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Highlights of OFCCP's Webinar on Goals and Benchmarks

Summary of Article. On March 6, 2014, the U. S. Department of Labor's ("DOL") Office of Federal Contract Compliance Programs ("OFCCP") conducted the fifth and last of its "Moving Toward Compliance" series of webinars. These sessions are being presented to assist Federal contractors in complying with the new agency regulations that become effective on March 24, 2014. The March 6 webinar, entitled "Goals and Benchmarks" provided information regarding the requirements for goals required under the new Section 503 of the Rehabilitation Act of 1973 ("Section 503") regulations and the requirement for benchmarks under the new Vietnam Era Veterans' Readjustment Assistance Act of 1974 ("VEVRAA") regulations. Both the webinar and the slides will be posted on the agency's website at www.dol.ofccp.gov.

The objectives of the webinar were to enable Federal contractors to: 1) understand the purpose of the 7% national utilization goal under Section 503 and hiring benchmarks under VEVRAA; 2) properly establish VEVRAA benchmarks using one of two methods; 3) properly apply the Section 503 utilization goals and the VEVRAA hiring benchmark; and 4) take appropriate action if the goal or benchmark is not met.

Highlights of the Goals and Benchmarks Webinar. The webinar was conducted by Leo Lestino, OFCCP Regulatory Analyst; Ebony Ross, OFCCP Equal Opportunity Specialist; Naomi Levin, OFCCP Branch Chief of Policy; Suzan Chastain, Counsel, Office of the Solicitor; and Keir Bickerstaffe, Senior Attorney, Office of the Solicitor.

A summary of the highlights of this webinar are as follows:

General information.

o Contractors will not be considered to be in violation of either the new Section 503 or VEVRAA regulation solely for failing to meet, respectively, the Section 503 goals or the VEVRAA benchmarks.

o Contractors are to count disabled veterans as both individuals with disabilities under Section 503 and protected veterans under VEVRAA.

o Contractors are not to start the new Section 503 and VEVRAA self-identification procedures prior to March 24, 2014; they are required to start using these new procedures when they start their first AAP after March 24, 2014 (the "Transitional AAP").

o The webinar and its slides included numerous resources to assist both individuals and contractors regarding the hiring of individuals with disabilities and protected veterans.

New Section 503 Regulations.

o Contractors with over 100 employees company-wide must apply the 7% Section 503 goal to the same job groups they use in their Executive Order AAP. However, the presenters mentioned the Executive Order regulation which provides that contractors with fewer than 150 employees company-wide may use the EEO-1 job categories for their job groups.

o The OFCCP does not consider it necessarily to be automatic that there is a problem area just because a contractor did not meet the 7% goal for a job group. However, the failure to meet the goal in a job group can be considered to be a signal that there may be a problem area.

o In response to the question regarding what strategies contractors can use so that applicants and employees self identify as individuals with disabilities, the OFCCP presenters said "if you build it they will come," meaning that contractors who create policies and practices to show that they want to hire individuals with disabilities will make it comfortable for people to self identify.

o The 80% rule allowed in the Executive Order is inapplicable to the 7% Section 504 goal. If there is any percentage under 7% then the goal has not been met.

New VEVRAA Regulations.

o The OFCCP presenters said that they have not yet posted on their website, as they are required to do under the new VEVRAA regulations, the data required in Factor One (the average percentage of veterans in the civilian labor force in the State[s] where the contractor is located over the preceding three years) and Factor Two (the number of veterans over the previous four quarters, who were participants in the employment service delivery system in the State where the contractor is located) of the second VEVRAA benchmark method. However, the agency will let contractors know when they publish it.

o Regarding the second method of creating benchmarks, contractors do not have to assign numerical values to how they assign weight to each of the five factors; they only have to explain how they use each factor and articulate why one factor is more significant than another.

o Unlike the new Section 503 regulations regarding goals, the new VEVRAA regulations do not obligate the contractors to take any action based on their failure to meet a benchmark. Although contractors do not have to identify problem areas, they are expected to document why they did not reach a benchmark as part of their outreach and recruitment assessment.

o Contractors who fail to meet the VEVRAA benchmark with one method (for example, the national goal) are not required to use the method they did not use (in this example, the five-factor method).

Information from the Goals and Benchmarks Webinar.


Section 503 Utilization Goal (41 CFR 60-741.46).


o Preliminary information. In this new requirement, the OFCCP has set a 7% national utilization goal that measures the representation of individuals in the contractor's workforce which should be attainable by complying with all aspects of affirmative action requirements. Contractors must take steps to evaluate this goal annually at the start of the next AAP cycle after March 24, 2014. ****


o Preliminary Information; Section 503 7% National Utilization Goal. The agency has created this goal as a "yardstick" for contractors to measure the percentage of individuals with disabilities in their workforce. This goal is neither a rigid quota, as quotas are forbidden, nor a ceiling. ****


o Applying the 7% Utilization Goal. This goal must be applied to each job group in the contractor's workforce; except: 1) where contractors have fewer than 150 employees (in that case, the goal may be applied to EEO-1 job categories); or 2) where the contractor has 100 or fewer employees the goal may be applied to the entire workforce. The webinar slides included a Sample Utilization Table.****


o If the goal is not met. If a contractor fails to meet the 7% goal there will be no sanction or fine. However, the contractor must: 1) take steps to determine if and where impediments to equal employment exists, and 2) develop and execute action-oriented programs to correct problem areas. The webinar slides included a Sample Identification of Problem Areas and Action-Oriented Programs chart. The presenters said that just because a contractor failed to meet the goal in every job group does not automatically mean there was a problem, but it is a signal that there may be problem areas. ****


o Successful outreach and recruitment strategies. The webinar included information from the Office of Disability Employment Policy ("ODEP") on business strategies contractors can use to employee people with disabilities. ****

§ The presenters stated that there are three keys to building a talent pipeline: 1) a recruitment plan that establishes and develops strong relationships with new and diverse recruitment sources; 2) an outreach strategy that reflects the contractor's commitment to a workforce that includes qualified employees with disabilities; and 3) meaningful assessment and a willingness to "shift gears" and try something new if a specific strategy isn't working. ****


§ The webinar included information on numerous sources that help with employing individuals with disabilities, such as: 1) public recruitment sources such as the American Job Center Network http://www.servicelocator.org; 2) community and technical colleges; 3) independent living centers; 4) disability, mental health, advocacy and other community-based organizations; and 5) for-profit companies. The presenters also included a number of effective practices contractors could use to hire individuals with disabilities, such as building an inclusive workplace culture by taking steps such as establishing a disability/diversity employee resource group.****

§ The webinar presenters addressed the question regarding strategies contractors can use for employees and applicants to self identify. They said that "if you build it they will come," meaning that if contractors create policies and practices to show that they want individuals with disabilities in their workplace that people will feel comfortable in self identifying. ****

VEVRAA Hiring Benchmarks (41 CFR 60-300.45[a]).


o The Purpose of the Hiring Benchmark. A hiring benchmark creates a quantifiable method (i.e. yardstick) by which the contractor can measure its progress toward achieving EEO for protected veterans. The benchmark may be used as a tool for assessing the contractor's outreach and recruitment efforts. Contractors will not be subject to an enforcement action or found to be in violation of the regulations for failing to meet the benchmark.****

o Establishing the Hiring Benchmark (41 CFR 60-300.45[b]). There are two methods allowed by the new VEVRAA regulations for contractors to establish the hiring benchmark: ****

§ Method 1: Adopting the national percentage of veterans in the civilian labor force (currently 8%), which will be published and updated annually on the OFCCP website. This is the simpler method.****


§ Method 2: Establishing a benchmark by taking into account five factors set forth in 41 CFR 60-300.45(b)(2). ****


o Method 2: The Five-Factor Approach. The webinar presenters stated that the information on the first two factors, required to be posted on the OFCCP's website, have not yet been posted. The agency will notify contractors when this information has been posted. The five factors are the following:****


§ Factor 1: The average percentage of veterans in the civilian labor force in the State(s) where the contractor is located over the preceding three years;

§ Factor 2: The number of veterans over the previous four quarters, who were participants in the employment service delivery system in the State where the contractor is located;


§ Factor 3: The applicant ratio and hiring ratio for the previous year, based on the data collected pursuant to 60-300.44(k);


§ Factor 4:****The contractor's recent assessments of the effectiveness of its outreach and recruitment efforts; and


§ Factor 5: Other factors which would tend to affect the availability of qualified protected veterans.****


* The webinar slides include a number of sample five-factor approach charts. The presenters said contractors who use the five-factor approach can change the methodology for the next year's AAP as long as they can show that they considered the factors and methodology. There is no requirement that contractors assign numerical values and weight to each factor. Rather, contractors are to explain the significance of each factor and explain why one factor is more significant that another.

* Application of the Benchmark. The benchmark should be applied to the contractor's hiring in the current AAP year by establishment. The presenters reiterated that there is no violation for failing to meet the benchmark. They also stated that under VEVRAA contractors are not obligated to do anything based on a failure to meet a benchmark similar to the actions they are required to take for not meeting the Section 503 goal in identifying problem area. Contractors, however, must conduct outreach and recruitment, and as part of the outreach assessment they are expected to document why they did not meet their benchmark.

* Outreach and recruitment resources. The webinar slides included numerous resources for both contractor and veterans to assist in the hiring process for veterans.

Question-and-answer session. During the question and answer session of the webinar, the presenters provided the following information:

* Contractors are to retain requests for accommodations for two or three years, depending on the type of record, and to provide that information to the OFCCP during an audit or investigation.

* Contractors are not to collect the new Section 503 and VEVRAA self-identification data prior to March 24, 2014.

* Contractors with a total workforce of 150 or fewer employees may use the EEO-1 categories as their Section 503 job group categories, as allowed for Executive Order 11246 AAPs.

* Contractors are not allowed to use the Executive Order 11246 80 % rule for Section 503 analyses. Instead, if the 7% goal is not met then the contractor needs to determine whether and where impediments to hiring individuals with disabilities exist.

* Contractors are not allowed to determine that an employee or applicant is an individual with a disability by guessing. For example, employers are not to guess that a person has a "hidden" disability such as diabetes or mental illness. In order to determine that a person who has not self-identified is an individual with a disability under Section 503, the employer cannot make assumptions, and can only make that determination with actual knowledge.

* Contractors who do not meet the VEVRAA benchmark by using one method are not required to use the other method for the next year, although contractors are free to decide to use a different method the following year.

* Disabled veterans are counted in two categories: individuals with disabilities and protected veterans.

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