FEDERAL-AID POLICY GUIDE
December 9, 1991, Transmittal 1
23 CFR 230D
SUBCHAPTER C - CIVIL RIGHTS
PART 230 - EXTERNAL PROGRAMS
Subpart D - Construction Contract Equal Opportunity Compliance Procedures
230.405 Administrative responsibilities.
230.409 Contract compliance review procedures.
230.411 Guidance for conducting reviews.
230.413 Review reports.
230.415 Consolidated compliance reviews.
Appendix A-Sample Show Cause Notice
Appendix B-Sample Corrective Action Plan
Appendix C-Sample Show Cause Rescission
Appendix D-Equal Opportunity Compliance Review Process Flow Chart
Authority: 23 U.S.C. 140(a), 315; E.O. 11246; 41 CFR 60-1; 49 CFR 1.48.
Source: 41 FR 34239, Aug. 13, 1976, unless otherwise noted.
Sec. 230.401 Purpose.
The purpose of the regulations in this subpart is to prescribe policies and procedures to standardize the implementation of the equal opportunity contract compliance program, including compliance reviews, consolidated compliance reviews, and the administration of areawide plans.
Sec. 230.403 Applicability.
The procedures set forth hereinafter apply to all nonexempt direct Federal and Federal-aid highway construction contracts and subcontracts, unless otherwise specified.
Sec. 230.405 Administrative responsibilities.
(a) Federal Highway Administration (FHWA) responsibilities.
(1) The FHWA has the responsibility to ensure thatcontractors meet contractual equal opportunity requirements under E.O. 11246, as amended, and Title 23, United States Code, and to provide guidance and direction to States in the development and implementation of a program to assure compliance with equal opportunity requirements.
(2) The Federal Highway Administrator or a designee may inquire into the status of any matter affecting the FHWA equal opportunity program and, when considered necessary, assume jurisdiction over the matter, proceeding in coordination with the State concerned. This is without derogation of the authority of the Secretary of Transportation, Department of Transportation (DOT), the Director, DOT Departmental Office of Civil Rights (OCR) or the Director, Office of Federal Contract Compliance Programs (OFCCP), Department of Labor.
(3) Failure of the State highway agency (SHA) to discharge the responsibilities stated in Sec. 230.405(b)(1) may result in DOT's taking any or all of the following actions (see Appendix A to 23 CFR Part 630, Subpart C "Federal-aid project agreement"):
(i) Cancel, terminate, or suspend the Federal-aid project agreement in whole or in part;
(ii) Refrain from extending any further assistance to the SHA under the program with respect to which the failure or refusal occurred until satisfactory assurance of future compliance has been received from the SHA; and
(iii) Refer the case to an appropriate Federal agency for legal proceedings.
(4) Action by the DOT, with respect to noncompliant contractors, shall not relieve a SHA of its responsibilities in connection with these same matters; nor is such action by DOT a substitute for corrective action utilized by a State under applicable State laws or regulations.
(b) State responsibilities.
(1) The SHA's, as contracting agencies, have a responsibility to assure compliance by contractors with the requirements of Federal-aid construction contracts, including the equal opportunityrequirements, and to assist in and cooperate with FHWA programs to assure equal opportunity.
(2) The corrective action procedures outlined herein do not preclude normal contract administration procedures by the States to ensure the contractor's completion of specific contract equal opportunity requirements, as long as such procedures support, and sustain the objectives of E.O. 11246, as amended. The State shall inform FHWA of any actions taken against a contractor under normal State contract administration procedures, if that action is precipitated in whole or in part by noncompliance with equal opportunity contract requirements.
Sec. 230.407 Definitions.
For the purpose of this subpart, the following definitions shall apply, unless the context requires otherwise:
(a) "Actions," identified by letter and number, shall refer to those items identified in the process flow chart. (Appendix D);
(b) "Affirmative Action Plan" means a written positive management tool of a total equal opportunity program indicating the action steps for all organizational levels of a contractor to initiate and measure equal opportunity program progress and effectiveness. (The Special Provisions [23 CFR 230 A, Appendix A] and areawide plans are Affirmative Action Plans.);
(c) "Affirmative Actions" means the efforts exerted towards achieving equal opportunity through positive, aggressive, and continuous result-oriented measures to correct past and present discriminatory practices and their effects on the conditions and privileges of employment. These measures include, but are not limited to, recruitment, hiring, promotion, upgrading, demotion, transfer, termination, compensation, and training;
(d) "Areawide Plan" means an Affirmative Action Plan approved by the Department of Labor to increase minority and female utilization in crafts of the construction industry in a specified geographical area pursuant to E.O. 11246, as amended, and taking the form of either a "Hometown" or an "Imposed" Plan.
(1) "Hometown Plan" means a voluntary areawide agreement usually developed by representatives of labor unions, minority organizations, and contractors, and approved by the OFCCP for thepurpose of implementing the equal employment opportunity requirements pursuant to E.O. 11246, as amended;
(2) "Imposed Plan" means mandatory affirmative action requirements for a specified geographical area issued by OFCCP and, in some areas, by the courts;
(e) "Compliance Specialist" means a Federal or State employee regularly employed and experienced in civil rights policies, practices, procedures, and equal opportunity compliance review and evaluation functions;
(f) "Consolidated Compliance Review" means a review and evaluation of all significant construction employment in a specific geographical (target) area;
(g) "Construction" shall have the meanings set forth in 41 CFR 60-1.3(e) and 23 U.S.C. 101(a). References in both definitions to expenses or functions incidental to construction shall include preliminary engineering work in project development or engineering services performed by or for a SHA;
(h) "Corrective Action Plan" means a contractor's unequivocal written and signed commitment outlining actions taken or proposed, with time limits and goals, where appropriate to correct, compensate for, and remedy each violation of the equal opportunity requirements as specified in a list of deficiencies. (Sometimes called a conciliation agreement or a letter of commitment.);
(i) "Contractor" means, any person, corporation, partnership, or unincorporated association that holds a FHWA direct or federally assisted construction contract or subcontract regardless of tier;
(j) "Days" shall mean calendar days;
(k) "Discrimination" means a distinction in treatment based on race, color, religion, sex, or national origin;
(l) "Equal Employment Opportunity" means the absence of partiality or distinction in employment treatment, so that the right of all persons to work and advance on the basis of merit, ability, and potential is maintained;
(m) "Equal Opportunity Compliance Review" means an evaluation and determination of a nonexempt direct Federal or Federal-aid contractor's or subcontractor's compliance with equal opportunity requirements basedon:
(1) Project work force - employees at the physical location of the construction activity;
(2) Area work force - employees at all Federal-aid, Federal, and non-Federal projects in a specific geographical area as determined under Sec. 230.409 (b)(9); or
(3) Home office work force - employees at the physical location of the corporate, company, or other ownership headquarters or regional managerial, offices, including "white collar" personnel (managers, professionals, technicians, and clericals) and any maintenance or service personnel connected thereto;
(n) "Equal Opportunity Requirements" is a general term used throughout this document to mean all contract provisions relative to equal employment opportunity (EEO), subcontracting, and training;
(o) "Good Faith Effort" means affirmative action measures designed to implement the established objectives of an Affirmative Action Plan;
(p) "Show Cause Notice" means a written notification to a contractor based on the determination of the reviewer (or in appropriate cases by higher level authority) to be in noncompliance with the equal opportunity requirements. The notice informs the contractor of the specific basis for the determination and provides the opportunity, within 30 days from receipt, to present an explanation why sanctions should not be imposed;
(q) "State highway agency" (SHA) means that department, commission, board, or official of any State charged by its laws with the responsibility for highway construction. The term "State" should be considered equivalent to "State highway agency." With regard to direct Federal contracts, references herein to SHA's shall be considered to refer to FHWA regional offices, as appropriate.
Sec. 230.409 Contract compliance review procedures.
(a) General. A compliance review consists of the following elements:
(1) Review Scheduling (Actions R-1 and R-2).
(2) Contractor Notification (Action R-3).
(3) Preliminary Analysis (Phase I) (Action R-4).
(4) Onsite Verification and Interviews (Phase II) (Action R-5).
(5) Exit Conference (Action R-6).
(6) Compliance Determination and Formal Notification (Actions R-8, R-9, R-10, R-11, R-12).
The compliance review procedure, as described herein and in Appendix D provides for continual monitoring of the employment process. Monitoring officials at all levels shall analyze submissions from field offices to ensure proper completion of procedural requirements and to ascertain the effectiveness of program implementation.
(b) Review scheduling. (Actions R-1 and R-2). Because construction work forces are not constant, particular attention should be paid to the proper scheduling of equal opportunity compliance reviews. Priority in scheduling equal opportunity compliance reviews shall be given to reviewing those contractor's work forces:
(1) Which hold the greatest potential for employment and promotion of minorities and women (particularly in higher skilled crafts or occupations);
(2) Working in areas which have significant minority and female labor forces within a reasonable recruitment area;
(3) Working on projects that include special training provisions; and
(4) Where compliance with equal opportunity requirements is questionable. (Based on previous PR-1391's (23 CFR Part 230, Subpart A, Appendix C) Review Reports and Hometown Plan Reports). In addition, the following considerations shall apply:
(5) Reviews specifically requested by the Washington Headquarters shall receive priority scheduling;
(6) Compliance Reviews in geographical areas covered by areawide plans would normally be reviewed under the Consolidated Compliance Review Procedures set forth in Sec. 230.415.
(7) Reviews shall be conducted prior to or during peak employment periods.
(8) No compliance review shall be conducted that is based on a home office work force of less than 15 employees unless requested or approved by Washington Headquarters; and
(9) For compliance reviews based on an area work force (outside of areawide plan coverage), the Compliance Specialist shall define the applicable geographical area by considering:
(i) Union geographical boundaries;
(ii) The geographical area from which the contractor recruits employees, i.e. reasonable recruitment area;
(iii) Standard Metropolitan Statistical Area (SMSA) or census tracts; and
(iv) The county in which the Federal or Federal-aid project(s) is located and adjacent counties.
(c) Contractor notification (Action R-3).
(1) The Compliance Specialist should usually provide written notification to the contractor of the pending compliance review at least 2 weeks prior to the onsite verification and interviews. This notification shall include the scheduled date(s), an outline of the mechanics and basis of the review, requisite interviews, and documents required.
(2) The contractor shall be requested to provide a meeting place on the day of the visit either at the local office of the contractor or at the jobsite.
(3) The contractor shall be requested to supply all of the following information to the Compliance Specialist prior to the onsite verification and interviews.
(i) Current Form PR-1391 developed from the most recent payroll;
(ii) Copies of all current bargaining agreements;
(iii) Copies of purchase orders and subcontracts containing the EEO clause;
(iv) A list of recruitment sources available and utilized;
(v)A statement of the status of any action pertaining to employment practices taken by the Equal Employment Opportunity Commission (EEOC) or other Federal, State, or local agency regarding the contractor or any source of employees;
(vi) A list of promotions made during the past 6 months, to include race, national origin, and sex of employee, previous job held, job promoted into; and corresponding wage rates;
(vii) An annotated payroll to show job classification, race, national origin and sex;
(viii) A list of minority- or female-owned companies contacted as possible subcontractors, vendors, material suppliers, etc.; and
(ix) Any other necessary documents or statements requested by the Compliance Specialist for review prior to the actual onsite visit.
(4) For a project review, the prime contractor shall be held responsible for ensuring that all active subcontractors are present at the meeting and have supplied the documentation listed in Sec. 230.409(c)(3).
(d) Preliminary analysis (Phase I) (Action R-4). Before the onsite verification and interviews, the Compliance Specialist shall analyze the employment patterns, policies, practices, and programs of the contractor to determine whether or not problems exist by reviewing information relative to:
(1) The contractor's current work force;
(2) The contractor's relationship with referral sources, e.g., unions, employment agencies, community action agencies, minority and female organizations, etc.;
(3) The minority and female representation of sources;
(4) The availability of minorities and females with requisite skills in a reasonable recruitment area;
(5) Any pending EEOC or Department of Justice cases or local or State Fair Employment Agency cases which are relevant to the contractor and/or thereferral sources; and
(6) The related projects (and/or contractor) files of FHWA regional or division and State Coordinator's offices to obtain current information relating to the status of the contractor's project(s), value, scheduled duration, written corrective action plans, PR-1391 or Manpower Utilization Reports, training requirements, previous compliance reviews, and other pertinent correspondence and/or reports.
(e) Onsite verification and interviews (Phase II) (Action R-5).
(1) Phase II of the review consists of the construction or home office site visit(s). During the initial meeting with the contractor, the following topics shall be discussed:
(i) Objectives of the visit;
(ii) The material submitted by the contractor, including the actual implementation of the employee referral source system and any discrepancies found in the material; and
(iii) Arrangements for the site tour(s) and employee interviews.
(2) The Compliance Specialist shall make a physical tour of the employment site(s) to determine that:
(i) EEO posters are displayed in conspicuous places in a legible fashion;
(ii) Facilities are provided on a nonsegregated basis (e.g. work areas, washroom, timeclocks, locker rooms, storage areas, parking lots, and drinking fountains);
(iii) Supervisory personnel have been oriented to the contractor's EEO commitments;
(iv) The employee referral source system is being implemented;
(v) Reported employment data is accurate;
(vi) Meetings have been held with employees to discuss EEO policy, particularly new employees; and
(vii) Employees are aware of their right to file complaints of discrimination.
(3) The Compliance Specialist should interview at least one minority, one nonminority, and one woman in each trade, classification, or occupation. The contractor's superintendent or home office manager should also be interviewed.
(4) The Compliance Specialist shall, on a sample basis, determine the union membership status of union employees on the site (e.g. whether they have permits, membership cards, or books, and in what category they are classified [e.g., A, B, or C]).
(5) The Compliance Specialist shall also determine the method utilized to place employees on the job and whether equal opportunity requirements have been followed.
(6) The Compliance Specialist shall determine, and the report shall indicate the following:
(i) Is there reasonable representation and utilization of minorities and women in each craft, classification or occupation? If not, what has the contractor done to increase recruitment, hiring, upgrading, and training of minorities and women?
(ii) What action is the contractor taking to meet the contractual requirement to provide equal employment opportunity?
(iii) Are the actions taken by the contractoracceptable? Could they reasonably be expected to result in increased utilization of minorities and women?
(iv) Is there impartiality in treatment of minorities and women?
(v) Are affirmative action measures of an isolated nature or are they continuing?
(vi) Have the contractor's efforts produced results?
(f) Exit conference (Action R-6).
(1) During the exit conference with the contractor, the following topics shall be discussed:
(i) Any preliminary findings that, if not corrected immediately or not corrected by the adoption of an acceptable voluntary corrective action plan, would necessitate a determination of noncompliance;
(ii) The process and time in which the contractor shall be informed of the final determination (15 days following the onsite verification and interviews); and
(iii) Any other matters that would best be resolved before concluding the onsite portion of the review.
(2) Voluntary corrective action plans may be negotiated at the exit conference, so that within 15 days following the exit portion of the review, the Compliance Specialist shall prepare the review report and make a determination of either:
(i) Compliance, and so notify the contractor; or
(ii) Noncompliance, and issue a 30-day show cause notice.
The acceptance of a voluntary corrective action plan at the exit conference does not preclude a determination of noncompliance, particularly if deficiencies not addressed by the plan are uncovered during the final analysis and report writing. (Action R-7) A voluntary corrective action plan should be accepted with the understanding that it only address those problems uncovered prior to the exit conference.
(g) Compliance determinations (Action R-8).
(1) The evidence obtained at the compliance review shall constitute a sufficient basis for an objective determination by the Compliance Specialist conducting the review of the contractor's compliance or noncompliance with contractual provisions pursuant to E.O. 11246, as amended, and FHWA EEO Special Provisions implementing the Federal-Aid Highway Act of 1968, where applicable.
(2) Compliance determinations on contractors working in a Hometown Plan Area shall reflect the status of those crafts covered by Part II of the plan bid conditions. Findings regarding Part I crafts shall be transmitted through channels to the WashingtonHeadquarters, Office of Civil Rights.
(3) The compliance status of the contractor will usually be reflected by positive efforts in the following areas:
(i) The contractor's equal employment opportunity (EEO) policy;
(ii) Dissemination of the policy and education of supervisory employees concerning their responsibilities in implementing the EEO policy;
(iii) The authority and responsibilities of the EEO officer;
(iv) The contractor's recruitment activities, especially establishing minority and female recruitment and referral procedures;
(v) The extent of participation and minority and female utilization in FHWA training programs;
(vi) The contractor's review of personnel actions to ensure equal opportunities;
(vii) The contractor's participation in apprenticeship or other training;
(viii) The contractor's relationship (if any) with unions and minority and female union membership;
(ix) Effective measures to assure nonsegregated facilities, as required by contract provisions;
(x) The contractor's procedures for monitoring subcontractors and utilization of minority and female subcontractors and/or subcontractors with substantial minority and female employment; and
(xi) The adequacy of the contractor's records and reports.
(4) A contractor shall be considered to be in compliance (Action R-9) when the equal opportunity requirements have been effectively implemented, or there is evidence that every good faith effort has been made toward achieving this end. Efforts to achieve this goal shall be result-oriented, initiated and maintained in good faith, andemphasized as any other vital management function.
(5) A contractor shall be considered to be in noncompliance (Action R-10) when:
(i) The contractor has discriminated against applicants or employees with respect to the conditions or privileges of employment; or
(ii) The contractor fails to provide evidence of every good faith effort to provide equal opportunity.
(h) Show cause procedures
(1) General. Once the onsite verification and exit conference (Action R-5) have been completed and a compliance determination made, (Action R-8), the contractor shall be notified in writing of the compliance determination. (Action R-11 or R-12) This written notification shall be sent to the contractor within 15 days following the completion of the onsite verification and exit conference. If a contractor is found in noncompliance (Action R-10), action efforts to bring the contractor into compliance shall be initiated through the issuance of a show cause notice (Action R-12). The notice shall advise the contractor to show cause within 30 days why sanctions should not be imposed.
(2) When a show cause notice is required. A show cause notice shall be issued when a determination of noncompliance is made based upon:
(i) The findings of a compliance review;
(ii) The results of an investigation which verifies the existence of discrimination; or
(iii) Areawide plan reports that show an underutilization of minorities (based oncriteria of U.S. Department of Labor's Optional Form 66 "Manpower Utilization Report") throughout the contractor's work force covered by Part II of the plan bid conditions.
(3) Responsibility for issuance.
(i) Show cause notices will normally be issued by SHA's to federally assisted contractors when the State has made a determination of noncompliance, or when FHWA has made such a determination and has requested the State toissue the notice.
(ii) When circumstances warrant, the Regional Federal Highway Administrator or a designee may exercise primary compliance responsibility by issuing the notice directly to the contractor.
(iii) The Regional Federal Highway Administrators in Regions 8, 10, and the Regional Engineer in Region 15, shall issue show cause notices to direct Federal contractors found in noncompliance.
(4) Content of show cause notice. The show cause notice must: (See sample - Appendix A of this subpart)
(i) Notify the contractor of the determination of noncompliance;
(ii) Provide the basis for the determination of noncompliance;
(iii) Notify the contractor of the obligation to show cause within 30 days why formal proceedings should not be instituted;
(iv) Schedule (date, time, and place) a compliance conference to be held approximately 15 days from the contractor's receipt of the notice;
(v) Advise the contractor that the conference will be held to receive and discuss the acceptability of any proposed corrective action plan and/or correction of deficiencies; and
(vi) Advise the contractor of the availability and willingness of the Compliance Specialist to conciliate within the time limits of the show cause notice.
(5) Preparing and processing the show cause notice.
(i) The State or FHWA official who conducted the investigation or review shall develop complete background data for the issuance of the show cause notice and submit the recommendation to the head of the SHA or the Regional Federal Highway Administrator, as appropriate.
(ii) The recommendation, background data, and final draft notice shall be reviewed by appropriate State or FHWA legal counsel.
(iii) Show cause notices issued by the SHA shall be issued by the head of that agency or a designee.
(iv) The notice shall be personally served to the contractor or delivered by certified mail, return receipt requested, with a certificate of service or the return receipt filed with the case record.
(v) The date of the contractor's receipt of the show cause notice shall begin the 30-day show cause period. (Action R-13).
(vi) The 30-day show cause notice shall be issued directly to the noncompliant contractor or subcontractor with an informational copy sent to any concerned prime contractors.
(6) Conciliation efforts during show cause period.
(i) The Compliance Specialist is required to attempt conciliation with the contractor throughout the show cause time period. Conciliation and negotiation efforts shall be directed toward correcting contractor program deficiencies and initiating corrective action which will maintain and assure equal opportunity. Records shall be maintained in the State, FHWA division, or FHWA regional office's case files, as appropriate, indicating actions and reactions of the contractor, a brief synopsis of any meetings with the contractor, notes on verbal communication and written correspondence, requests for assistance or interpretations, and other relevant matters.
(ii) In instances where a contractor is determined to be in compliance after a show cause notice has been issued, the show cause notice will be rescinded and the contractor formally notified (Action R-17). The FHWA Washington Headquarters, Office of Civil Rights, shall immediately be notified of any change in status.
(7) Corrective action plans.
(i) When a contractor is required to show causeand the deficiencies cannot be corrected within the 30-day show cause period, a written corrective action plan may be accepted. The written corrective action plan shall specify clear unequivocal action by the contractor with time limits for completion. Token actions to correct cited deficiencies will not be accepted. (See Sample Corrective Action Plan - Appendix B of this subpart)
(ii) When a contractor submits an acceptable written corrective action plan, the contractor shall be considered in compliance during the plan's effective implementation and submission of required progress reports. (Action R-15 and R-17).
(iii) When an acceptable corrective action plan is not agreed upon and the contractor does not otherwise show cause as required, the formal hearing process shall be recommended through appropriate channels by the compliance specialist immediately upon expiration of the 30-day show cause period. (Action R-16, R-18, R-19)
(iv) When a contractor, after having submitted an acceptable corrective action plan and being determined in compliance is subsequently determined to be in noncompliance based upon the contractor's failure to implement the corrective action plan, the formal hearing process must be recommended immediately. There are no provisions for reinstituting a show cause notice.
(v) When, however, a contractor operating under an acceptable corrective action plan carries out the provisions of the corrective action plan but the actions do not result in the necessary changes, the corrective action plan shall be immediately amended through negotiations. If, at this point, the contractor refuses to appropriately amend the corrective action plan, the formal hearing process shall be recommended immediately.
(vi) A contractor operating under an approved voluntary corrective action plan (i.e. plan entered into prior to the issuance of a show cause) must be issued a 30-day show cause notice in the situations referred to in paragraphs (h)(7)(iv) and (v) of thissection, i.e., failure to implement an approved corrective action plan or failure of corrective actions to result in necessary changes.
(i) Followup reviews.
(1) A followup review is an extension of the initial review process to verify the contractors performance of corrective action and to validate progress report information. Therefore, followup reviews shall only be conducted of those contractors where the initial review resulted in a finding of noncompliance and a show cause notice was issued.
(2) Followup reviews shall be reported as a narrative summary referencing the initial review report.
(j) Hearing process.
(1) When such procedures as show cause issuance and conciliation conferences have been unsuccessful in bringing contractors into compliance within the prescribed 30 days, the reviewer (or other appropriate level) shall immediately recommend, through channels, that the Department of Transportation obtain approval from the Office of Federal Contract Compliance Programs for a formal hearing (Action R-19). The Contractor should be notified of this action.
(2) Recommendations to the Federal Highway Administrator for hearing approval shall be accompanied by full reports of findings and case files containing any related correspondence. The following items shall be included with the recommendation:
(i) Copies of all Federal and Federal-aid contracts and/or subcontracts to which the contractor is party;
(ii) Copies of any contractor or subcontractor certifications;
(iii) Copy of show cause notice;
(iv) Copies of any corrective action plans; and
(v) Copies of all pertinent Manpower Utilization Reports, if applicable.
(3) SHA's through FHWA regional and division offices,will be advised of decisions and directions affecting contractors by the FHWA Washington Headquarters, Office of Civil Rights, for the Department of Transportation.
(k) Responsibility determinations.
(1) In instances where requests for formal hearings are pending OFCCP approval, the contractor may be declared a nonresponsible contractor for inability to comply with the equal opportunity requirements.
(2) SHA's shall refrain from entering into any contract or contract modification subject to E.O. 11246, as amended, with a contractor who has not demonstrated eligibility for Government contracts and federally assisted construction contracts pursuant to E.O. 11246, as amended.
Sec. 230.411 Guidance for conducting reviews.
(a) Extensions of time. Reasonable extensions of time limits set forth in these instructions may be authorized by the SHA's or the FHWA regional office, as appropriate. However, all extensions are subject to Washington Headquarters approval and should only be granted with this understanding. The Federal Highway Administrator shall be notified of all time extensions granted and the justification therefor. In sensitive or special interest cases, simultaneous transmittal of reports and other pertinent documents is authorized.
(b) Contract completion. Completion of a contract or seasonal shutdown shall not preclude completion of the administrative procedures outlined herein or the possible imposition of sanctions or debarment.
(c) Home office reviews outside regions. When contractor's home offices are located outside the FHWA region in which the particular contract is being performed, and it is determined that the contractors' home offices should be reviewed, requests for such reviews with accompanying justification shall be forwarded through appropriate channels to the Washington Headquarters, Office of Civil Rights. After approval, the Washington Headquarters, Office of Civil Rights, (OCR) shall request the appropriate region to conduct the home office review.
(d) Employment of women. Executive Order 11246, as amended, implementing rules and regulations regarding sex discrimination are outlined in 41 CFR Part 60-20. It is the responsibility of the Compliance Specialist to ensure that contractors provide women fullparticipation in their work forces.
(e) Effect of exclusive referral agreements.
(1) The OFCCP has established the following criteria for determining compliance when an exclusive referral agreement is involved;
(i) It shall be no excuse that the union, with which the contractor has a collective bargaining agreement providing for exclusive referral, failed to refer minority or female employees.
(ii) Discrimination in referral for employment, even if pursuant to provisions of a collective bargaining agreement, is prohibited by the National Labor Relations Act and Title VII of the Civil Rights Act of 1964, as amended.
(iii) Contractors and subcontractors have a responsibility to provide equal opportunity if they want to participate in federally involved contracts. To the extent they have delegated the responsibility for some of their employment practices to some other organization or agency which prevents them from meeting their obligations, these contractors must be found in noncompliance.
(2) If the contractor indicates that union action or inaction is a proximate cause of the contractor's failure to provide equal opportunity, a finding of noncompliance will be made and a show cause notice issued, and:
(i) The contractor will be formally directed to comply with the equal opportunity requirements.
(ii) Reviews of other contractors with projects within the jurisdiction of the applicable union locals shall be scheduled.
(iii) If the reviews indicate a pattern and/or practice of discrimination on the part of specific union locals, each contractor in the area shall be informed of the criteria outlined in Sec. 230.411(e)(1) of this section. Furthermore, the FHWA WashingtonHeadquarters, OCR, shall be provided with full documentary evidence to support the discriminatory pattern indicated.
(iv) In the event the union referral practices prevent the contractor from meeting the equal opportunity requirements pursuant to the E.O. 11246, as amended, such contractor shall immediately notify the SHA.
Sec. 230.413 Review reports.
(1) The Compliance Specialist shall maintain detailed notes from the beginning of the review from which a comprehensive compliance review report can be developed.
(2) The completed compliance review report shall contain documentary evidence to support the determination of a contractor's or subcontractor's compliance status.
(3) Findings, conclusions, and recommendations shall be explicitly stated and, when necessary, supported by documentary evidence.
(4) The compliance review report shall contain at least the following information. (The Federal Highway Administration will accept completed Form FHWA-86 for the purpose. The form is available at the offices listed in 49 CFR Part 7, Appendix D.) (Action R-20)
(i) Complete name and address of contractor.
(ii) Project(s) identification.
(iii) Basis for the review, i.e. area work force, project work force, home office work force, and target area work force.
(iv) Identification of Federal or Federal-aid contract(s).
(v) Date of review.
(vi) Employment data by job craft, classification, or occupation by race and sex in accordance with (iii) above. This shall be the data verified during the onsite.
(vii) Identification of local unions involved with contractor, when applicable.
(viii) Determination of compliance status: compliance or noncompliance.
(ix) Copy of show cause notice or compliance notification sent to contractor.
(x) Name of the Compliance Specialist who conducted the review and whether that person is a State, division or regional Compliance Specialist.
(xi) Concurrences at appropriate levels.
(5) Each contractor (joint venture is one contractor) will be reported separately. When a project review is conducted, the reports should be attached, with the initial report being that of the prime contractor followed by the reports of each subcontractor.
(6) Each review level is responsible for ensuring that required information is contained in the report.
(7) When a project review is conducted, the project work force shall be reported. When an areawide review is conducted (all Federal-aid, Federal, and non-Federal projects in an area), then areawide work force shall be reported. When a home office review is conducted, only home office work force shall be reported. Other information required by regional offices shall be detached before forwarding the reports to the Washington Headquarters, OCR.
(8) The Washington Headquarters, OCR, shall be provided all of the following:
(i) The compliance review report required by Sec. 230. 413(a)(4).
(ii) Corrective action plans.
(iii) Show cause notices or compliance notifications.
(iv) Show cause rescissions.
While other data and information should be kept by regional offices (including progress reports, correspondence, and similar review backup material), it should not be routinely forwarded tothe Washington Headquarters, OCR.
(b) Administrative requirements
(1) State conducted reviews.
(i) Within 15 days from the completion of the onsite verification and exit conference, the State Compliance Specialist will:
(A) Prepare the compliance review report, based on information obtained;
(B) Determine the contractor's compliance status;
(C) Notify the contractor of the compliance determination, i.e., send the contractor either notification of compliance or show cause notice; and
(D) Forward three copies of the compliance review report, and the compliance notification or show cause notice to the FHWA division EEO Specialist.
(ii) Within 10 days of receipt, the FHWA division EEO Specialist shall:
(A) Analyze the State's report, ensure that it is complete and accurate;
(B) Resolve nonconcurrence, if any;
(C) Indicate concurrence, and, where appropriate, prepare comments; and
(D) Forward two copies of the compliance review report, and the compliance notification or show cause notice to the Regional Civil Rights Director.
(iii) Within 15 days of receipt, the FHWA Regional Civil Rights Director shall:
(A) Analyze the report, ensure that it is complete and accurate;
(B) Resolve nonconcurrence, if any;
(C) Indicate concurrence, and, where appropriate, prepare comments; and
(D) Forward one copy of the compliancereview report, and the compliance notification or show cause notice to the Washington Headquarters, OCR.
(2) FHWA division conducted reviews.
(i) Within 15 days from the completion of the onsite verification and exit conference, the division EEO Specialist shall:
(A) Prepare compliance review report, based on information obtained;
(B) Determine the contractor's compliance status;
(C) Notify the State to send the contractor the compliance determination, i.e. either notification of compliance or show cause notice; and
(D) Forward two copies of the compliance review report and the compliance notification or show cause notice to the Regional Civil Rights Director.
(ii) Within 15 days of receipt, the FHWA Regional Civil Rights Director will take the steps outlined in Sec. 230.413(b)(1)(iii).
(3) FHWA region conducted reviews.
(i) Within 15 days from the completion of the onsite verification and exit conference the regional EEO Specialist shall:
(A) Prepare the compliance review report, based on information obtained;
(B) Determine the contractor's compliance status;
(C) Inform the appropriate division to notify the State to send the contractor the compliance determination i.e. either notification of compliance or show cause notice; and
(D) Forward one copy of the compliance review report, and the compliance notification or show cause notice to the Washington Headquarters, OCR.
(4) Upon receipt of compliance review reports, theWashington Headquarters, OCR, shall review, resolve any nonconcurrences, and record them for the purpose of:
(i) Providing ongoing technical assistance to FHWA regional and division offices and SHA's;
(ii) Gathering a sufficient data base for program evaluation;
(iii) Ensuring uniform standards are being applied in the compliance review process;
(iv) Initiating appropriate changes in FHWA policy and implementing regulations; and
(v) Responding to requests from the General Accounting Office, Office of Management and Budget, Senate Subcommittee on Public Roads, and other agencies and organizations.
Sec. 230.415 Consolidated compliance reviews.
(a) General. Consolidated compliance reviews shall be implemented to determine employment opportunities on an areawide rather than an individual project basis. The consolidated compliance review approach shall be adopted and directed by either Headquarters, region, division, or SHA, however, consolidated reviews shall at all times remain a cooperative effort.
(b) OFCCP policy requires contracting agencies to ensure compliance, in hometown an imposed plan areas, on an areawide rather than a project basis. The consolidated compliance review approach facilitates implementation of this policy.
(1) Selection of a target area. In identifying the target area of a consolidated compliance review (e.g. SMSA, hometown or imposed plan area, a multicounty area, or an entire State), consideration shall at least be given to the following facts:
(i) Minority and female work force concentrations;
(ii) Suspected or alleged discrimination in union membership or referral practices by local unions involved in highway construction;
(iii) Present or potential problem areas;
(iv) The number of highway projects in the target area; and
(v) Hometown or imposed plan reports that indicate underutilization of minorities or females.
(2) Determine the review period. After the target area has been selected, the dates for the actual onsite reviews shall be established.
(3) Obtain background information. EEO-3's Local Union Reports, should be obtained from regional offices of the EEOC. Target area civilian labor force statistics providing percent minorities and percent females in the target area shall be obtained from State employment security agencies or similar State agencies.
(4) Identify contractors. Every nonexempt federally assisted or direct Federal contractor and subcontractor in the target area shall be identified. In order to establish areawide employment patterns in the target area, employment data is needed for all contractors and subcontractors in the area. However, only those contractors with significant work forces (working prior to peak and not recently reviewed) may need to be actually reviewed onsite. Accordingly, once all contractors are identified, those contractors which will actually be reviewed onsite shall be determined. Compliance determinations shall only reflect the status of crafts covered by Part II of plan bid conditions. Employment data of crafts covered by Part I of plan bid conditions shall be gathered and identified as such in the composite report, however, OFCCP has reserved the responsibility for compliance determinations on crafts covered by Part I of the plan bid conditions.
(5) Contractor notification. Those contractors selected for onsite review shall be sent a notification letter as outlined in Sec. 230.409(c) along with a request for current workforce data (The Consolidated Workforce Questionnaire is convenient for the purpose and appears as Attachment 4 to Volume 2, Chapter 2, Section 3 of the Federal-Aid Highway Program Manual, which is available at the offices listed in 49 CFR Part 7, Appendix D.) for completion and submission at the onsite review. Those contractors in the targetarea not selected for onsite review shall also be requested to supply current workforce data as of the onsite review period, and shall return the data within 15 days following the onsite review period.
(6) Onsite reviews. Compliance reviews shall then be conducted in accordance with the requirements set forth in Sec. 230.409. Reviewers may use Form FHWA-86, Compliance Data Report, if appropriate. It is of particular importance during the onsite reviews that the review team provide for adequate coordination of activities at every stage of the review process.
(7) Compliance determinations. Upon completion of the consolidated reviews, compliance determinations shall be made on each review by the reviewer. Individual show cause notices or compliance notifications shall be sent (as appropriate) to each reviewed contractor. The compliance determination shall be based on the contractor"s target area work force (Federal, Federal-aid and non-Federal), except when the target area is coincidental with hometown plan area, compliance determinations must not be based on that part of a contractor"s work force covered by Part I of the plan bid conditions, as previously set forth in this regulation. For example: ABC Contracting, Inc. employs carpenters, operating engineers, and cement masons. Carpenters and operating engineers are covered by Part II of the plan bid conditions, however, cement masons are covered by Part I of the plan bid conditions. The compliance determination must be based only on the contractor"s utilization of carpenters and operating engineers.
(1) Composite report. A final composite report shall be submitted as a complete package to the Washington Headquarters, OCR, within 45 days after the review period and shall consist of the following:
(i) Compliance review report, for each contractor and subcontractor with accompanying show cause notice or compliance notification.
(ii) Work force data to show the aggregate employment of all contractors in the target area.
(iii) A narrative summary of findings and recommendations to include the following:
(A) A summary of highway construction employment in the target area by craft, race, and sex. This summary should explore possible patterns of discrimination or underutilization and possible causes, and should compare the utilization of minorities and females on contractor"s work forces to the civilian labor force percent for minorities and females in the target area.
(B) If the target area is a plan area, a narrative summary of the plan"s effectiveness with an identification of Part I and Part II crafts. This summary shall discuss possible differences in minority and female utilization between Part I and Part II crafts, documenting any inferences drawn from such comparisons.
(C) If applicable, discuss local labor unions" membership and/or referral practices that impact on the utilization of minorities and females in the target area. Complete and current copies of all collective bargaining agreements and copies of EEO-3, Local Union Reports, for all appropriate unions shall accompany the composite report.
(D) Any other appropriate data, analyses, or information deemed necessary for a complete picture of the areawide employment.
(E) Considering the information compiled from the summaries listed above, make concrete recommendations on possible avenues for correcting problems uncovered by the analyses.
(2) Annual planning report. The proper execution of consolidated compliance reviews necessitates scheduling, along with other fiscal program planning. The Washington Headquarters, OCR, shall be notified of all planned consolidated reviews by August 10 of each year and of any changes in the target area or review periods, as they become known. The annual consolidated planning reportshall indicate:
(i) Selected target areas:
(ii) The basis for selection of each area; and
(iii) The anticipated review period (dates) for each target area.
Certified Mail, Return Receipt Requested
City, State, and Zip Code.
Dear Contractor: As a result of the review of your (Project Number) project located at (Project Location) conducted on (Date) by (Reviewing Agency), it is our determination that you are not in compliance with your equal opportunity requirements and that good faith efforts have not been made to meet your equal opportunity requirements in the following areas:
List of Deficiencies
Your failure to take the contractually required affirmative action has contributed to the unacceptable level of minority and female employment in your operations, particularly in the semiskilled and skilled categories of employees.
The Department of Labor regulations (41 CFR 60) implementing Executive Order 11246, as amended, are applicable to your Federal-aid highway construction contract and are controlling in this matter (see Required Contract Provisions, Form PR-1273, Clause II). Section 60-1.20(b) of these regulations provides that when equal opportunity deficiencies exist, it is necessary that you make a commitment in writing to correct such deficiencies before you may be found in compliance. The commitment must include the specific action which you propose to take to correct each deficiency and the date of completion of such action. The time period allotted shall be no longer than the minimum period necessary to effect the necessary correction. In accordance with instructions issued by the Office of Federal Contract Compliance Programs (OFCCP), U.S. Department of Labor, your written commitment must also provide for the submission of monthly progress reports which shall include a head count of minority and female representation at each level of each trade and a list of minority employees.
You are specifically advised that making the commitment discussed above will not preclude a further determination of noncompliance upon a finding that the commitment is not sufficient to achieve compliance.
We will hold a compliance conference at ______________ (Address) at ______________ (Time) on ______________ (Date) for you to submit and discuss your written commitment. If your written commitment is acceptable and if the commitment is sufficient to achieve compliance, you will be found in compliance during theeffective implementation of that commitment. You are cautioned, however, that our determination is subject to review by the Federal Highway Administration, the Department of Transportation, and OFCCP and may be disapproved if your written commitment is not considered sufficient to achieve compliance.
If you indicate either directly or by inaction that you do not wish to participate in the scheduled conference and do not otherwise show cause within 30 days from receipt of this notice why enforcement proceedings should not be instituted, this agency will commence enforcement proceedings under Executive Order 11246, as amended.
If your written commitment is accepted and it is subsequently found that you have failed to comply with its provisions, you will be advised of this determination and formal sanction proceedings will be instituted immediately.
In the event formal sanction proceedings are instituted and the final determination is that a violation of your equal opportunity contract requirements has taken place, any Federal-aid highway construction contracts or subcontracts which you hold may be canceled, terminated, or suspended, and you may be debarred from further such contracts or subcontracts. Such other sanctions as are authorized by Executive Order 11246, as amended, may also be imposed.
We encourage you to take whatever action is necessary to resolve this matter and are anxious to assist you in achieving compliance. Any questions concerning this notice should be addressed to (Name, Address, and Phone).
[41 FR 34245, Aug. 13, 1976]
Deficiency 1: Sources likely to yield minority employees have not been contacted for recruitment purposes.
Commitment: We have developed a system of written job applications at our home office which readily identifies minority applicants. In addition to this, as a minimum, we will contact the National Association for the Advancement of Colored People (NAACP), League of Latin American Citizens (LULAC), Urban League, and the Employment Security Office within 20 days to establish a referral system for minority group applicants and expand our recruitment base. We are in the process of identifying other community organizations and associations that may be able to provide minority applicants and will submit an updated listing of recruitment sources and evidence of contact by ______________ (Date).
Deficiency 2: There have been inadequate efforts to locate, qualify, and increase skills of minority and female employees and applicants for employment.
Commitment: We will set up an individual file for each apprentice or trainee by _____________ (Date) in order to carefully screen the progress, ensure that they are receiving the necessary training, and being promoted promptly upon completion of training requirements. We have established a goal of at least 50 percent of our apprentices and trainees will be minorities and 15 percent will be female. In addition to the commitment made to deficiency number 1, we will conduct a similar identification of organizations able to supply female applicants. Based on our projected personnel needs, we expect to have reached our 50 percent goal for apprentices and trainees by ____________ (Date).
Deficiency 3: Very little effort to assure subcontractors have meaningful minority group representation among their employees.
Commitment: In cooperation with the Regional Office of Minority Business Enterprise, Department of Commerce, and the local NAACP, we have identified seven minority-owned contractors that may be able to work on future contracts we may receive. These contractors (identified in the attached list) will be contacted prior to our bidding on all future contracts. In addition, we have scheduled a meeting with all subcontractors currently working on our contracts. This meeting will be held to inform the subcontractors of our intention to monitor their reports and require meaningful minority representation. This meeting will be held on ____________ (Date) and we will summarize the discussions and current posture of each subcontractor for your review by _________ (Date) Additionally, as requested, we will submit a PR-1391 on ______________ (Date), _____________ (Date), _______________ (Date). Finally, we have committed ourselves tomaintaining at least 20 percent minority and female representation in each trade during the time we are carrying out the above commitments. We plan to have completely implemented all the provisions of these commitments by _________ (Date).
[41 FR 34245, Aug. 13, 1976]
Certified Mail, Return Receipt Requested
City, State, and Zip Code
Dear Contractor: On ___________, (Date) you received a 30-day show cause notice from this office for failing to implement the required contract requirements pertaining to equal employment opportunity.
Your corrective action plan, discussed and submitted at the compliance conference held on _____________ (Date), has been reviewed and determined to be acceptable. Your implementation of your corrective action plan shows that you are now taking the required affirmative action and can be considered in compliance with Executive Order 11246, as amended. If it should later be determined that your corrective action plan is not sufficient to achieve compliance, this Rescission shall not preclude a subsequent finding of noncompliance.
In view of the above, this letter is to inform you that the 30-day show cause notice of ____________ (Date) is hereby rescinded. You are further advised that if it is found that you have failed to comply with the provisions of your corrective action plan, formal sanction proceedings will be instituted immediately.