Most federal contractors are required to have an Affirmative Action Plan (AAP) when they are awarded a government contract. However, developing an AAP to meet Office of Federal Contract Compliance Programs (OFCCP) regulations has many elements within it and can be difficult to understand. In order to meet requirements and avoid compliance violations, here's some fundamental information on an AAP.
What is an Affirmative Action Plan?
An AAP is a documented roadmap that federal contractors implement to ensure equal employment opportunities are available for applicants or employees regardless of race, color, religion, sex, sexual orientation, gender identity, national origin, disability, or status as a protected veteran. The AAP includes information on your organization’s hiring, firing, layoffs, promotions, training, demographic make-up, organizational structure, and more for that AAP year.
Additionally, federal contractor’s AAP should be able to identify certain individuals underutilized within job groups. For example, a federal contractor may need to increase their number of women in their Information Technology (IT) department and should then focus their outreach efforts to women in IT.
AAPs are to be updated annually and federal contractors should document the previous year’s outreach efforts in the current year plan.
AAPs include information about your organization’s:
Hires, terminations and promotions.
Outreach efforts to women, minority groups, veterans and individuals with disabilities.
Evaluation of your utilization goal for individuals with disabilities (currently 7% of each job group). This means 7% of your employees, per job group, should have identified as having a disability.
Evaluation of your hiring benchmark for protected veterans (currently 5.6%). This means 5.6% of all your hires should be protected veterans.
Review of your organization's personnel processes and policies
Documenting your practices also ensures everything you need for internal reporting and auditing systems to measure and track the progress of maintaining non-discriminatory practices. Having an AAP in place is the beginning of a contractor’s steps toward compliance. Sample AAPs provided by the OFCCP are available here.
Do I Need an AAP?
It is always good business practice to have an affirmative action plan. It helps your organizations become a diverse workforce by identifying adverse impact and helps create a roadmap to become a inclusive employer. However, OFCCP regulations mandate it for most contractors, using workforce and dollar amounts to determine which federal contractors must have a written AAP and which laws they must adhere to.
Contractors may have to follow one or more of these laws: Executive Order 11246, Vietnam Era Veteran Readjustment Assistance Act (VEVRAA), and Section 503 of the Rehabilitation Act. Each law has its own set of regulations.
Once the contractor identifies the threshold they fall under, they must have a written AAP within 120 days of their contract. The OFCCP can help provide contractors with AAP requirements on what they need to meet standards. More information about AAP requirements can be found here.
Here are employee and dollar thresholds that determine if you an AAP and what type:
If your business has 50 or more employees and at least a $50,000 federal contract or subcontract, you have an AAP for women, minorities, and individuals with disabilities
If your business has 50 or more employees and at least a $150,000 federal contract or subcontract, an AAP for veterans is also required.
Certifying Your Plan
The OFCCP recently developed an Affirmative Action Program Verification Interface. This electronic OFCCP contractor portal allows federal contractors and subcontractors to verify to the OFCCP that they have current AAPs. If a contractor fails to certify within the portal, they may increase their risk of audits.
The contractor portal launched in February 2022 and if you are an existing federal contractor, you may now register. The certification features in the portal will be available on March 31, 2022, and existing contractors must certify that they have an AAP by June 30, 2022.
Federal contractors and subcontractors who meet jurisdiction thresholds are required to use the contactor portal to register and certify they have current AAPs. You can find out more information on the certification process on the OFCCP portal FAQs section.
Summary
AAPs is designed to make sure that all qualified employees and applicants are provided with equal opportunities throughout every aspect of the employment process. Though the OFCCP requires most contractors to provide an AAP, every organization should adopt one because it can foster a diverse and inclusive workforce.
For more information about OFCCP compliance and the laws it involves, visit our recent story, The Basics of OFCCP Compliance.
Click below to contact one of our OFCCP experts if you’re ready to get your compliance journey started.
Disclaimer: This is not intended to offer legal advice. Secure legal counsel when ensuring government compliance.
