Unconfirmed complaints may be enough to trigger an early OFCCP audit

Can a year-old rumor be enough to bring the OFCCP running? One administrative law judge says it can. Judge Lystra Harris recently ruled that, because of an oral complaint of discrimination, Mega Construction Project subcontractor Baker DC, LLC, must allow an earlyAlyssa Peters on-site by the Office of Federal Contract Compliance Programs.

To understand the problematic nature of the ruling, let's first look at the ground rules. The Fourth Amendment to the U.S. Constitution prevents the OFCCP, as a federal investigatory agency, from conducting a “search” (or in this case an audit) without probable cause. According to the U.S. Court of Appeals for the Fifth Circuit, for an audit to be reasonable, the OFCCP must show either (1) specific evidence of an existing violation, (2) reasonable legislative or administrative standards for conducting the search that have been met with respect to the particular contractor, or (3) an administrative plan containing specific neutral criteria justifying the search.

In the case of Mega Construction contractors, “specific neutral criteria” is generally a given because it is virtually written into the OFCCP’s Mega Construction Project Program. That is, if the construction project receiving federal funds is worth more than $25 million and lasts longer than one year, the contractor can participate in the MCP, in which the OFCCP provides compliance assistance with equal employment opportunity requirements. But this “assistance” subjects all eligible contractors to auditing by the OFCCP after at least three months of work on a Mega project. According to the OFCCP testimony at the Baker trial, subcontractors are normally scheduled for audits in the order in which they reach the three-month milestone. Seems pretty neutral to me.

OFCCP witnesses also testified that “the OFCCP schedules contractors for whom it receives credible complaints out of order because such companies are of concern to OFCCP and its procedures.” According to the OFCCP, the agency received such a “credible complaint” about Baker. In March 2015, at an outreach event for another review, some attendees were “sitting around a table discussing incidents of discrimination” when a few individuals complained to an Assistant District Director about Baker’s practices, including complaining that African-Americans were not hired and that a female apprentice applicant was not selected. There was no follow-up at the time, and no notes were taken that reflect the comments. On cross-examination, the OFCCP witnesses admitted that they did not know how many of the complainants actually worked for Baker, or the specific project on which the discriminatory practices allegedly occurred. So what’s a “credible” complaint? Tom Wells, Director of the OFCCP's Baltimore District Office, defined “credible” as “good reason to believe that the statements could be true.” For Mr. Wells, these verbal complaints met that definition because there was “specificity” to the complaints and there were several people complaining.

Baker had objected to the early audit on Fourth Amendment grounds and argued (among other defenses) that its selection for audit was not neutral. Dismissing Baker’s objections, the ALJ ruled that Baker’s selection was neutral and that the audit could continue. In the ALJ's view, Baker was already scheduled for an audit (based on the seniority approach normally used for MCPs), and the “credible” complaint merely advanced the timeline.

In other words, the judge seems to be saying—“So what’s the big deal?  You would have been scheduled for a review anyway pursuant to the neutral scheduling process. Now it is just a few months earlier.” But contractors that have received a notorious “30-day letter” know that every day counts; cutting months out of preparation time for an audit can be a huge deal. The implications of this ruling could be extensive.  In the meantime, contractors should keep their EEO initiatives a priority and their affirmative action plans up to date.

Who knows when a random person may make a “credible” comment about discrimination that is overheard by an OFCCP investigator, triggering an early audit?

Robin Shea has 30 years' experience in employment litigation, including Title VII and the Age Discrimination in Employment Act, the Americans with Disabilities Act (including the Amendments Act). 
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