The Office of Federal Contract Compliance Programs (“OFCCP”) recently announced the establishment of VERP, which stands for Voluntary Enterprise-wide Review Program. Contractors accepted into VERP will be removed from the pool of contractors scheduled for compliance evaluations for up to five years. Directive 2019-04 sets forth the framework by which OFCCP will develop and implement the program.
What is VERP?
VERP recognizes high-performing contractors that have comprehensive, corporate-wide inclusion and compliance programs. OFCCP believes this new program will provide “meaningful cost‐saving compliance incentives to federal contractor participants, and recognizes that some contractors excel in their corporate‐wide compliance with OFCCP’s requirements.”
Application Process
Contractors can apply for the program beginning in fiscal year 2020. As part of the application process, OFCCP will conduct compliance reviews of the contractor’s headquarters location as well as a sample or subset of establishments. Contractors must demonstrate that they meet established criteria, including a demonstrated commitment to and application of successful equal employment opportunity programs on a corporate‐wide basis.
Program applicants who do not qualify for the program will return to the pool of contractors that OFCCP may schedule for compliance evaluations through OFCCP’s neutral selection process. OFCCP will not automatically place rejected applicants on a scheduling list.
How it Works
The program will have two tiers of contractors. The top tier will include top‐performing contractors with corporate‐wide model diversity and inclusion programs. Top-tier contractors can remain in the program for a period of five years at which point they will be re‐evaluated to stay in the program.
The second tier will consist of OFCCP-compliant contractors that will receive individualized compliance assistance to become top performers. Contractors qualifying for the second tier can remain in the program for three years and will receive individualized compliance assistance to progress to the top tier.
To remain in VERP, OFCCP will expect contractors to maintain a workforce free of discrimination or other material violations, and provide periodic reports and information to OFCCP through which OFCCP can confirm these efforts. OFCCP would still retain the right to conduct individual and/or third-party complaint investigations.