Government Contractors: Are you risking your business?

This past month I’ve received several requests for help creating Affirmative Action Plans (AAP). I’ve been glad to get the requests because I can help. But what’s happening here? I’m convinced it’s one of two issues:

  1. The owner didn’t know they needed an AAP, or
  2. The owner believes no one will ever know or check, so why bother.

But folks, here’s the deal… If your business depends on federal government contracting for revenue, and if you are required to have an AAP (there is a threshold to cross first):

You are risking your company if you don’t get this done
and if you don’t update and maintain it each year.

Often this is the first question I get: “What’s the penalty?” The answer is,
there is no monetary fine, but there is a BIG potential penalty. You can be debarred as a federal contractor, in which case you lose any federal contracts and are prohibited from obtaining new federal contracts. And, payments under your existing federal contracts can be frozen. This is the heavy hammer that the enforcing agency, the Office of Federal Contract Compliance Programs (OFCCP), can use on you.

At the very minimum, you will become entangled with the OFCCP as a very burdensome and time-consuming presence in your business affairs. They will pursue enforcement proceedings and they are very likely to require on-site investigation. If their investigation shows a statistical imbalance in your hiring or in your pay, you may then receive an allegation of discrimination which can result in monetary remedies if you cannot rebut those allegations. And you will end up with a conciliation agreement that will require endless time and effort over the following years.

In a 2013 speech, OFCCP Director Pat Shiu, an accomplished civil rights litigator, described OFCCP’s conciliation mission and its sanctions authority:

“Voluntary compliance is always our goal. But in those cases where we find egregious violations of the law and cannot come to a mutually agreeable resolution, we go to court. And we almost always win.

In the courtroom, we not only seek out remedies, but we also ask to debar bad actors from being federal contractors any further. This is a step we rarely take, but it is important to note that debarment is a powerful tool that OFCCP can wield to ensure employers comply with the law.”

In a recent article, the law firm Ogletree Deakins reports on a case in which the OFCCP is actively seeking to disbar a company from future federal contracts and notes that the firm has seen similar tactics in other situations commenting: “This effort is entirely consistent with OFCCP Director Patricia A. Shiu’s repeated statement that ‘[b]eing a federal contractor is a privilege, not a right.’ “

Believe me, you do not want to become entangled in the embrace of the OFCCP. It is far better to invest in being in compliance before they come asking for copies of your documents.

Call me if you think you need an Affirmative Action Plan. I work with companies who are creating their first AAP and the tracking needed for ongoing compliance. More importantly, I work to train you in what you need to track, how to track and analyze the information, and how to become self-sufficient doing this on your own in future years. See my AAP services summary for more information.

Note: Once you’ve received an audit letter from the OFCCP, it’s too late for me
to help you. You need to call your employment lawyer, not your HR consultant.

When employees drive your business success…
We should talk.

Schedule a time for our conversation by
emailing me via the Contact page or calling me at:
804-396-3726
A first phone conversation is free,
with no obligation and completely confidential.
www.RRushtonPaul.com

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