EEAC Comments to OMB

EQUAL EMPLOYMENT
ADVISORY COUNCIL

SUITE 400
1501 M STREET, NW
WASHINGTON, DC 20005

TEL 202/629-5650
FAX 202/629-5651

February 8, 2016
Via Electronic Mail: [email protected]
Office of Information and Regulatory Affairs
Attn: OMB Desk Officer for DOL-OFCCP
Office of Management and Budget, Room 10235
725 17th Street NW
Washington, DC 20503
Re:

Comments of the Equal Employment Advisory Council on the Office of
Federal Contract Compliance Programs’ Information Collection Request
Revision Titled, “Agreement Approval Process for Use of Functional
Affirmative Action Programs” (OMB Control Number 1250-0006)

Dear OMB Desk Officer:
The Equal Employment Advisory Council (“EEAC”) respectfully submits these
comments in response to the Office of Federal Contract Compliance Programs’ (“OFCCP” or
“the agency”) proposed information collection request (ICR) revision regarding the agency’s
Agreement Approval Process for Use of Functional Affirmative Action Programs, notice of
which was published in the Federal Register on January 8, 2016. 81 Fed. Reg. 970.
This ICR covers the recordkeeping and reporting obligations imposed upon those
federal contractors that seek OFCCP’s approval to implement a functional affirmative action
program (“FAAP”) structure, as well as those that seek to update, modify, and certify an
existing FAAP agreement. Importantly, EEAC is a strong proponent of the FAAP structure
option, and believes that it enhances affirmative action compliance to the benefit of all
parties involved. Accordingly, the recommendations we make below are offered in the spirit
of improving a program that EEAC supports.

STATEMENT OF INTEREST
EEAC is the nation’s largest nonprofit association of employers dedicated exclusively
to the advancement of practical and effective programs to eliminate employment
discrimination. Formed in 1976, EEAC’s membership includes approximately 270 of the
nation’s largest private-sector corporations, who collectively employ more than 10 million
workers in the United States alone. Nearly all EEAC member companies are subject to the
nondiscrimination and affirmative action requirements of Executive Order 11246, the
Rehabilitation Act of 1973, the Vietnam Era Veterans’ Readjustment Assistance Act of
1974, and their implementing regulations. As major federal contractors and subcontractors,
our members have a significant stake and interest in ensuring that OFCCP’s regulations and
paperwork requirements, including those triggered by the agency’s FAAP request-andapproval process, efficiently and effectively accomplish their underlying policy objectives.

OMB Desk Officer for DOL-OFCCP
February 8, 2016
Page 2

BACKGROUND
OFCCP’s ICR reflects the agency’s proposed changes to the application and approval
process which federal contractors must follow to be able to structure their affirmative action
programs (“AAPs”) by function or business unit rather than by physical location. 1 More
specifically, the ICR pertains to documents and information that OFCCP would require
federal contractors to prepare and disclose in advance of, and during, a FAAP approval
“conference” with the OFCCP, ostensibly to allow the agency to reasonably determine
whether the contractor’s structure and business operations are suitable for FAAP approval.
These documents and information are detailed in Attachments B and C to the proposed
revised FAAP Directive OFCCP has submitted to OMB for approval.
This proposed directive and its accompanying attachments reflect several minor
changes, clarifications, and formal codification of certain standard FAAP-related practices
that have evolved over time. EEAC’s pre-clearance comments to OFCCP 2 offered
suggestions that we believed would help make the FAAP request-and-approval process more
efficient for both contractors and OFCCP. Specifically, EEAC recommended that OFCCP
remove the current requirement that contractors submit copies of personnel policies and
procedures and a copy of at least one qualifying federal contract (or subcontract) as part of
their FAAP application. In addition, we recommended that the agency grant conditional
approval to any contractor that submits a timely and complete FAAP application.
Acknowledging that it is unlikely that an employer would apply for FAAP approval if
the company was not a covered federal contractor, OFCCP has now agreed to remove the
requirement that contractors submit a copy of a qualifying federal contract or subcontract, a
change that we strongly support. In the same spirit, we also believe that three additional
and relatively minor revisions to the final FAAP directive, discussed below, would further
enhance the FAAP request-and-approval process consistent with OFCCP’s stated goal of
making it “simple and fluid,” as well as reduce the burden on federal contractors seeking
FAAP approval.

RECOMMENDATIONS FOR REVISIONS TO THE ICR
INFORMATION REGARDING FEDERAL CONTRACTS
When EEAC suggested that OFCCP remove the requirement that contractors applying
for a FAAP agreement submit a copy of a qualifying federal contract or subcontract, we
neglected to recommend that OFCCP also remove the similar requirement that contractors
provide information regarding their federal contracts or subcontracts. Perhaps accordingly,
OFCCP agreed to remove the former requirement, but not the latter. However, we

OFCCP regulations require that contractors seeking to prepare AAPs in a manner other than by physical
location (e.g., on a functional basis), must seek OFCCP’s advance permission. 41 C.F.R. § 60-2.1(d)(4). In the
absence of an approved FAAP agreement, the regulations require contractors to develop, implement, and
maintain a separate AAP for each physical location of an establishment with 50 or more employees.
2 We have attached our preclearance comments to this letter for your convenience.
1

OMB Desk Officer for DOL-OFCCP
February 8, 2016
Page 3
respectfully submit that the reasoning behind the removal of one requirement applies
equally to the other, and the burden on federal contractors is the same for both.
Attachment B requires applicants to provide a statement that the company is a
covered federal contractor and include “information regarding at least one federal contract
or subcontract of $50,000 or more, identifying the name of the federal contracting agency,
the contract number, the contract period, and the name of the prime contractor if the
contractor is a subcontractor.” Moreover, when a company seeks to renew a FAAP
agreement (or “certify” under the proposed ICR), the company is required to provide
updated federal contract information to the same level of specificity as the Attachment B
requirement.
While this request may sound simple enough, the FAAP application itself makes the
required statement as to the company’s federal contractor status redundant. Further, as a
practical matter the human resources and compliance professionals assigned the
responsibility of managing the FAAP request-and-approval process rarely if ever have direct
access to the company’s federal contracts. Even for the contract/procurement
professionals at the types of large, complex organizations that benefit most from the FAAP
program, identifying and producing for OFCCP’s review one or more “qualifying” federal
contracts can be a burdensome and time-consuming task.
The submission of these documents, or information about them, simply is not a
necessary component of the FAAP approval process. First, no company would submit to this
process and disclose confidential business information to OFCCP if the company was not
already a federal contactor.
Second, and perhaps most importantly, OFCCP carries out its enforcement
responsibilities on an ongoing basis without these documents, including conducting
approximately four thousand compliance evaluations annually of federal contractor
establishments without asking these contractors for a copy of, or information about, a
“qualifying” federal contract. In other words, OFCCP has no trouble establishing jurisdiction
without requiring contractors who prepare establishment-based AAPs to do it for them.
In order to produce information about a contract, of course, companies would still
need to identify and retrieve the contract itself, so the burden is the same. The FAAP
community gains nothing from the elimination of one requirement but not the other. If the
production of an actual qualifying contract is unnecessary, it stands to reason that the
production of information regarding a qualifying contract is unnecessary as well.
For these reasons, OFCCP agreed to drop the requirement that applicants produce
copies of these contracts. And for these same reasons, we respectfully submit that it is both
burdensome and unnecessary for the agency to continue to require contractors to submit
information regarding qualifying federal contracts in either the FAAP application or
renewal/certification process.

OMB Desk Officer for DOL-OFCCP
February 8, 2016
Page 4
COPIES OF PERSONNEL POLICIES AND PROCEDURES
EEAC also recommended to OFCCP that it remove from Attachment B the required
submission of personnel policies, while retaining the provision in Attachment C that would
require their discussion. Although OFCCP declined to do so, we are renewing this request to
OMB.
Attachment B currently requires that in advance of the FAAP conference with OFCCP,
the contractor must prepare and submit “[c]opies of personnel policies relevant to
evaluating the proposed functions or business units, including organizational and unitspecific policies related to recruitment; hiring; promotion; compensation; and termination.”
OFCCP’s proposed revision retains this requirement, but substitutes the broader term,
“discipline” for “termination.”
Attachment C requires that, during the FAAP approval conference, the contractor be
prepared to discuss “[p]ersonnel procedures including recruitment; hiring; promotion;
compensation; termination; record retention and data analysis as they apply to each
functional or business unit, including identification of units that have differing personnel or
compensation practices.”
EEAC acknowledges that each functional unit’s ability to efficiently manage and
monitor its personnel actions is certainly relevant to an assessment of a company’s FAAPs.
However, we respectfully submit that ability rarely would exhibit itself in any definitive way
through company documents. Moreover, for the types of large, complex organizations that
benefit most from the FAAP program, this requirement often entails the copying and printing
of possibly hundreds of pages of confidential company policies. The utility of such an
exercise is unclear.
Neither the lack nor abundance of such documents sheds significant light on the
extent to which the company’s functions or business units operate sufficiently independently
to sustain a FAAP program. For instance, a company could impose uniform, organizationwide policies and procedures and still operate with distinct functions. Conversely, a
company could have policies and procedures unique to each individual manager and not
satisfy the requirements for a FAAP program.
That is not to say that a company’s various policies and procedures are irrelevant to
the discussion, and we agree there could conceivably be a point in the FAAP request-andapproval process where OFCCP might need to see documentation to substantiate what is
discussed during the FAAP approval conference. We recommend that such documentation
be “situation specific,” however, and requested by OFCCP only where it is directly relevant to
questions that arise during the FAAP conference.
Accordingly, EEAC respectfully requests that Attachment C’s provision requiring the
discussion of personnel policies be retained, but that Attachment B be modified to eliminate
the provision that would require their submission in advance for every FAAP application.

OMB Desk Officer for DOL-OFCCP
February 8, 2016
Page 5
INFORMATION ON SUBSIDIARIES
The proposed Attachment B requires “[t]he names of all subsidiaries in the
company’s family tree and an explanation of whether these companies are included in the
contractor’s AAP structure. If these companies are included in any of the proposed
functional units, they must be clearly identified on the employee location listing referenced
in item 6 above. If they are not included in the proposed functional units, provide
information concerning these companies consistent with item 9 below.” OFCCP’s current
FAAP directive does not contain this requirement.
From a technical standpoint, we first note that OFCCP appears to have mis-numbered
the references in this paragraph. We believe that the agency intends for the paragraph to
refer to item 5 rather than item 6, and item 8 rather than item 9. EEAC respectfully requests
that this paragraph be edited accordingly if it is included in the final revised directive.
From a practical standpoint, we submit that this requirement is both burdensome
and unnecessary. The very purpose of the FAAP program is to allow contractors to develop
AAPs that align with how the organization actually operates. Organizational functions can
not only cross establishments, but can in fact cross related companies. It is not unusual for
separate companies under the same corporate umbrella, such as subsidiaries, to share
certain services. These shared service functions may in turn be ideal for a functional AAP.
Detailed information about the various companies or subsidiaries served is simply irrelevant
to the determination of whether or not a FAAP is appropriate.
Further, many of the large, complex organizations that benefit from FAAP
arrangements often operate one or more legally separate entities that are not subject to
OFCCP jurisdiction by virtue of a qualifying federal contract held by another organization.
Information regarding “all subsidiaries in the company’s family tree” could mire the FAAP
approval process in a dispute over whether or not OFCCP jurisdiction extends to certain
companies, significantly slowing the process and discouraging federal contractors from
seeking FAAP approvals.
Finally, we submit that the information OFCCP seeks is not as straightforward as it
might initially seem. The human resources and compliance professionals assigned the
responsibility of managing the FAAP request-and-approval process do not typically have
access to the information necessary to meet this requirement. Moreover, even for the
corporate and legal professionals who do, providing a list of “all subsidiaries in the
company’s family tree” may be no easy task if the organization is regularly involved in
mergers, acquisitions, divestitures, joint ventures, and other business transactions. The
relationships among the various companies or subsidiaries can be incredibly complex. We
believe that having to develop a comprehensive list in the manner OFCCP requests can be a
burdensome and time-consuming task with no clear utility in the FAAP application process.
OFCCP’s burden statement does not provide a calculation specific to this new
requirement. Rather, the agency generally estimates 51 hours per company to prepare the
initial FAAP request and the additional information discussed during the approval process.
We respectfully submit, however, that this one new requirement alone could easily exceed
the total burden estimate for the entire process.

OMB Desk Officer for DOL-OFCCP
February 8, 2016
Page 6
For these reasons, EEAC requests that this requirement be eliminated from OFCCP’s
proposed Attachment B.

CONCLUSION
We appreciate the opportunity to make our views known to OMB, and would welcome
any questions you may have.
Sincerely,
Matt A. D. Nusbaum
Senior Counsel and Director of
OFCCP Compliance Programs
cc: Department of Labor--OASAM