Federal contractors facing hiring and employment audits should carefully review the time frame for which data is requested. An Administrative Law Judge has ruled that the Office of Federal Contract Compliance Programs does not have unlimited authority in requesting information during an audit.

Administrative Law Judge Larry W. Price ruled on July 23, 2010, that an employer is not required to provide the OFCCP with applicant and employment records tied to hiring decisions made after the employer has been notified that it has been selected for a compliance review. OFCCP v. Frito-Lay, Inc., Case No. 2010-OFC-00002 (7/23/10). An appeal is possible.

The OFCCP sent Frito-Lay a letter dated July 13, 2007, stating that one of the company's facilities had been selected for a compliance review pursuant to Executive Orders 11375, 12086, and 13279. The letter requested data for Frito-Lay's 2006 affirmative action plan year and for the first half of 2007. Subsequently, the OFCCP sought data for the remainder of 2007 and back to July 13, 2005. Frito-Lay complied with these requests.

After analyzing the data from June 13, 2006, to December 31, 2007, the OFCCP concluded that there had been an adverse impact in hiring women. On November 10, 2009, the OFCCP asked Frito-Lay to submit additional data for applicants and hires from January 1, 2008, through October 31, 2009. Frito-Lay refused to provide this data.

ALJ Price rejected the OFCCP argument that a federal contractor's duty to maintain and preserve applicant and hiring data gave the agency the right to access those materials as part of an ongoing compliance evaluation. Rather, he relied on the Federal Contract Compliance Manual (FCCM), which states in numerous places that the normal liability period for a compliance audit is the two years before it is initiated. So, the 2008 and 2009 data was not relevant.

Although the OFCCP argued that the FCCM was not binding on the agency, ALJ Price found no regulatory support for the OFCCP position that it was entitled to information created after a notice of an audit and noted that the regulations frequently refer to the FCCM as the "appropriate guidance" for the temporal scope of a compliance review.

Although Judge Price's order may be appealed, and the OFCCP is revising the FCCM, employers should be mindful of the time frame for any requested data. If you have questions about the OFCCP audit process or affirmative action plans and obligations in general, please contact Frank A. Chernak, 215.864.8234 or chernakf@ballardspahr.com, or any other member of Ballard Spahr's Labor and Employment Group. 


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