Federal Contractors: Beware of OFCCP’s New Compensation Audit Procedures
Feb. 26, the U.S. Department of Labor’s Office of Federal Contract Compliance
Programs (OFCCP) announced that effective Feb.
28, 2013, there are significant changes in how the OFCCP addresses compensation
in compliance audits and enforcement proceedings. These changes
effectively open virtually every federal contractor’s actions, policies and
practices that affect compensation to scrutiny, review and possible challenge
announced changes include the following:
will formally rescind the “Voluntary Guidelines” and
“Compensation Standards” issued by OFCCP in 2006. OFCCP has criticized
these documents as improperly limiting OFCCP’s ability to conduct full
investigations of compensation matters; and
OFCCP has issued new guidance, effective on Feb. 28, 2013, specifying the
procedures that OFCCP’s investigators will follow to review federal contractors’
systems and practices for paying workers. The guidance is included in the
newly-issued OFCCP Policy Directive 307.
marks a significant change and expansion in OFCCP’s approach to
compensation. As a result, federal contractors can expect a much more
intensive review of all systems and practices relating to compensation during
OFCCP audits that commence on and after Feb. 28. Federal contractors
should undertake immediate steps to ensure that they fully understand the
breadth and scope of these new changes, and to assess the possible impact on
their organization.Editor’s note: This article was provided by the law firm of FortneyScott.
FortneyScott is a Washington, D.C.-based law firm counseling and advising
clients on the full spectrum of workplace-related matters. FortneyScott
is a frequent speaker and sponsor of AGC training events for HR professionals
in the construction industry.
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