News & Announcements

Federal Contractors - More New OFCCP Directives

Posted Tuesday, October 9, 2018 6:25 am

In the past 2 months, the Office of Federal Contract Compliance Programs (OFCCP) has issued 7 new directives.  The number of directives issued this year (9 so far) is significantly more than have been issued in the past 5 years combined.  The purpose of these directives is to provide guidance to OFCCP staff and federal contractors on enforcing and complying with affirmative action regulations – Executive Order 11246 (minorities and women), Section 503 of the Rehabilitation Act (individuals with disabilities), and the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA, protected veterans).

Note that a directive does not change the laws or regulations and it does not establish any legally enforceable rights or obligations.  Directives do, however, provide guidance and insight into how OFCCP will conduct reviews.

Religious ExemptionsDirective 2018-03 concerns religious exemptions for contractors that are religious organizations.  It directs OFCCP staff to keep in mind recent U.S. Supreme Court cases and Executive Orders, which reiterate the government’s duty to protect religious freedom.  The Directive did not specify what this means other than to quote some of the cases and orders:

  • “[G]overnment must permit individuals and organizations, in all but the most narrow circumstances, to participate in a government program ‘without having to disavow their religious character[.]’” (quoting Trinity Lutheran Church of Columbia, Inc. v. Comer, 137 S. Ct. 2012, 2022 (2017)) (brackets omitted).
  • OFCCP staff “cannot condition the availability of opportunities upon a recipient’s willingness to surrender his or her religiously impelled status.” (quoting Trinity Lutheran, 137 S. Ct. at 2022) (quotation marks and brackets omitted).

Focused ReviewsDirective 2018-04 directs that starting in Fiscal Year 2019, which began on October 1, 2018, a portion of organizations scheduled for review will include focused reviews.  In a focused review, OFCCP will go onsite and conduct a comprehensive review solely focused on compliance with one of the three regulations mentioned above.  For example, in a Section 503 focused review, the OFCCP compliance officer would only review policies and practices related to Section 503 compliance, including interviewing managers responsible for Section 503 compliance as well as employees affected by those policies.

The Directive did not provide details on what percentage of reviews will be focused or how contractors will be selected for such reviews.  OFCCP, however, directed its staff to develop protocols for conducting focused reviews, to be made available in FAQs prior to the issuance of the next scheduling list.  OFCCP will also develop contractor education and compliance assistance to provide guidance for this new form of review.

Compensation PracticesDirective 2018-05 rescinds Directive 2013-03 and outlines OFCCP’s procedures for reviewing contractor compensation practices.  The 8-page Directive discusses:

  • Program priorities;
  • Use of statistical and anecdotal evidence;
  • OFCCP’s procedures for requesting data and review;
  • Development and use of pay analysis groupings of comparable employees;
  • Principals OFCCP applies to its statistical analysis of compensation data;
  • Control variables used by OFCCP; and
  • OFCCP’s process for providing contractors with information regarding its findings.

OFCCP issued FAQs regarding this Directive.

Contractor Recognition ProgramDirective 2018-06 introduces:

  • A contractor recognition program that recognizes high-quality and high-performing compliance programs and initiatives as model contractor practices;
  • A contractor mentoring program; and
  • Other initiatives that provide contractors opportunities to collaborate and provide feedback to OFCCP.

Contractor Verification ProcessDirective 2018-07 advises that OFCCP will develop a verification process to ensure all covered federal contractors are meeting their obligations to prepare a written affirmative action program (AAP) and update it annually.  This includes:

  • Contractors annually certifying compliance with AAP requirements;
  • Increasing the likelihood of compliance reviews for contractors that have not certified compliance with the AAP requirements;
  • Compliance checks to verify contractor compliance;
  • If a contractor seeks an extension to respond to a scheduling letter, the contractor must produce the AAP; and
  • Development of information technology to collect and facilitate review of AAPs.

The OFCCP plans to prepare a public outreach and education campaign on this initiative.

OFCCP Policies and ProceduresDirective 2018-08 implements policies and procedures for OFCCP staff to increase transparency pertaining to:

  • Scheduling,
  • Pre-Desk Audit,
  • Desk Audit,
  • Pre-Onsite,
  • Offsite Analysis, and
  • OFCCP Conciliation Efforts.

Ombud ServiceDirective 2018-09, in an effort to increase transparency, initiates an impartial Ombud Service to:

  • Facilitate resolution of concerns raised by contractors, industry groups, and other external stakeholders;
  • Conduct independent inquiries into issues related to the administration of the OFCCP program; and
  • Propose internal recommendation to improve the quality of OFCCP services.
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