Affirmative Action Planning Methodology 101 Part I...Words to Know AAP – Affirmative Action Plan EEO – Equal Employment Opportunity Federal Contractor – Has a contract with the

Affirmative Action Planning Methodology 101

Part I

A presentation of the

BCG Institute for Workforce Development (BCGi) October 14, 2011

The following presentation is Copyrighted by Biddle Consulting Group, Inc.

Dao Vang Esmeralda Bermudez

EEO/AA Analyst II EEO/AA Analyst I

[email protected] [email protected]

Biddle Consulting Group, Inc. Biddle Consulting Group, Inc.

193 Blue Ravine, Ste. 270 193 Blue Ravine, Ste.270

Folsom, CA 95630 Folsom, CA 95630

1-800-999-0438 ext. 153 1-800-999-0438 ext. 132

www.biddle.com www.biddle.com

2

Contact Information

mailto:[email protected]

mailto:[email protected]

http://www.biddle.com/

http://www.biddle.com/

Agenda Part I

Words to Know

Who Must Create an Affirmative Action Plan

Requirements of an Affirmative Action Plan

OFCCP and Regulation Update

Questions and Answers

3

Words to Know

AAP – Affirmative Action Plan

EEO – Equal Employment Opportunity

Federal Contractor – Has a contract with the federal government and is subject to EO 11246

Department of Labor (DOL) – Federal governing agency over EEO/Affirmative Action

OFCCP – Office of Federal Contract Compliance Program

EEOC – Equal Employment Opportunity Commission

Establishment – Allocation of employees into an AAP by address

Executive Order (E.O) 11246 – Regulations that require contractors to take affirmative action to

ensure that equal opportunity is provided in all aspects of their employment.

Section 503 of the Rehabilitation Act - prohibits discrimination and requires employers with

federal contracts or subcontracts that exceed $10,000 to take affirmative action to hire, retain, and promote qualified individuals with disabilities.

VEVRAA – Vietnam Era Veterans‟ Readjustment Assistant Act

Audit - OFCCP formal review of a contractor‟s AAP

Incumbents – Employees

Conciliation Agreement (CA) – A contract with the OFCCP that details specific contractor

commitments to resolve violations found in the AAP audit

Notice of Violation (NOV) – A letter from OFCCP identifying potential violations in the AAP as

identified in an audit

SSEG – Similarly Situated Employee Group

4

5 Copyright © Biddle Consulting Group, Inc.

6

History of Affirmative Action

1961 1963 1964 1965 1967 1974

Executive Order No. 10925

Established the President‟s Committee on Equal

Employment Opportunity which later became the EEOC

Vietnam Era Veterans’ Readjustment Assistance

Act of 1974

To take affirmative action to employ and advance in employment veterans

protected by this act and prohibits discrimination

against these veterans


Amended EO 11246 to prohibit discrimination based

on sex as well.

Age Discrimination in Employment Act

Protects individuals who are 40 years

of age or older


Prohibits federal contractors from employment

discrimination based on race, religion, color or national

origin and to take affirmative action

Equal Pay Act Protects gender who perform

substantially equal work in the same establishment from

sex-based wage discrimination

Civil Rights Act – Title VII

Prohibits employment discrimination on the basis of

race, color, religion, sex or national origin

Affirmative Action Timeline

Ref: 41 CFR 60-2.1 (b) (2) 7

Executive Order (E.O.) 11246

Two types of contracts:

1) Supplies and Services

2) Construction

Prime Contractors

• Holds a contract with the Federal Government

• Example: Motor vehicle company supplying cars to the government employees

Subcontractors

• Holds a subcontract with a prime contractor supplying goods and services to a prime contractor

• Example: The company who supplies tires to the motor vehicle company

Who Must Create an AAP?


Affirmative Action Programs

Three types of written Affirmative Action Programs:

1) AAP for Minorities & Women (E.O. 11246)

2) AAP for Disabled (Sec. 503 of the Rehabilitation Act)

3) AAP for Protected Veterans (VEVRAA)

8

Ref: 41 CFR 60-2.1 (b) (1) (i-iv) 9

1) AAP for Women and Minorities - Executive Order (E.O.) 11246

Requires Federal contractors who have 50 or more employees and meet one of the following criteria to create an AAP:

• $50,000 or more in contract revenue during a 12 month period

• Serves as a depository of Government funds in any amount

• A financial institution who issues and pays U.S. saving bonds or saving notes


2) AAP for Disabled Persons - Section 503 of the Rehabilitation Act of 1974, as amended

Any contract in excess of $10,000 for personal property and non-personal services (including construction) shall contain a provision requiring that the party contracting with the government shall take affirmative action to employ and advance

in employment qualified individuals with disabilities.

Ref: 41 CFR 60-250


10

3) AAP for Veterans - Vietnam Era Veterans' Readjustment Assistance Act of 1974, as amended

Covered contractors “shall take affirmative action to employ and advance in employment qualified special disabled veterans, veterans of the Vietnam era and any other veterans who served on active duty during a war or in a campaign or expedition for which a campaign badge has been authorized.”

Ref: 41 CFR 60-250, 60-300


11

Apply to Government contracts of $25,000 or more entered into before December 1, 2003

Veterans covered:

• Special Disabled Veteran • Veteran of the Vietnam Era • Other Protected Veteran • Recently Separated Veteran • Required Filing: Vets-

100

§60-250 of the C.F.R.

Apply to Government contracts of $100,000 or more entered into after December 1, 2003

Veterans covered:

• Disabled Veterans • Armed Forces Service

Medal Veteran • Recently Separated Veteran • Other Protected Veteran • Required Filing: Vets-

100(A)

§60-300 of the C.F.R.

Ref: 41 CFR 60-250, 60-300

Who Must Create an AAP? Veteran Reporting

12


Thresholds Disabled Women & Minorities

Veterans

Contract Amount

Section 503 of Rehabilitation Act of 1973

Executive Order 11246

Vietnam Era Veterans' Readjustment Assistance Act of 1974

$10,000

$25,000 (§60-250)

$50,000

(§60-250)

$100,000 (§60-300)

Requirements

13

14

Requirements

Equal Opportunity Clause

• Every federal contractor that does business with non-government organizations for goods or services must include the Equal Opportunity Clause in contracts and purchase orders.

• Can be summarized with the following language, “all parties agree that they will abide by the provisions of 41 CFR 60-1.4(a) or 41 CFR 60-1.4(b), as appropriate.”

• For complete language, please see http://www.dol.gov/dol/allcfr/Title_41/Part_60-1/41CFR60-1.4.htm

Ref: 41 CFR 60-1.4


http://www.dol.gov/dol/allcfr/Title_41/Part_60-1/41CFR60-1.4.htm





15

Federal Civil Rights Agency Relationship

16

OFCCP Director Patricia Shiu

Regional Directors

1. New York 4. Chicago 2. Philadelphia 5. Dallas 3. Atlanta 6. San Francisco

54 District Directors

Assistant District Directors

Compliance Officers

OFCCP - Chain of Command

17 Copyright © Biddle Consulting Group, Inc.

Requirements

of an

Affirmative Action Plan

18

Federal Contractors Reporting Requirements

Affirmative Action Plan

• OFCCP

EEO-1 Reports

• Equal Employment Opportunity Commission

• Due September 30th annually

VETS-100 and/or VETS-100A

• Veterans‟ Employment and Training Services

• Due September 30th annually


Ref: 1. 41 CFR 60-2.17 2. 41 CFR 60-250, 60-300 3. 41 CFR 60-2.11-2.16 19

What does an AAP include?

• AAP for Women and Minorities

o Narrative 1

o Technical Reports3

• AAP for Veterans and Persons with Disabilities

o Narrative 2


20

AAP for Women and Minorities:

Narrative for Women and Minorities

• Chapters 1-6 (explains the technical reports) [Optional]

Designation of Responsibilities

Who is responsible to implement the AAP

President CEO

HR Manager

AA Officer

Managers and Supervisors


21

Narrative for Women and Minorities (Cont.)

Identification of Problem Areas

Action-Oriented Programs • Programs or steps that the contractor had taken in

the past, currently takes, and/or are willing to take in the future to remedy potential problem areas. Document ALL good-faith-efforts Example: XXXX will continue to place an ad in the

XXX for campus recruiting

Internal Audit and Reporting • Monitor all transactions to ensure the non-

discrimination policy is carried-out • Require internal reporting on a regular basis as to the

degree to which EEO objectives are attained • Review reports with all levels of management • Advise top management of program effectiveness


22

Technical Reports (AAP for Women and Minorities)

Workforce Analysis or Organizational Profile (Ref: 41 CFR 60-2.11(c))

Job group Analysis (Ref: 41 CFR 60-2.12)

Availability Analysis (Ref: 41 CFR 60-2.14)

Incumbency vs. Availability (Ref: 41 CFR 60-2.15)

Placement Goals (Ref: 41 CFR 60-2.16)

Additional Requirements:

Conducting Compensation Analysis

Conducting Adverse Impact Analysis

Data Needed: Personnel Transaction Data


23

Narrative for Veterans and Persons with Disabilities

Contractor‟s policies and procedures toward veterans and persons with disabilities

Required Contents:

Reaffirmation of EEO/AA Policy

Internal and External Dissemination of the Policy

Responsibility for Implementation

Review of Personnel Processes

Physical and Mental Qualifications

Reasonable Accommodations to Physical and Mental Limitations

Harassment

Training



Three (3) Important Questions:

1) What Are the Dates that I Should Consider?

2)How Many AAPs Should I Develop?

3)Who Should Be Included in the AAP?

24


Question 1:

What Are the Dates that I Should Remember?

25

26

AAP’s require three important sets of dates

1) Plan Implementation Dates

• Effective for a 12 month Period

• Example: January 1, 2011 through

December 31, 2011

2) Employee Snapshot Date

• A snapshot of current employees on a specific day

• Example: December 31, 2010

3) Transaction Dates

• Includes Applicants, Hires, Promotions, and Terminations

• 12 month period prior to the Implementation Period

• Example: January 1, 2010 through December 31, 2010



Question 2:

How Many AAPs Should I Develop?

27

28

Types of Affirmative Action Plans

1) Establishment-based AAP

• By location

2) Functional-based AAP

• By department, division, or business unit

• Requires permission from the OFCCP

3) Roll-Up AAP

• Regional, state, company-wide, etc.



Establishment or Roll-Up AAPs

29


Establishment or Roll-Up AAPs

30


Functional AAPs

Communications

Sales

Human Resources 31

Pros Cons

Easier/Accepted Practice Increased Audit Exposure

Less Costly Increased Sample Size =

Underutilization/Adverse

Impact

Less Work Greater chance that employees

are not similarly situated –

skewed analysis results

Pros and Cons to Rolled-Up AAPs


32


Question 3:

Who Are Included in the AAP?

33

Ref: 41 CFR 60-2.1(d) 34

Which employees are included?

• Each employee in the contractor‟s U.S. based workforce

Who are employees?

• The term „employee‟ is broad enough to include part-time, temporary, and full-time employees

• Are they on your payroll as of snapshot date?

How do we allocate employees to plans?

• Create a plan for that location

• Roll them into their manager‟s location

• Roll them into the location of their personnel function


Identify Who are the Corporate Initiative Employees:

Organizations are required to identify employees who work in one AAP location while being on the payroll at another AAP location and/or reports to another AAP location.

• The employees who physically work there will have to show in the workforce analysis of their physical location (with annotation); but nowhere else in the AAP.

• The employees who report to another location (AAP) are included in the all the reports of that AAP.


35

How to Define Corporate Initiative Employees

Recommendations:

• Include employees to the AAP where their supervisor are located

• Define Corporate Initiative employees as

those who are in certain “levels” (e.g.,

Executives, pay grade, etc.)


36

Ref: 41 CFR 60-2.11(c) 37

Workforce Analysis

• Provides an overview of the workforce at the establishment where women and minorities are underrepresented or concentrated in each department

• Each Workforce Analysis must display the following:

• Name of the Unit

• Job titles must be listed by in order of wage rate or salary ranges

• For each job title, the total number of incumbents by gender and total number of males and females within each race group

• Corporate Initiative employees identified by footnotes


38

Example of Workforce Analysis


XYZ

Ref: 41 CFR 60-2.12 39

Job Group Analysis

• All other reports from hereon will be based on job groups

• Identifying appropriate job groups is very critical

• Job groups are aggregations of jobs that are similar in content, wage and opportunity.


Workforce Analysis

• Jobs by department

Job Group Analysis

• Jobs by functional alignment regardless of department


Developing Job Groups

• Start with the EEO categories (e.g., Executive, Managers, Professionals, etc.)

• How many employees in each EEO category?

• Enough number of employees to break down into sub categories?

• Develop the sub categories

• Levels? (e.g., Entry Level, Mid Level, Senior Level)

• Specialty? (e.g., Administrative Professionals, Technical Professionals, Finance Professionals)

40

Company XYZ

1.1

1A

CEO

EVP

CFO

1.2

1B

Manager

1C

Supervisor A

2

2A

Accountant I

Accountant II

Sr. Accountant

2B

Engineer II

IT Support

2C

Nurse I

Nurse II

Nurse Lead

3

Tech I

4

Sales Rep

Job Groups: Organizational Structure

41

Job Groups: Organizational Structure

(EEO Cat – Organizations with 150 or less employees)

Company XYZ

1.1

CEO

EVP

CFO

1.2

Manager

2

Accountant I

Engineer II

IT Support

Nurse I

3

Tech I

4

Sales Rep

5

Admin I

Admin II

42

43

Example of Job Group Analysis


XYZ

Ref: 41 CFR 60-2.14 44

Availability Analysis

What is Availability?

• An estimate of the number of qualified minorities or women available for employment in a given job group.

• A combination of both internal and external comparison data (i.e. factors) used to identify what the composition of a job group is “supposed” to look like.

Two Factors

External Factor:

Census Codes – U.S. Census Bureau

Internal Factor:

Promotional Activity



Determining “Availability:”

Four (4) Steps:

1) Define the “Factors”

2) Define the External Recruitment Areas

3) Define the Internal Recruitment Source(s) or “feeders” job groups

4) Determine the Factor Weights.

45

Ref: 1. 41 CFR 60-2.14 (c) (1) 46

Availability Analysis --- Identifying Factors

1) Define the Factor(s) for each Job Group –

Ask this question: “If we are to fill vacancies into this job group, would it typically get filled externally (i.e., via hires) or internally (i.e., via promotions)?


JOB GROUP TITLE

EXTERNAL FACTOR

INTERNAL FACTOR

XYZ COMPANY

1A - Executives √

1B - Supervisors √ √

1C - Managers √ √

2A - Administrative Professionals √ √

2B - Technical Professionals √ √

8A - Laborers √

Ref: 1. 41 CFR 60-2.14 (c) (1) 47

Availability Analysis --- Identifying Factors

2) Define the external recruitment area(s) - A recruitment area is defined as the geographical area from which the contractor usually seeks or reasonably could seek workers to fill the positions in question.

1

• Local Labor Area (Recruitment Area 1) – Counties Close to the location

Zip Code Analysis

Asking Knowledgeable Staff

• Reasonable Area (Recruitment Area 2)– Wider area(s)

MSA/PMSA

State/Region

National


48

XYZ

Local Labor Area

Reasonable Labor Area


2a) Define the external recruitment area(s)


49

JOB GROUP TITLE

EXTERNAL FACTOR

XYZ COMPANY Recruitment

Area 1 (Local) Recruitment Area 2

(Reasonable)

1A - Executives

1B - Supervisors √ √

1C - Managers √ √

2A - Administrative Professionals √ √

2B - Technical Professionals √ √

8A - Laborers √

Ref: 1. 41 CFR 60-2.14 (c) (1) 50

Availability Analysis --- Identifying Factors issuing the Weights

3) Determine the Factor Weights. The weights given to the internal and external availability data for each job group.

Assigning the factor weights requires the user to ask the following question:

• “Out of 100 hypothetical movements into this job group, what number do I expect to come from a recruitment area (i.e. area 1 and area 2), or an internal pool?”


51


Example of Factor Weights

FACTOR WEIGHTS Enter percentage of recruiting done in each area for each

Job Group. Local = Counties close to job location.

Reasonable = Regional, statewide and nationwide recruitment.

Internal = Jobs filled through promotion/transfer. Note: percentages

Recruitment Area 1: Sacramento: 62.88%; El Dorado Hills: 25%; Placer Hills: 12.12%

JOB GROUP TITLE

EXTERNAL FACTOR INTERNAL FACTOR Recruitment Area 2: National: 100%

XYZ COMPANY

Recruitment Area 1 (Local)

Recruitment Area 2

(Reasonable)

Internal Total

1A - Executives 100.00% 100.00%

1B - Supervisors 11.88% 17.81% 70.31% 100.00%

1C - Managers 30.00% 30.00% 40.00% 100.00%

2A - Administrative Professionals 75.00% 5.00% 20.00% 100.00%

2B - Technical Professionals 50.00% 40.00% 10.00% 100.00%

8A - Laborers 100.00% 100.00%

Ref: 1. 41 CFR 60-2.14 (c) (1) 52

Availability Analysis --- Identifying Factors issuing the (Internal) Weights

4) Define the internal recruitment source(s) or “feeders” job groups – A feeder job group is composed of employees who are promotable/transferable/trainable within the organization.


2A 2B 50.00% 50.00%

2B 100.00%

8A 100.00%

53

Example of Availability Analysis


33.00 30.6

54

Additional Availability

Sources of data on the available labor pool other than the Census occupation data or Feeders

Example: National Opinion Research Center (NORC)

• Doctorate Degree


Ref: 41 CFR 60-2.15 55

Comparison of Incumbency to Availability

Compares the percentage of minorities and women in each job group with the availability for those job groups

• Refers back to the Job Group Analysis and the Availability Analysis.


Any Difference Rule

Whole Person Rule

80% Rule

80% + Whole Person Rule

Statistical Significance (Generalized or Exact Binomial)

56

Utilization Tests


Ref: 41 CFR 60-2.16 57

Placement Goals

Placement Goals – defined

• Serve as objectives or targets reasonably attainable by means of applying every good faith effort to make all aspects of the entire AAP work

Refers back to the Comparison of Incumbency to Availability Report

• If underutilization was flagged, (based on utilization test) this report will identify the strength or severity of the underutilization – the Placement Goal.

Placement goals refers to RECRUITMENT; they are not Hiring Goals


58

Example of Placement Goals Report


An Overview of the Reports

Step 1: Group Employees

Employees are grouped based on content, wage, and opportunity

Step 2: Availability Analysis

Identifies the gender and race/ethnic composition of both the external and internal available workforce

Step 3: Comparison of Incumbency to Availability

Identifies differences between current incumbency and available workforce

Step 4: Goals/Objectives

Where differences exist, identifies a placement goal for the underutilized group

Step 5: Action-Oriented Programs

Affirmative steps that will be taken to help achieve goals


59

Ref: 41 CFR 60-2.17 (b) (2) 60

Personnel Activity

Four types of activity

• Applicant Flow

• Hires

• Terminations

• Promotions

Analyzed to determine if there are selection disparities

• Via adverse impact analyses


61

Example of Personnel Transaction Report


62

Adverse Impact

Adverse Impact is when a facially neutral selection device or process yields a substantially different rate of selection in hiring, promotion or other employment decision which works to the disadvantage of members of a race, sex or ethnic group


Group Pass (Rate) Failed Total

Men 10 (50.0%) 10 (50.0%) 20

Women 5 (33.3%) 10 (66.7%) 15

Adverse Impact • Guidelines Method

Selection Rate Comparison Is the selection rate of females/minorities statistically

significant than the selection rate of males/non-minorities?*


Hires, Promotions, or Retentions (for terminations)

Applicants, Available for Promotions, Available for Terminations

* Every Group is Protected 63

64

Guidelines Method

You have a starting number and a completing number to compare statistically

• Example: Applicants to Hires comparison

Statistical Tests: • Chi-Square (estimated)

Requires strong sample sizes (>30)

This is the preference for the OFCCP

• Fisher’s Exact

More sensitive and appropriate for smaller sample sizes

Industry standard adverse impact test


65

Example of Adverse Impact Analysis (Guidelines Method)


2A - Professionals

Females

Representation 50.0%

Availability 82.5%

Adverse Impact • Hazelwood Method

Availability Comparison Is the representation of women/minorities statistically

significantly different their availabilities?


Utilization Analysis

Example:

66

67

Adverse Impact (cont.)

Hazelwood Method

• Used when you have a number (e.g., counts of employees, counts of hires, etc.) to compare to its own availability

Example: Hires vs. Final Availability

Hazelwood School District v. United States


68

Example of Adverse Impact Analysis (Hazelwood Method)


2A - Professionals

Ref: 41 CFR 60-2.17 (b) (3) 69

Compensation System(s)

AAP must include compensation data to determine whether there are gender, race, or ethnicity pay disparities

“Item 11 Data” (Audit Letter)

• A listing of the sum of annual salaries for men and women as well as non-minorities and minorities grouped in the manner of your compensation system

• Submit the data in groupings that best explain your compensation system


70

Example of Compensation Data (Item 11) Report


71

The Big Picture

• Each required report builds a chapter in the story of your organization‟s AAP.

• There are no “stand-alone” reports; each report feeds from the previous report.

• You are left with a view of what you “should” look like, what you “do” look like, and how you got there.


Copyright © Biddle Consulting Group, Inc.

72

• Regulatory Revisions: In FY 2012, OFCCP is scheduled to

• finalize its revision on 41 CFR Part 60-4 which impacts contractors and subcontractors in the construction industry

• finalize its revision on 41 CFR Part 60-741 which protects workers with disabilities and finalize and publish its revision on VEVRAA (summer 2011).

• Construction Contractor Affirmative Action Requirements: OFCCP is proposing change to the regulations to reflect the current state of the labor market and construction industry. The goals is to remove outdated requirements and propose a new method for goal setting for construction contractors

OFCCP Update

73

• Evaluation of Recruitment and Placement Results under Section 503: OFCCP is proposing change to the regulations to require increased linkages, a more substantive analysis of recruitment/placement efforts, and revise the recordkeeping requirements for individuals with disabilities

OFCCP Update

74

75

Q & A

Documents

Affirmative Action Planning Methodology 101 Part I...Words to Know AAP – Affirmative Action Plan EEO – Equal Employment Opportunity Federal Contractor – Has a contract with the