In a previous post, we discussed contractors’ equal opportunity obligations. Today we address its cousin requirement: affirmative action programs.

As with equal opportunity, we will focus our overview on supply and service contractors. We’ll leave affirmative action requirements for construction contractors for a later time.

FAR clauses

For non-construction contractors, there is no specific FAR clause mandating an affirmative action program. Yet, the requirement exists through FAR 52.222-26 (Equal Opportunity). Under that clause, contractors must abide by DOL’s regulations implementing EO 11246. And guess what those regulations, in part, call for? You guessed it: an affirmative action program. The relevant section is 41 C.F.R. 60-2, which is aptly titled “Affirmative Action Programs.”

That said, non-construction contractors will likely see FAR 52.222-25 (Affirmative Action Compliance). That clause has a limited purpose, however. It merely asks a contractor to represent whether it has already developed a compliant affirmative action program.

Which contractors must develop an affirmative action program?

Any contractor with more than 50 employees and a contract over $50,000 must develop a written affirmative action program for each of its establishments. Further, each contractor must require its subcontractors (with 50 or more employees and a subcontract of $50,000+) to create an affirmative action program for each of its establishments.

You’re probably wondering what an establishment is? So, you might be surprised (or not) to find out that the regulation doesn’t define the term! But, the OFCCP provides some public guidance:

Generally, OFCCP considers an establishment to be a physical location, such as a factory or office. However, some contractors with campus-like settings may have multiple buildings that constitute an establishment for purposes of developing and maintaining their AAPs. These types of contractors could include educational institutions, hospitals, and information technology companies, among others.

So, a covered contractor must have a separate affirmative action program for each of its physical locations. In other words, an affirmative action program is not a one-and-done proposition–unless, of course, the contractor has a single location.

Developing and updating an affirmative action program

For a contractor without an affirmative action program, they must develop one within 120 days after the triggering contract begins.

For a contractor with an existing affirmative action program, it must update the program every year.

Who belongs in an affirmative action program?

Contractors must include all their employees in an affirmative action program. Normally, each employee must belong to affirmative action program of her establishment, unless one of the following applies:

  • If an employee and her manager work at different establishments, the contractor can incorporate the employee into the affirmative action program of her manager’s establishment.
  • For employees who work at establishments with less than 50 employees, they can be included in one of the following options:
    • an affirmative action program covering just that establishment;
    • an affirmative action program covering the location of the personnel function that supports the establishment; or
    • an affirmative action program which covers the location of the official to whom they report.
  • If a contractor makes selection decisions regarding an employee at a higher level establishment within the firm, the contractor must include that employee in the affirmative action program of the establishment where the selection decision is made.

What if a contractor wants to formulate affirmative action programs other than by establishment? Is that possible? Yes, but OFCCP must specifically approve it.

Contents of an affirmative action program

We don’t have space here to do a deep dive into the content of an affirmative action program. But here is a quick run down of the general requirements.

  • Organizational display: a detailed graphical or tabular chart, text, spreadsheet or similar presentation of the contractor’s organizational structure.
  • Workforce analysis: a listing of each job title as it appears in the contractor’s payroll records. For each job title, the contractor must note the total number of incumbents, the total number of male and female incumbents, and the total incumbents in each of the following groups: Blacks, Hispanics, Asians/Pacific Islanders, and American Indians/Alaskan Natives.
  • Job group analysis: a grouping of jobs with similar content, wage rates, and opportunities. Small contractors (less than 150 employees) can use the EEO-1 categories as job groups.
  • Availability analysis: a listing of the percentage of minorities and women in each job group compared with an estimate of the number of qualified minorities or women available for employment in a given job group.
  • Placement goals: reasonable objectives to ensure that minorities and women are equally employed in each job group.
  • Responsibility designation: naming an organization official to oversee the organization’s implementation of equal opportunity and affirmative action program.
  • Identifying problem areas: an in-depth analysis of the contractor’s employment process and whether there are impediments to equal opportunity.
  • Action-oriented programs: procedures to correct any identified problems.
  • Internal audit and reporting system: a system to periodically measure the effectiveness of the total affirmative action program.

Enforcement and penalties

The penalties for noncompliance are not pleasant. They range from being declared non-responsible for a contract, losing a contract, or even worse. So, the takeaway is: get compliant with the affirmative action program.

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If you have any questions regarding affirmative action programs, equal opportunity compliance or other labor laws applicable to Government contractors, such as the Service Contract Act, give us a call at 913-354-2630.

Understanding the Basics: Government Contractors and Affirmative Action Programs was last modified: January 12th, 2022 by John Mattox