Beware The Hidden Costs
If your company receives stimulus funds from the U.S. government, you may become a federal contractor, subject to the affirmative action and other compliance requirements of the U.S. Office of Federal Contract Compliance Programs.
President Obama signed the American Recovery and Reinvestment Act of 2009, also known as the "Stimulus Package," on February 17, 2009. The ARRA was intended to stimulate our nation's economy and create employment opportunities, and includes measures designed to improve our nation's infrastructure, highway system, energy options, and educational opportunities, among other things.
Accepting these funds can have a big "catch." Companies accepting stimulus funds or entering into contracts related to "stimulus projects" should ensure that they understand the consequences of doing so. The U.S. Department of Labor has made it clear that recipients of ARRA funds are federal contractors and subcontractors, and (if the threshold requirements are met) they must comply with the laws that ensure equal employment opportunity and/or affirmative action based on race, color, religion, sex, national origin, disability, and protected veterans' status. The OFCCP has announced that it will ensure compliance and enforcement of these laws by conducting compliance evaluations and will place special emphasis on the construction industry, as the majority of funds under ARRA are marked for construction projects. The OFCCP plans to conduct at least 360 construction reviews and 90 supply and service reviews of companies receiving ARRA funds, targeting first-time federal contractors and subcontractors. This initiative began July 1.
Don't be caught unawares! If you need assistance in determining whether your company is now covered, ensuring all reporting and compliance requirements are met, or preparing your affirmative action program, please contact a member of Constangy's Strategic Affirmative Action Practice Group or the Constangy attorney of your choice.
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