Legal Affirmative Action

The utilization analysis requires careful attention. To determine whether a contractor is complying with its affirmative action obligations, the contractor must identify those areas in its workforce in which minorities and women are being underutilized. The utilization analysis is composed of four main parts: the identification of job groups within the facility (job groups are comprised of positions with similar skills and responsibilities), a workforce analysis (i.e., identifying the racial/ethnic and gender makeup of the contractor’s current and past workforce and applicants), a labor market analysis (information about the number of women and other protected classes available in the labor market to fill each job category), and an underutilization analysis (a comparison of personnel available with current workforce). To accomplish this analysis, the contractor must study the applicant flow, recruitment procedures, selection and placement procedures, promotion and transfers, seniority systems, terminations, employee benefits, and working conditions. Because this analysis is complex, good record keeping is critical.

Proper record keeping is vital for compliance. To prepare a utilization analysis, the contractor must maintain sufficient records of the race/ethnicity and gender of its applicants, which job positions they applied for, who ultimately
obtained the position (as well as that person’s race/ethnicity and gender), that person’s pay, any promotions and transfers, and when and why such person was terminated. In addition, the OFCCP requires that contractors be able to reproduce both the criteria used to fill their available job positions and the results obtained from the applicant search. For example, the company should make sure to keep copies of all job postings (ideally containing the qualifications for the positions) and all resumes and demographic data for all applicants for each job position.

Beware: new regulations regarding the definition of “applicant.” If maintaining proper records is not difficult enough, new federal regulations have expanded the definition of “applicant.” Because of the ever-increasing use of the Internet by employers to post job openings, the OFCCP now requires federal contractors to maintain demographic data of “Internet Applicants.” In short, the new regulations defines “Internet Applicant” as any individual who satisfies all of the following criteria: the individual submits an “expression of interest” in employment through the Internet (for example, submits a resume to third-party resume databases, such as Monster.com), the contractor considers the individual for employment in a particular position, the individual’s expression of interest indicates he or she possesses the basic qualifications for the position, and the individual does not remove himself/herself from consideration prior to the job offer. Companies are not required to consider every expression of interest they receive over the Internet but can develop consistent policies and procedures for limiting consideration (such as setting resume cut-off dates or limiting the consideration pool to a predetermined number of resumes).

Because preparing affirmative action plans is complicated and technical, it is critical that employers seek legal advice to ensure compliance with all applicable federal (or state) affirmative action laws.