The Office of Federal Contract Compliance Programs (OFCCP) in introducing new compliance requirements for construction contractors with the release of the updated Construction Scheduling Letter and Itemized Listing and the reinstatement of Form CC-257. These changes will significantly increase data reporting obligations for federal contractors, especially those in construction, and even certain supply and service contractors that also do construction work.
Reinstatement of Form CC-257
After nearly three decades, OFCCP has brought back Form CC-257 to collect demographic data on federal contractor employees working on construction projects. Contractors will be required to report employee demographics and hours worked on a monthly basis. Preparing this report may not be burdensome for contractors with automated systems; however, it will undoubtedly create a burden for those manually maintaining this data. OFCCP has not yet released an implementation date, but they are expected to provide additional guidance soon.
New Construction Scheduling Letter and Itemized Listing
Effective October 1, 2024, OFCCP has issued an updated Construction Scheduling Letter and Itemized Listing. This new letter applies to federal construction contractors and subcontractors selected for compliance reviews and introduces several significant revisions:
- Data on Selection Procedures: The letter now requires contractors to report on their use of tests and selection procedures, including technology-based systems like artificial intelligence, algorithms, and other automated processes. Contractors must ensure these procedures are validated if any adverse impact is detected.
- Extended Data Requests: Contractors must provide more detailed information, including certified payroll data covering not only trade workers but also non-trade employees involved in supervision, inspection, and other on-site functions. Additionally, new requests for information on layoffs, along with project start and anticipated end dates, are now required.
- Increased Recordkeeping Obligations: Contractors will need to supply records on employee transactions, such as applications, hires, terminations, and promotions, along with more granular data on pay rates, bonuses, and overtime.
- New Monitoring Requirements: Contractors must provide evidence that personnel practices, including seniority systems and job classifications, do not have discriminatory effects.
OutSolve's Take
While OFCCP claims the new Construction Scheduling Letter is designed for more efficient data collection, the increased burden is evident. Contractors must now dedicate more time and resources to ensure they can produce the detailed information requested, and those with both supply and service and construction contracts will face additional compliance challenges. Compliance reviews are likely to require significant preparatory work, especially for those with complex payroll systems or a wide array of projects across geographic areas.
Next Steps for Contractors
- Monitor compliance evaluation notifications and proactively assess data tracking systems. OFCCP may provide a courtesy notification of construction contractors chosen for compliance evaluations.
- Ensure payroll systems are aligned with OFCCP's updated reporting requirements.
- Consider conducting internal audits to identify any areas of concern, particularly around selection procedures and pay equity.
With these new demands, contractors should work closely with OutSolve to avoid potential non-compliance during audits. Contact our consultants with questions or support requests.
Related OutSolve Blogs:
OFCCP Overhauls Construction Contractor Audit Practices and Auditing Schemes
Understanding Recent OFCCP Updates for Government Contractors in Construction