currently no requirement to conduct a costly resurvey of your entire work force. However, employers will need to track these new race categories with their new applicants and hires. Self Identification forms moving forward will need to include a two question component with the first question being “Are you Hispanic or Latino?” If the answer is yes, they do not move on to the following 6 race categories. If the answer is No, they can then complete one of the 6 remaining race categories. The two or more race and Hispanic/Non-Hispanic differentiator was a political decision which does not allow Hispanics to be considered in the two or more race category. BCG suggests resurveying your entire work force by having employees fill out the new self-identification forms at a cost effective time period such as to coincide with yearly performance appraisals or a change in HR systems.
Another common misconception regarding race categories includes the placement of Native South Americans as Hispanic or Latino when in fact they should be categorized as Native Americans.
Interim guidance has been given by the OFCCP as to how to calculate Adverse Impact analyses within affirmative action plans in light of the new race categories, specifically two or more races. The guidance suggests that either the 7-race category system may be used with the two or more race category becoming its own, separate, and indivisible sub group or employers may continue to use the classic 5-race category system. In continuing to use the classic 5-race category system employers would need to collect and retain two separate sets of data. For example, for EEO-1 reporting an employee may identify as two or more races, but when using the 5 race category system a primary race would need to be retained separately for the AAP adverse impact analyses. This development should be watched closely for guidance because of potentially severe financial and political implications.
Wednesday, January 16, 2008
Recent Webinars Provided by Biddle Consulting Group
By Shana Larrucea, Consultant, Biddle Consulting Group
BCG’s Series of Free EEO Webinars
In 2007, Biddle Consulting Group (BCG) offered a series of free webinars on timely topics such as the Definition of an Internet Applicant, OFCCP Audit Strategies, Understanding Adverse Impact, and Proper Compensation Analyses. For those of you who were not able to attend the webinars, some highlights of each are listed below.
The OFCCP Audit Process
Adverse Impact Analyses
Current Compensation Practices
Definition of an Internet Applicant
Come to http://www.biddle.com/ to see our schedule of free presentations in 2008.
BCG’s Series of Free EEO Webinars
In 2007, Biddle Consulting Group (BCG) offered a series of free webinars on timely topics such as the Definition of an Internet Applicant, OFCCP Audit Strategies, Understanding Adverse Impact, and Proper Compensation Analyses. For those of you who were not able to attend the webinars, some highlights of each are listed below.
The OFCCP Audit Process
- Before submitting your AAP, repair all inaccurate, wrong, or incomplete data.
- Perform adverse impact analyses on all transactions.
- Perform the OFCCP Red Flag Analysis on compensation.
- Document and emphasize all EEO “Good Things”.
- Prepare a professional and professional-looking AAP.
- Consider performing a pre-audit “mock audit”.
- Ensure all job openings are being registered with state agencies.
- Know your auditor and his/her timeframe for decisions.
- Document all conversations with reviewers.
Adverse Impact Analyses
- Collect and retain all required transaction data (applicants, hires, promotions, terminations).
- Analyze your data regularly throughout the year.
- If impact is discovered, can the data be refined? Is the appropriate analysis being conducted? In which step of the process does the impact occur?
Current Compensation Practices
- Conduct internal proactive analyses with the support of the executive staff and legal team (under Attorney-Client Privilege).
- Missing data can easily undermine the analyses.
- Flip-flops in disparities may mean your organization does not systemically discriminate.
- Statistics are cold and should be supported by anecdotal evidence.
Definition of an Internet Applicant
- Keep good documentation of every aspect of the applicant process.
- Create consistently implemented company selection procedures and/or protocol.
- Create a voluntary self-ID form that encourages applicants to complete upon submittal of application.
- Establish a requisition number for each open position in the organization.
- Track status of each job seeker in the applicant process.
- Create codes to identify decisions and reasons.
Come to http://www.biddle.com/ to see our schedule of free presentations in 2008.
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