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While receiving news of a government audit is a less than desirable event for any business or individual, the more notice you must prepare and ensure compliance with the law, the better. On September 7, 2018, the U.S. Department of Labor, Office of Federal Contract Compliance Programs (OFCCP) issued 750 Corporate Scheduling Announcement Letters—courtesy notifications issued to federal contractors and subcontractors that have been selected for an Affirmative Action Program (AAP) compliance evaluation.
This recent wave of CSALs are supplementary to the original FY2018 Scheduling List, which was issued this past March. The OFCCP stated that federal contractions and subcontractors that have already received a CSAL, concluded a review, or concluded monitoring pursuant to a consent decree or conciliation agreement within the last five years will not be included in the new supplement.
In addition to providing notification of an upcoming scheduling letter, a CSAL also informs selected establishments of resources and activities for compliance assistance offered by OFCCP. Selected establishments will then receive a subsequent approved scheduling letter from OFCCP’s OMB. Pursuant to an approved scheduling letter, an audit or evaluation will be conducted to ensure that the establishment has created and implemented a compliant AAP, as required.
If you are a federal contractor or subcontractor that is required to create and maintain a written, up-to-date AAP, you might receive a CSAL. If you receive a CSAL, it is imperative that you begin preparing for your compliance evaluation. A CSAL provides a 45-day courtesy notice of actual scheduling letters, however, that is a relatively short period of time for an establishment to conduct an internal audit and confirm its own compliance before an actual evaluation is scheduled by the OFCCP.
Therefore, upon receiving a CSAL, it is prudent to begin conducting an internal audit of compliance with your AAP and federal anti-discrimination laws right away to ensure that any problems uncovered can be corrected or mitigated and necessary policy changes can be implemented before the scheduled evaluation.
If an evaluation reveals that an establishment is not in compliance with federal anti-discrimination laws, the OFCCP will provide the establishment with a period of time to correct the violation. If, however, the establishment fails to remediate and correct the violation, they will be subject to potential consequences including paying restitution (backpay) to victims of discrimination, losing a government contract, and even being barred from entering into a government contract in the future.
To avoid a costly scenario, it is crucial for those potentially subject to an OFCCP evaluation to create and implement a thorough and compliant AAP and diligently monitor its execution.