Equal Employment Opportunity:

Strengthening Oversight Could Improve Federal Contractor Nondiscrimination Compliance

GAO-16-750: Published: Sep 22, 2016. Publicly Released: Sep 22, 2016.

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What GAO Found

Since 2010, most compliance evaluations conducted by the Department of Labor's (DOL) Office of Federal Contract Compliance Programs (OFCCP) of federal supply and service contractors identified no violations; however, the methods used may not focus evaluations on contractors posing the greatest risk. OFCCP relies on compliance evaluations to detect equal employment violations by federal contractors and conducts evaluations for about 2 percent of federal contractor establishments annually. Since 2010, about 78 percent of evaluations found no violations and about 2 percent had discrimination findings (see figure). However, when it selects contractors for evaluations, OFCCP does not use a generalizable sample that would allow for conclusions about the federal contractor population. Therefore, it does not have reasonable assurance that it is focusing its compliance efforts on those contractors with the greatest risk of noncompliance. During evaluations, OFCCP requested and reviewed documents related to contractors' equal employment efforts, including their Affirmative Action Program (AAP), which outlines contractors' compliance efforts. In 2015, close to 85 percent of evaluated contractor establishments did not submit their AAP within 30 days of OFCCP's request and were granted extensions in some cases. This suggests that OFCCP processes do not ensure that all contractors are complying with their obligation to complete and annually update an AAP.

Figure: Findings of Federal Contractor Nondiscrimination Compliance Evaluations From Fiscal Years 2010-2015

Fig HL-5 v05_131357

Since 2012, OFCCP's outreach and compliance assistance activities to assist contractors and other stakeholders, such as protected workers and industry groups, have declined as the agency refocused its activities on enforcement, and some stakeholders said guidance could be clearer. Outreach activities, such as community group presentations and job fair participation, decreased more than 80 percent from 2012 to 2014. Some stakeholders told GAO that workers, applicants, and contractors may benefit from more outreach activities. OFCCP's compliance assistance activities, such as seminars, for contractors—are down 30 percent since 2012. Many contractors told GAO they do not feel comfortable contacting OFCCP for assistance and hire third party support to help comply with federal nondiscrimination and affirmative action requirements. While contractors generally found OFCCP guidance helpful, both stakeholders and contractors said the guidance could be clearer to help them understand the requirements. Without clear guidance, contractors may not be able to understand their equal employment obligations.

Why GAO Did This Study

OFCCP is charged with ensuring that about 200,000 federal contractor establishments refrain from discrimination and take affirmative action to provide equal employment opportunities for certain protected classes of workers. GAO was asked to review OFCCP practices.

In this report, GAO (1) assessed how OFCCP conducts supply and service compliance evaluations, including the methodology, resources, and results, and (2) evaluated OFCCP outreach, assistance, and guidance efforts to assist contractors in complying with the requirements it enforces. GAO analyzed both OFCCP Information System data and a nongeneralizable sample of 43 case files and reviewed relevant federal laws, executive orders, regulations, guidance, and agency documents. GAO also interviewed a nongeneralizable sample of 24 contractors with and without experience with a compliance evaluation; managers and staff in OFCCP's headquarters and all six regional offices; and representatives of national organizations representing contractors and protected workers' interests.

What GAO Recommends

GAO is making six recommendations to DOL, including that OFCCP develop a contractor selection process that reflects contractor noncompliance risk, develop a mechanism to monitor contractors' compliance with AAP requirements, and review and assess the clarity of its contractor guidance. DOL agreed with GAO's recommendations.

For more information, contact Cindy Brown Barnes at (202) 512-7215 or brownbarnesc@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Comments: The Department of Labor (DOL) agreed with this recommendation and is taking steps to address it. DOL noted its past work to improve its ability to identify federal contractor establishments under its jurisdiction. The agency is also committed to improving the scheduling process and using its resources more efficiently. DOL noted that its recently proposed EEO-1 pay data collection will provide more detailed information on federal contractor compensation disparity patterns, which they believe will strengthen the selection process. Finally, the agency reported that it is committed to improving its ability to focus on contractors with the greatest risk of noncompliance.

    Recommendation: To ensure that federal contractors are complying with equal employment opportunity requirements, the Secretary of Labor should direct the Director of OFCCP to make changes to the contractor scheduling list development process so that compliance efforts focus on those contractors with the greatest risk of not following equal employment opportunity and affirmative action requirements.

    Agency Affected: Department of Labor

  2. Status: Open

    Comments: The Department of Labor agreed with this recommendation and reported that it will fully explore the operational implications and funding requirements.

    Recommendation: To ensure that federal contractors are complying with equal employment opportunity requirements, the Secretary of Labor should direct the Director of OFCCP to develop a mechanism to monitor AAPs from covered federal contractors on a regular basis. Such a mechanism could include electronically collecting AAPs and contractor certification of annual updates.

    Agency Affected: Department of Labor

  3. Status: Open

    Comments: The Department of Labor (DOL) agreed with this recommendation. DOL reported that it will explore the logistics of non-geographically based compliance evaluations in its review of contractors with Functional Affirmative Action Programs. The agency will also explore establishment based cross-regional case transfers, and continue to implement improved case distribution approaches in future scheduling lists.

    Recommendation: To ensure that federal contractors are complying with equal employment opportunity requirements, the Secretary of Labor should direct the Director of OFCCP to make changes to the current scheduling list distribution process so that it addresses changes in human capital and does not rely exclusively on geographic location.

    Agency Affected: Department of Labor

  4. Status: Open

    Comments: The Department of Labor agreed with this recommendation and noted past and future efforts to address it. To date, the agency has conducted many webinars to build staff knowledge and skills; implemented a Front Line Manager Leadership Development Program to enhance leadership and technical skills; hosted an all-staff regional training in FY16 to hone the staff's technical skills; developed a training plan in FY16 to assess employee training needs and address the needs of compliance officers at various stages of their careers; and conducted a training needs assessment in FY16 to identify the performance requirements and competencies needed by agency staff. Based on the results of the needs assessment, the agency plans to develop the "Compliance Officer Continuous Education Success Program," a three-year program to ensure that compliance officers receive timely and consistent instruction. They will also formalize its use of training-related work groups to ensure training is responsive to employer needs, and leverage different instructional methods, such as classroom and web-based training.

    Recommendation: To ensure that federal contractors are complying with equal employment opportunity requirements, the Secretary of Labor should direct the Director of OFCCP to provide timely and uniform training to new staff, as well as provide continuing training opportunities to assist compliance officers in maintaining a level of competence to help ensure quality and consistency of evaluations across regions and district offices.

    Agency Affected: Department of Labor

  5. Status: Open

    Comments: The Department of Labor (DOL) agreed with this recommendation and is taking steps to address it. The agency plans to expand stakeholder engagement practices, such as consultations with federal contractors, to determine what additional guidance is needed to support contractor compliance with OFCCP regulations and increase contractor awareness of resources, such as its Help Desk and EEO Tabulation. OFCCP will also build on prior outreach that has included live and virtual events (e.g., focus groups, round tables) and explore ways to disseminate promising practices.

    Recommendation: To ensure that federal contractors are complying with equal employment opportunity requirements, the Secretary of Labor should direct the Director of OFCCP to review outreach and compliance assistance efforts and identify options for improving information provided to federal contractors and workers to enhance their understanding of nondiscrimination and affirmative action requirements to ensure equal employment opportunities for protected workers.

    Agency Affected: Department of Labor

  6. Status: Open

    Comments: The Department of Labor agreed with this recommendation. The agency noted past efforts demonstrating its commitment to quality guidance, such as by increasing online resources and tools available to stakeholders, and revising outdated regulations and guidance with input from stakeholders.

    Recommendation: To ensure that federal contractors are complying with equal employment opportunity requirements, the Secretary of Labor should direct the Director of OFCCP to assess existing contractor guidance for clarity to ensure that contractors have information that helps them better understand their responsibilities regarding nondiscrimination and affirmative action requirements to ensure equal employment opportunities for protected workers.

    Agency Affected: Department of Labor

 

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