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Recruiting Compliance 101 Annette Rosta Associate Director, Recruiting Diversity & Compliance

Compliance 101 Training for Recruiters

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Part of the Focus on Compliance Webinar Series: May 1–2, 2013, "Compliance 101 Training for Recruiters" will help you learn more about the federal obligations and a recruiter’s role in helping to ensure the company meets the hiring obligations and maintains their status as a federal contractor.

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Page 1: Compliance 101 Training for Recruiters

Recruiting Compliance 101 Annette Rosta

Associate Director, Recruiting Diversity & Compliance

Page 2: Compliance 101 Training for Recruiters

2 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Background: • Twenty years in recruiting function for employers who are Federal Contactors • Nine years as a recruiter for various industry employers and for all level positions, from Administrative Assistants to Executive Leaders with over 1200 personnel recruited. • Implemented two ATSs and developed Compliance processes from ground up. • Worked through and prepared recruiting documentation for dozens of successful audits/reviews. • Educated recruiters enough about Recruiting Compliance that they now hold other recruiters accountable.

Page 3: Compliance 101 Training for Recruiters

3 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Agenda

Ø What it means to recruit for a Federal Contractor Ø Who are OFCCP and what do they do? Ø What are the expectations of a recruiter when recruiting for a Federal Contractor? Ø What are recruiters’ compliance requirements?

•  Equal Employment Opportunity •  Diversity Outreach •  Record Keeping/Documentation

Ø Recruiter’s role to ensure compliance Ø What are the potential risk to company when compliance expectations are not met? Ø Why else is Recruiting Compliance important? Ø Why is Diversity Recruiting Important for Compliance?

Page 4: Compliance 101 Training for Recruiters

4 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

What are the Qualifications for being a Federal Contractor?

Each non-construction contractor/subcontractor with 50 or more employees is required to develop a written Affirmative Action Program (AAP) for each of its establishments if it:

Has a Federal contract or subcontract of $50,000 or more;

Has government bills of lading which in any 12-month period total, or can reasonably be expected to total, $50,000 or more;

Serves as a depository of Federal funds in any amount; or

Is a financial institution that is an issuing and paying agent for U.S. savings bonds and savings notes in any amount.

Page 5: Compliance 101 Training for Recruiters

5 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Who Monitors the Federal Contractors Employment Practice?

An arm of Department of Labor called: Office

of Federal Contractors Compliance Programs (O F C C P)

Page 6: Compliance 101 Training for Recruiters

6 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

What is the OFCCP?

The OFCCP an arm of the Department of Labor, is responsible for ensuring that contractors doing business with the Federal government does not discriminate and take affirmative action.

Review the Affirmative Action Programs of Federal Suppliers/Contractors

Ensure Contractors comply with EEO Contract clauses.

Investigates impact on Hiring, Promotion, Terminations, and Compensation decisions on Females, Minorities, Veterans, and people with disability.

Page 7: Compliance 101 Training for Recruiters

7 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Colleagues with Compliance Expectations

Hiring

Promotion

Terminations

Compensation

Page 8: Compliance 101 Training for Recruiters

8 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Compliance Expectations of the Recruiter

Use recruiting tools and resources to find the best qualified applicant, including diversity outreach tools and resources for a diversified pool of talent.

Make sure all candidates are treated equally.

Positions have been posted as appropriate.

Process to considering candidates and interviewing applicants is documented and the feedback is available.

Decisions to move forward with individuals are based on assessment of diverse pool of qualified applicants and not on “gut” instinct.

All job file material clearly supports actions of selecting individuals.

Page 9: Compliance 101 Training for Recruiters

9 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

How the OFCCP Monitors Federal Contractors?

Selection is made on which Federal Contactor to Review

Companies and it’s establishment are selected for evaluation from Federal Contractor Selection system.

Scheduling Letter Received - We have an Audit!

This is considered the start of the Compliance Evaluation

Request of AAP and supporting data (Applicant data, Job Group Analysis, Outreach Efforts)

Evaluation Process

Page 10: Compliance 101 Training for Recruiters

10 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

What are the stages of Evaluation Process?

A compliance evaluation consists of any one or any combination of the following three investigative procedures:

■  Desk Audit

■  Off-Site Review

■  Focused Review/On-Site Review

Impact on Recruiter during evaluation process:

■  Request of applicant flow logs or confirmation /clarification of Applicant Data

■  Review of job files and confirmation/clarification of job file material

■  Request for additional outreach efforts made for positions where goals identified for positions

Page 11: Compliance 101 Training for Recruiters

11 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

OFCCP Tasks in Evaluation Process

OFCCP starts with statistics

May move to review other materials for evidence of discrimination, especially where statistical significance is found

May move to review the job file: resumes, job postings, job descriptions, interview notes, etc.

OFCCP looks for connection between positions where there were hires and the applicants for these positions

Hire data during previous AAP year

Applicant data for applicants associated with these hires

Note: Review of Applicant data is a key component of OFCCP audit/investigation

Page 12: Compliance 101 Training for Recruiters

12 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Red Flags the OFCCP is looking for

Applicant to Hire Ratio

OFCCP is looking for many applicants to correspond to each hire

Low ratio can lead to questions … “Going to get Questions!”

■  Did the recruiter not track?

■  Did the recruiter not consider a diverse pool of applicants?

NOTE: Failure to track applicant flow data is a “technical” violation and may lead to allegations of discrimination

Impact Ratio Analysis (IRAs): Representation of Females and Minorities in applicant pool

OFCCP will look for significant discrepancies between “representation” of F/M in applicant pool and availability of F/M in recruitment area

Page 13: Compliance 101 Training for Recruiters

13 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Key Areas the OFCCP Monitors:

Page 14: Compliance 101 Training for Recruiters

14 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Ensure Equal Employment Opportunity

To ensure a company’s establishment provides equal opportunity to be employed, the OFCCP will review:

EEO-1 Analysis

Affirmative Action Programs

Applicant Flow Logs

Recruiter’s role to assist with the analysis of Equal Employment Opportunity:

■  Ensuring as an organization the applicant to hire ratio is adequate to assist in illustrating that the company is considering a diverse applicant pool

■  Ensuring the Applicant Flow Logs data is accurate and consistent with job file and new hire record data

■  Ensuring the Applicant Flow Logs captures all applicants

Page 15: Compliance 101 Training for Recruiters

15 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Outreach Effort and Recruitment

What outreach efforts can we demonstrate to recruit individuals in those groups where we have a goal?

Job Posting - Do we make our opportunities available to all individuals, including to state and local employment agencies?

What events or organizations do we participate in to reach out to individuals with diverse backgrounds?

What has the recruiter done specifically to attract a diverse talent pool?

Page 16: Compliance 101 Training for Recruiters

16 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Why we should outreach and encourage diverse workforce? Government Requirement: as a recruiter for Federal Contractor it is part of our daily responsibilities.

Company Responsibility: An increase in productivity, performance, teamwork, ability to attract and retain top talent, improve morale, and align with company values

An increase in the company’s ability to understand and appeal to an increasingly diverse marketplace

An improvement in overall organizational effectiveness and because our clients expect to work with other employers who encourage a diverse workplace

Diverse teams make better decisions than homogeneous ones, are more creative, and handle complex challenges more effectively. Yet when organizations manage diversity-related conflicts poorly, talented performers flee in search of more welcoming environments.

We need diversity of thought in the world to face the new challenges. –Tim Berners-Lee

Page 17: Compliance 101 Training for Recruiters

17 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Record Keeping/Documentation

Why Records are important • Documents the Selection Process • Supports Decisions • Enables Self-Monitoring

Failure to Keep Records • Constitutes noncompliance • May allow a presumption of discrimination or negative inference Note: OFCCP said “electronic records are easier for auditors”

Page 18: Compliance 101 Training for Recruiters

18 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Applicant Records and Job File Materials

Job Files should be retained for all positions a search was conducted and either filled internally or externally – cancelled or filled.

All Job Files (electronic/hard copy) should contain all accurate and complete data relevant to the requisition, the new hire, and all applicants considered for the position.

OFCCP Rule…Lack of documentation leads to unfavorably conclude the employer has done wrong and is potentially with holding information, or knowingly did not keep appropriate records.

Page 19: Compliance 101 Training for Recruiters

19 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

ü Job Responsibilities and Basic Qualifications

ü Resume of each candidate considered

ü Evidence of posting to State Workforce Agency

ü Employment Application (or documentation of effort to obtain)

ü Evidence of all advertisements, (job board posting and print):

ü Opportunity to self identify through the Affirmative Action Survey on Gender and Race/Ethnicity

ü Evidence of Good Faith/Diversity Outreach Efforts

ü Interview Evaluation Feedback on all applicants by all interviewers

ü Evidence of Internal and External Search and any DMTs used to search

ü Reason for Rejection on applicants who don’t receive an offer

ü Documentation of all external recruitment sources used

ü Copy of all Offer Letters sent

This checklist helps to ensure all job file materials are available for quick reference and submittal upon request.

EEO Job File Checklist:

Page 20: Compliance 101 Training for Recruiters

20 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Record Keeping Guidelines

Posting Data/Job Description External Postings - All regular positions where an external candidate is going to be considered must be posted to the State Workforce Agency. This is an absolute requirement.

–  Basic Qualifications ■  Must be Objective

■  Must be non-comparative features of a job seeker ■  Must be job-related

Good Faith Outreach Efforts – Any outreach efforts made to recruit

Additional postings/advertisements - Any postings to industry, niche, major job board and/or any print advertisements Any external resources used – Documentation of any external resources for example Contingency Search or Retained Search firm.

Page 21: Compliance 101 Training for Recruiters

21 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Record Keeping Guidelines, Continued Searching Data – internal/external searches Internal and External Searches - contractor must maintain a record of: Specific position for which each search was made The substantive search criteria used in the search Date of the search Each resume considered as a result of search Data Management Technique - If there are a large number of expressions of interest, a contractor may use data management techniques to reduce the number considered.

Page 22: Compliance 101 Training for Recruiters

22 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Record Keeping Guidelines, continued

Applicant Data Resume – of all internal and external candidates Employment Application – provide all applicants opportunity to complete Interview Evaluation Feedback – feedback must be completed by each interviewer for each applicant, including the recruiter and each member of the hiring team who met with each applicant. Rejection Reason – For every applicant not selected to move forward and be made an offer, there must be a documented reason why they were rejected. Offer Letters Sent – Must retain all offer letters sent to any applicant, including those who decline the offer.

Page 23: Compliance 101 Training for Recruiters

23 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Why else do we collect AFLs/Applicant Data and Diversity Initiatives?

AFLs and Diversity Initiatives are also used for:

■  Federal Audits

■  State and Local Audits

■  Affirmative Action Program

■  RFPs

■  Litigation Matters

■  “Best X List”

■  Recruiting Organization Business Decisions

Page 24: Compliance 101 Training for Recruiters

24 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

What are the possible outcomes of and audit?

Closure Letter – Letter of Compliance - Good Closure Letter with Minor Violations or Notice of Violation – Minor violations (such as record keeping violations). - Bad

Conciliation Agreement – Signed agreement to be monitored more closely and rectify all sited violations. Ugly

Debarment – lose ability to retain the government as a client. Worst Case Scenario

Page 25: Compliance 101 Training for Recruiters

25 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Closure Letters

The Good – Letter of Compliance:

■  Opportunity to self monitor and identify areas of self improvement

■  We know being Compliance Smart is being business savvy – It’s not just about mitigating risk, but about doing the Right thing in the Right way.

The Bad – Letter with Minor Violations or Notice of Violation:

■  Found to be noncompliant, but while no formal written signed agreement , the OFCCP may make recommendations on areas to improve or correct.

Page 26: Compliance 101 Training for Recruiters

26 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

The Ugly – The Conciliation Agreement

What is a Conciliation Agreement and the potential outcomes of having one? Significant alleged violations found such as discrimination, failure to engage in good faith Affirmative Action effort or Major Record Keeping violations. A settlement agreement which the federal contractor would sign off on with OFCCP’s proposed remedies for correcting violations.

Potential Outcomes of a Conciliation Agreement: ■  Loss of Federal Contracts ■  Public Humiliation ■  Loss of current and future clients and employees because we lack integrity ■  Pay out to applicants who were potentially discriminated against ■  Financial Remedies ■  Revamp of all employment policies/practices and training

Page 27: Compliance 101 Training for Recruiters

27 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Worst Case Scenario Outcome

Debarment Ban from Current/Future Client Contracts

Treatment: The Federal Contractor and its officers, agents, successors, divisions and subsidiaries are ineligible for the award of any contract or subcontract funded, in whole, or part, with funds from any agency, or for the extension or other modification of existing contracts or subcontracts.

Debarment is for an indefinite period of time pending the Federal Contractors compliance with OFCCP regulations, or for a fixed period of not less than six months. Therefore, the termination date will be listed as the ending date of such as a fixed period, or as "Indefinite" (Indef.)

Organizations that have faced debarment can be found on the Excluded Parties Listing System link based off the OFCCP Home web site.

Page 28: Compliance 101 Training for Recruiters

28 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Personal Impact of Conciliation Agreement

What this means for Leadership and the Recruiter? Company’s Consequences – Leadership would have to sign agreement to submit reports to OFCCP on established time basis. Basically, signs agreement that they will be responsible for the outcome of all investigations, analysis of reports, and data collected on applicants and employees. Recruiter’s Consequences –

• Poor reflection on you • Responsible for providing complete documentation on each step of each applicant of each search in the selection process • Pressure of continuous scrutiny from OFCCP, Leadership, HR EEO Group

Page 29: Compliance 101 Training for Recruiters

29 © 2012 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Why do we need to know compliance?

To maintain status of a federal contractor

To avoid being part of discrimination statistics and litigation settlements

To help ensure our business clients are making the best staffing decisions

To mitigate any risk concerning discrimination to your company

To articulate transactions when asked by HR or Compliance Officer

To understand our social obligations to all individuals

Audit process will be more intense going forward, best to be ready

Page 30: Compliance 101 Training for Recruiters

QUESTIONS?