As previously indicated, COs will have requested data on the hires, promotions and transfers into jobs at, above and below the level where the participation of nonfavored group members declines. COs will review this data to determine which methods the corporation used to fill jobs at each grade/level during the data period and then conduct the appropriate analysis. Although the process of analysis is essentially the same as for any review, there are certain elements that are unique to CMCEs. The following subsections discuss the CMCE-specific factors COs may need to incorporate into the analysis. These factors apply whether the contractor fills the positions in question externally or internally.
The basics of conducting a hire or promotion analysis are not re-addressed here. However, where additional clarification is needed, these subsections include sample questions and analytical guidance. These sample questions should be viewed as guides for COs on information to research and consider for inclusion in the interview outline or used as actual questions to be asked of the contractor and its employees.
4H00 General Qualification Standards
Corporate officials may cite any number of factors in describing what background and characteristics they look for in candidates for management positions. Among the factors may be a degree in a particular subject area or having an advanced degree, tenure with the corporation, successful profit and loss experience, international stints, and broad knowledge of the business or corporation. Whatever factors the contractor cites, COs must ask sufficient follow-up questions during interviews to thoroughly define the factors and to determine why the corporation believes the factors are important to the specific jobs, and how the corporation believes people acquire or could acquire such characteristics. Below are some follow-up lines of questions for several common factors contractors use. This is not an exhaustive list of questions or lines of inquiry and should only be used as a guide to develop a comprehensive Interview Plan tailored to each witness.
- If the contractor views advanced or specialized degrees as important for a specific management position or level of management, COs could ask follow-up questions in these areas:
- What level or in what field(s) must the degree be? For which position(s)? Why?
- How important is a specific college or university? Why?
- Can a person earn an advanced degree while employed? After hours only? Are there any corporate sponsored degree or continuing education programs? How do these programs operate?
- If the contractor views time with the corporation as important, COs could ask follow-up questions in these areas:
- How much corporate service is typical for employees at and above the management level where nonfavored group participation declines?
- Do employees usually earn this corporate service in a specific sector(s) of the corporation? If so, why?
- If successful profit and loss responsibility is important, COs could ask follow-up questions in these areas:
- Why is it important to the particular management job or group of jobs?
- Are there particular areas of the business in which one is most likely to gain that experience? Least likely?
- At what management level does one usually gain it? Does this differ among business areas?
- Is the number of profit and loss centers increasing, decreasing or remaining about the same?
- If international stints are important, COs could ask follow-up questions in these areas:
- What is the value of having a previous international assignment? Are the number of these assignments and their duration factors?
- How are people selected for these opportunities?
- If the contractor views exposure to different facets of the business as critical, COs could ask follow-up questions in these areas:
- Why is it important?
- Does this requirement encompass particular business sectors and does the contractor consider exposure to certain sectors more valuable than others? How much “exposure” is required? Why?
- How do employees learn that such exposure is important to advancement?
- How do employees obtain such exposure?
Likewise, interviewed employees may cite any number of factors as important to advancement, which may or may not match the factors cited by management. When disparities exist, COs must consider additional sources of information, such as personnel files of individuals actually promoted into the position(s) in question. Beyond basic elements such as advanced degrees, COs should explore how employees acquire the characteristics needed to become managers, with particular attention to any corporate practices that may be informal, such as mentoring, networking, high visibility special projects or rotational assignments.
Whether formal or informal, COs must also consider selection procedures for these programs as part of the analysis. Again, COs must be sure to ask for any documentation regarding the qualification standards for the jobs he or she is examining, and any continuing education, mentoring or similar corporate program. This documentation may include, but is not limited to, personnel handbooks, job announcements, memos, participant lists and emails.
4H01 External Hires
When externally filling management jobs, particularly higher level management jobs, contractors frequently opt not to use conventional recruitment sources such as newspaper or trade publication advertising, but rather use executive search firms or informal referrals from current executive level employees, or both.
While filling a job by hire, including by using search firms or informal referrals, rather than by promotion or transfer, does not in itself violate any of the laws OFCCP enforces, COs must be alert to any evidence or external hiring patterns that indicate that the decision to hire from the outside discriminates on the basis of a prohibited factor.
4H02 Sources of Applicants and Candidates
Contractors may use various sources for hiring middle and senior-level managers. These sources may include executive search firms and referrals from employees.
a. Executive Search Firms. As part of the CMCE, COs must determine the sources of the applicants and candidates for the managerial position(s) they are evaluating, and examine the relationship the contractor has with these sources.
- Types of Search Firms. A contractor may maintain several different types of arrangements with executive search firms. Below are just three examples.
- Firm on retainer. In this arrangement, the employer usually has a contract with the search firm under which the contractor pays the firm a basic fee for its services, with that fee supplemented for each referral hired. This type of arrangement is more common for professional or entry-management positions where the employer anticipates a continuing need for hires in certain fields, or at certain levels where there is a skills shortage internally, externally or both.
- Firm on contingency. In this arrangement, the firm is usually paid a fee only if a candidate it refers is hired. This type of arrangement is more common for middle to upper-level management jobs and contractors may prefer this when they only occasionally hire from outside.
- Unsolicited Referrals. Contractors may sometimes hire from among unsolicited referrals from an executive search firm. In this arrangement, the firm is paid a fee only if the candidate is hired.
- EEO and Affirmative Action Obligations in Referrals. Contractors, under the equal opportunity clauses in their contracts, retain responsibility for ensuring that solicitations for employees placed on its behalf by a search firm or other referral source comport with all of the contractor’s EEO and affirmative action obligations.
Consistent with those clauses, as well as with its obligation to incorporate the equal opportunity clauses in its subcontracts, the contractor is urged to notify the search firm of its EO obligations including that the firm, in seeking candidates on its behalf, must actively seek to include qualified members of diverse groups among those recruited and referred for listed jobs.
- Monitoring Referrals: Contractors using search firms must monitor referrals received by sex, minority group and, when possible, protected veteran and disability status as part of its internal auditing and reporting systems under 41 CFR 60-2.17(d), 60-300.44(h) and 60-741.44(h). A contractor should ask its search firm how it locates and selects candidates if the search firm fails to refer women, minorities, individuals with disabilities or protected veterans.
A contractor is not relieved of its obligations related to recruitment by using a search firm; it must ensure that any firm acting as its agent carries out the contractor’s affirmative action and nondiscrimination obligations.
b. Employee Referrals: Contractors may use employee referrals as a source for new hires. However, as with search firms, the use of employee referrals does not relieve a contractor of its obligations related to recruitment. For example, if a contractor has established a goal for a job group and the contractor relies on employee referrals to recruit that group, the contractor could make clear to employees that it desires referrals of a diverse group of qualified candidates. The contractor might also supplement employee referrals with other sources of qualified applicants for the jobs involved, such as by seeking referrals from organizations that focus on providing services to minorities, women, individuals with disabilities or protected veterans.
A contractor’s exclusive use of employee referrals may be discriminatory where there is evidence that the intent behind that reliance is to exclude underrepresented group members from consideration for certain jobs. Reliance on employee referrals may also be discriminatory when such reliance has an adverse impact on a particular sex, race or ethnic group, and is not job-related and consistent with business necessity.
4H03 Sample Questions and Analysis for Various Search Sources
If, in the course of a CMCE, a CO finds that a particular search firm may be discriminating in its recruitment or referral practices, he or she must inform his or her supervisor. As appropriate, OFCCP coordinates with EEOC to investigate the executive search firm under Title VII, as amended and Title I of the Americans with Disabilities Act of 1990 (ADA), as amended. These laws cover the referral and employment practices of employment agencies. Moreover, if a contractor knowingly uses a search firm that discriminates, the contractor will be found in violation of the applicable law(s) enforced by OFCCP.
A CO engaged with a contractor using an executive search firm may want to ask several questions to understand that relationship. Some sample question areas for the contractor are below.
- Have you used executive or other search firms? When and how often? Which firms do you use most? Identify the positions or types of positions (e.g., fields, levels) for which you have used search firms?
- Have you informed those firms of your EEO/Affirmative Action policy? How? When?
- Who is responsible for monitoring search firm referrals to ensure that the firm complies with EEO and affirmative action requirements? How is monitoring accomplished?
- What is the demographic composition (race, ethnicity, sex, disability and protected veteran status) of those who the contractor hired from among search firm referrals? What efforts did the search firm make to ensure a diverse candidate pool?
COs must conduct an analysis of the information and data received from contractors on their sources of applicants and candidates. For each job filled with a referral from a search firm, the CO should determine, when possible:
- The qualifications the search firm used to refer a candidate;
- The extent to which the contractor approved these qualifications or the amount of input the contractor had in the process to refer a candidate;
- The total pool of candidates who met the requirements to be referred, by race, ethnicity, sex, disability and protected veteran status, and the total number of applicants actually referred by race, ethnicity, sex, disability and protected veteran status;
- The status of the selectee as a member of an underrepresented group;
- The presence of members of underrepresented groups among the referrals made by the search firm;
- The existence of members of underrepresented groups as applicants for the job from other external sources; and
- The existence of internal candidates for the job identified by race, ethnicity, sex, disability and protected veteran status.
A CO engaged with a contractor using employee referrals may want to ask several questions to understand that process. Some sample question areas for the contractor are below.
- How much, or to what degree, do you rely upon employee referrals for middle and senior-level management positions? Is this practice formal or informal?
- What is the typical relationship between the employee making the referral and the person being referred (e.g., used to work together, went to the same school, met through a professional association, belong to the same club, a neighbor, a relative, a personal friend)?
- Do you receive employee referrals for members of diverse groups? How many were referred by race, sex, ethnicity, disability and protected veteran status? To whom were the members of diverse groups referred? Were any of the individuals referred hired?
- Do you inform employees that the corporation is actively interested in referrals of underrepresented individuals? How are they informed? When are they informed?
- Do you provide a reward or bonus for referring a candidate that is ultimately hired?
When collecting and analyzing employee referral data, COs must remember that information on whether a person was an employee referral will not necessarily be in an applicant log. If no referrals are shown on a log, the CO needs to examine a sample of the files of people hired at the same level involved. Information on the employment application and interview notes may provide an indication of the source of the applicant or candidate. The CO may also be able to obtain relevant information through interviews of successful candidates (e.g., those hired or promoted into the job title at issue).
4H04 Internal Development
If not already provided, the CO must request documents on the contractor’s promotion, training, and transfer policies and procedures. With this information, the CO should discuss the procedures with human resources and other appropriate corporate officials. In particular, the CO must clarify how the procedures apply to headquarters positions at, above and below the management level where nonfavored group member participation declines. The CO must also clarify how these procedures apply to movement from subordinate establishments to corporate headquarters and vice versa.
For most corporate management positions, particularly at the higher senior levels, placement through internal movement like promotions and transfers, rather than by new hire, is generally the rule. Therefore, in order to conduct a proper analysis, it is important that the CO fully understand the various elements that can affect internal placement, particularly those unique to a CMCE, such as succession plans. Further, the higher the management level, the less likely it is that the contractor will include the jobs in any formal job announcement system the contractor may have, and the more likely it is that the contractor includes the jobs in some kind of formal or informal succession planning.285 Below are several sample question areas that COs may find helpful.
- How do you make promotion and transfer opportunities known to potential candidates? Is the process the same in all functional areas? Are there differences in the process for positions at the upper management levels?
- Do you make openings at corporate headquarters known to employees in subordinate establishments as well as to employees at headquarters? How? How do employees at subordinate establishments express an interest in being considered for an opening at corporate headquarters?
- Do you make openings at subordinate establishments known to employees at corporate headquarters? Who is responsible for doing so? How is it done? What is the process by which employees at the corporate headquarters express an interest in being considered for openings at subordinate establishments?
- How many employees applied for positions at the corporate headquarters? Identify these employees by race, sex, ethnicity, disability and protected veteran status, and identify how many were hired?
The CO should review promotion and transfer actions for conformity with the corporation’s stated policies and practices. The CO should also interview the contractor’s current, former and new employees regarding their understanding of, and experiences with, the corporation’s promotion and transfer practices at the corporate, regional and subordinate establishment levels.
The CO should examine personnel files of managers at and above the level where nonfavored group member participation declines.
a. Succession and Related Planning
The vast majority of corporations engage in some form of planning for future management and personnel needs. These plans go under many different names, such as “human resource development plans,” “succession plans,” “business plans,” “management reviews,” “replacement tables,” “developmental needs assessment,” “high-potentials,” “fast-track” and “promotion rosters.” The scope and detail of the plans may vary considerably. Areas where there may be the greatest variance include:
- The depth of the plan or how deep into the organizational structure the plan reaches;
- The degree of centralization or the degree of control exercised by corporate headquarters compared to the regional headquarters or subordinate establishments;
- The degree of formality involved with the plan (e.g., the existence of a written plan, the use of regular plan reviews); and
- The degree the plan is affected by standard performance appraisal or other personnel processes.
When succession planning is explicit or more formal, there may be more specificity and several contingent options when implementing the plan. For example, an explicit plan may specify that a specific person is ready to step into the job or position as a permanent replacement for the incumbent, if necessary. It will also have contingencies should that person be unable or unavailable to assume the position. If no one is currently ready to assume the position permanently, most formal plans still provide a way forward by:
- Designating a person who could take over until a permanent replacement is developed; or
- Designating one or more persons who could be a permanent replacement, given additional developmental experiences or training, or both. The plan would also identify needed training and experiences, how long it will take and other appropriate detail.
In addition, to this level of specificity, a corporation may identify:
- A pool of employees (either specific, named individuals or a description of an employee group such as the number of employees currently in feeder jobs) the contractor considers to have a high-potential to develop into middle to senior-level managers; and
- A broader pool of employees the contractor considers promotable (either specific, named individuals or a description of an employee group such as the number of employees currently in feeder jobs).
The identification of employees, whether for a particular job or generally, is usually fluid, i.e., people may move onto or off of lists depending on shifting business needs, changes in personnel or individual job performance.
COs may want to ask specific questions about succession planning to determine if all qualified candidates are considered, and whether employees with potential have access to training and other developmental opportunities. Several sample question areas are below.
- Does the corporation have a succession plan to fill particular management positions should there be one or more vacancies?
- Which management jobs or management levels are covered by a succession plan?
- What does the corporation’s plan cover? Does the succession plan include both short and long-term planning, i.e., for people who are currently ready to assume the position, and for those who may be ready after further developmental experiences and training?
- Are candidates in regional headquarters or other subordinate establishments considered when designating possible successors? If so, how are nonheadquarters and headquarters candidates identified?
- Are there written materials describing the plan and offering guidance on selection and development of candidates? Who developed the plan? Are employees advised of the plan?
- If the succession plan identifies specific individuals as potential successors for certain jobs, does the permanent successor most often come from among those identified? What are some examples?
- When is the plan reviewed and modified? Who is responsible for the review?
- What is the representation by race, sex, ethnicity, disability and protected veteran status among those identified as potential permanent successors?
- How does the representation of members of protected groups who are identified as potential permanent successors for management jobs compare to their representation in the total candidate pool (e.g., in feeder jobs) for those jobs?
- If the proportion of one or more of these groups in the succession plan is well below their proportion in the total candidate pool, what is the reason for this discrepancy?
- What steps do you take to rectify the problem and recruit and/or prepare more group members to be manager successors? Who (by group member status) has graduated from a succession planning system into management?
- What, if any, developmental experiences does the corporation require or prefer (e.g., on-site training, off-site training, rotational assignments, special projects)? Are there any individual development plans?
- Does the corporation have any policies or practices for identifying people below the management level with a high potential for advancement?
- How does the process work? How are the individuals identified? What factors are used? Does a person need to be “sponsored” by a current manager? Why or why not?
- What is the lowest level at which an employee will be considered for succession?
- Are there any written materials describing the process, offering guidance on selecting and developing participants?
- How closely and how often does corporate headquarters monitor the process? Does the monitoring include ensuring that affirmative actions are taken to guarantee EEO in all aspects of succession planning and management development?
- What is the representation by race, sex, ethnicity, disability and protected veteran status among those identified as “high-potential” versus those eligible to be so identified?
- If the proportion of representation by race, sex, ethnicity, disability and protected veteran status is well below their proportion of those eligible, what, if any, analysis was done and what were the findings?
When the contractor has succession planning programs and there is a disparity in the proportions of representation by race, sex, ethnicity, disability and protected veteran status included in the candidate pool, COs must determine the reasons for the disparity. In order to do so, COs must explore several areas and follow-up including:
- If there is EEO monitoring and an explanation is offered for a disparity, COs should verify the explanation in the course of examining data and files concerning internal mobility, and through interviews with selected employees and managers.
- If there is no EEO monitoring or no explanation is offered for a disparity, COs should analyze the disparity based on the information provided concerning the scope of the program and the criteria for inclusion. A few examples may be:
- Where there is multi-establishment participation in the succession planning program, do any establishments have a particularly large gap between the percentage representation by race, sex, ethnicity, disability and protected veteran status in the program, as compared with the percentage of identified group members eligible for inclusion (e.g., in feeder jobs)?
- Were the selection criteria for inclusion in the program uniformly applied?
b. Movement Within Headquarters
- Transfers within Headquarters. As with lateral cross-establishment moves, transfers within headquarters may represent planned rotational assignments. Based on information already gathered, COs should identify those moves within headquarters that appear to meet that definition. Also, if the data permits, COs should identify instances in which people transferring were subsequently promoted. When those transfers or promotions are into the level at, above or below the level where nonfavored group participation declines, COs should incorporate the information into the analysis, and interview the employees and selecting officials involved to confirm the reason(s) for each move and how it was initiated.
- Promotions within Headquarters. When beginning to determine the frequency, types and paths to internal promotions within headquarters, COs must first make several determinations:
- What is the typical grade increment involved (e.g., one grade increase, two)?
- To what extent do promotions tend to remain within broad functional areas (e.g., finance, engineering, personnel)?
- To what extent do promotions cross functional areas (e.g., from engineering into personnel)?
- Are there any patterns that stand out regarding functional or cross-functional promotions (e.g., promotions are functional up to a certain level, then switch to cross-functional, or vice versa)?
When there is considerable cross-functional movement, a refined IRA, or other analysis, may be useful for focusing the investigation. For example, if employees typically progress in one grade increments, promotions by favored and nonfavored group status at each relevant grade may be compared with incumbency by favored and nonfavored group status in the next lower grade.
When movement is predominantly within function, the COs should identify functions where promotions occurred. COs should evaluate whether nonfavored group members were not promoted even though there was good participation of nonfavored group members in the source grade. COs should pay particular attention to any functional areas they identified at the desk audit with the greatest disproportion between the participation of nonfavored group members above and below the grade where their participation declines in the workforce as a whole.
When some functions have concentrations of favored or nonfavored group members and other functions have underrepresentation of favored or nonfavored group members, these employees are likely to stay in these positions. This scenario is most likely when movement is primarily within function. COs should examine a sample of the contractor’s files on nonfavored group members in the concentrated personnel areas to identify any placement problems.
For example, if nonfavored group members are heavily concentrated in staff positions in a “high-tech” firm, the contractor should determine whether any of them have technical backgrounds that would have qualified them for line functions. If so, did they start in staff positions or move into staff positions later? In either case, did the contractor determine why nonfavored group members are heavily concentrated?
- Average Time in Grade or Corporate Service. One way for COs to evaluate whether nonfavored group members are progressing in the managerial ranks is to look at the average time they spend in their current pay grade in comparison to members of the favored group in the same grade. COs can also extend this comparison to corporate service or tenure. COs should refine the focus of their inquiry if nonfavored group members spend considerably more time in the same grade than their counterparts. To do so, COs may focus on the possible reasons for the differences. For example, they can seek to determine whether nonfavored group members hold the type of jobs that limit opportunities, or whether the contractor passes over nonfavored group members for promotion. Alternatively, the analysis may show that nonfavored group members have less time in a grade than their peers. If this is the case, service time may be an explanatory factor for nonfavored group members not advancing to higher positions.
- “Typical” Career Paths. COs should ask whether promotions show repetitive patterns that appear to represent “typical” career paths within major functional areas. For example, in the functional area of purchasing, COs may want to explore whether promotions tend to be from being a Buyer, to becoming a Purchasing Supervisor, and then to a Purchasing Manager. In sales, COs may want to determine whether the typical career path is from Account Executive III to II to I, to Area Sales Manager, and then to District Sales Manager. When these progressions appear, COs should compare the representation of nonfavored and favored group members with the feeder titles of the composition of those promoted.
c. Cross-Establishment Movement
- Movement to Headquarters from Subordinate Establishments. Early in the corporate management evaluation, COs must determine the degree to which the contractor fills management openings at corporate headquarters by promotion or transfer from subordinate establishments, rather than from within headquarters itself. This balance may vary depending on the management level or functional area. For example, at lower management levels, promotions or transfers may be predominantly within headquarters, while at higher levels, they may come predominantly from outside headquarters.
Such information will assist COs in identifying feeder pools for management jobs and, therefore, may influence whether COs expand the evaluation to include one or more subordinate establishments.286
- Movement from Headquarters to Subordinate Establishments. Promotions and transfers out of headquarters to subordinate establishments also may be relevant, particularly in situations where the contractor views exposure to different operating business components as important to advancement to or above the level where nonfavored group member participation declines.
- Rotational Assignments. Cross-establishment transfers, whether into or out of headquarters, or between nonheadquarters establishments, may represent planned rotational assignments as a part of a formal or informal development program.
As with the choice to fill a job by hire or promotion, the choice to fill it by transfer rather than promotion, or from a subordinate establishment rather than within headquarters, is itself a selection decision. While that decision may appear to be EEO neutral, COs should be alert for any pattern that suggests a correlation with a prohibited factor. Sample question areas that may be helpful on this and related points are below.
- Is work experience in subordinate establishments important to advancing to corporate management positions? In what fields? Is working at corporate headquarters important to advancing to senior management at subordinate establishments?
- When is a cross-establishment move generally made during an employee’s career?
- Are cross-establishment moves ever part of a formal career planning process? How does this fit into long-term succession planning?
- Are rotations through the corporation’s overseas locations a ‘preferred’ or ‘required’ qualification for moving into senior management positions, either officially or unofficially?
- What happens if an employee refuses a job offer requiring relocation? Are the effects of refusing to relocate on career prospects the same for all employees who refuse to relocate?
COs must review any written material on corporate policies related to promotions and transfers, as well as the data requested earlier on promotions and transfers to management jobs at, above and below the level where nonfavored group member participation declines. At a minimum, the data in the analysis should include:
- The date of each promotion or transfer;
- Race, ethnicity and sex information of each selectee;
- Disability and protected veteran status of the selectee, when known; and
- The job title, grade and department, as well as the establishment from which and to which the promotion or transfer occurred, if it is not within corporate headquarters.
d. Promotions and Transfers into Headquarters versus within Headquarters. COs must determine the extent to which feeder pools for headquarters positions are internal and external to headquarters. COs must separate promotions from subordinate establishments into headquarters from promotions within headquarters. COs should do the same with transfers.
COs should ask or seek to determine how, at given grades or types of functions, the volume of promotions and transfers into headquarters compares with the volume within headquarters.
e. Promotions and Transfers into Headquarters from Subordinate Establishments. If subordinate establishments are an important feeder pool, COs must examine the participation of nonfavored group members in this pool. For promotions and transfers from subordinate establishments into headquarters, COs must note the grade level and originating establishment.
COs should address several question areas related to promotions and transfers into headquarters to identify potential problems:
- How does the majority of the movement into headquarters occur? Is it from only a few establishments? Are these establishments part of a particular intermediate business group?
- How does the participation of nonfavored group members in exempt positions in establishments from which promotions or transfers, or both, occurred compare to their participation in exempt positions in other establishments?
f. Performance Appraisals. Performance appraisals are an important and essential management tool. This tool can inform promotion and other decisions. The vast majority of corporations have a formal performance appraisal process for exempt staff. These processes differ in a number of ways, among them:
- The frequency with which performance appraisals are conducted, although most are conducted annually.287
- The degree to which the employee being appraised contributes to the process. For example, in some instances, the process begins with the employee giving a written self-evaluation of his or her progress against performance goals established in the last appraisal cycle. Sometimes this evaluation includes indicating what his or her goals are for the coming year.
- The manner in which the appraisers express the evaluation ratings. Some appraisers use only numeric values and others may use a narrative.288
- The requirement that employees sign their appraisals and whether employee comments are permitted.
- The level of the individual responsible for reviewing the appraisal.
Corporations link appraisals to salary increases, bonuses and promotions. Section 4H touches on issues related to promotions and Section 4I reviews issues related to salaries and bonuses. COs will want to know whether the corporation gives employees in the same grade level who receive a given rating the same percentage raise. COs will also want to know when a formula is used for determining raises and bonuses, and how heavily the rating is weighted. COs may find the below sample questions on performance appraisals useful.
- What is the corporation’s performance appraisal process for exempt staff? Does the corporation use the same appraisal process for all exempt staff? Is the process different for the various levels or grades in the company?
- Does the corporation use a numeric or narrative appraisal rating? If neither of these is used, how is the rating method described?
- What are the highest and lowest scores for the corporation’s numeric rating system? What is the range of acceptable scores? How is the range of acceptable scores established? When was the range established and when was it last modified?
- What score or performance rating does an employee generally need for promotion?
- Are there any written guidelines or training on how to administer the appraisal? Describe the guidelines the corporation provides to the rating official. Is reference made to EEO? If so, explain.
- How often are your employees appraised? Who appraises them and who approves the ratings? What is the degree of employee input?
- Is career planning included in your process? Is this planning short term, long term or both?
- Are “benchmark” or career interval appraisals used?
- Does the corporation monitor appraisal results for EEO? If so, how? What have been the results?
- Are raises, including bonuses and promotions, based on appraisals? If so, what is the relationship?
After gaining a better understanding of the appraisal system and the use of employee ratings, COs should analyze this information. For example, if a CO learns that a numeric system is used, the CO should determine the average rating for the nonfavored group at the grade level just below where nonfavored group member representation declines. If the average appraisal rating is substantially lower for nonfavored group members, the CO must determine if the contractor’s EEO audit offers any reasons or explanations. Other areas of inquiry include determining:
- What, if any, actions the contractor took to eliminate the disparity; and
- Whether the disparity is traceable to certain functional areas.
If the corporation uses a narrative system, then the CO would explore any differences in the tone between appraisals of nonfavored and favored group members.
g. Visibility. One element of career advancement can be the amount and type of exposure to senior corporate management through assignment to special projects, task forces, corporate committees or through appointment to special assistant and executive assistant type positions.
Being assigned special projects and working on teams and groups are ways employees gain increased visibility within the corporation. There is considerable variation in the degree to which corporations use special projects, working groups and teams. Some projects may be more desirable than others in terms of opportunities for skills development and visibility. In some industries, this difference will be fairly clear simply because of the nature of the industry, or the corporation may have a formalized structure. For others, COs may need to rely on employee and management interviews, as well as any group award program maintained by the contractor, that may reflect projects that were particularly desirable.289
COs will want to compare the nonfavored and favored group composition of special project teams and task forces with the nonfavored and favored group composition of the jobs or functional areas from which members were or reasonably could be drawn. Below are several sample questions that can result in useful information on opportunity and participation of nonfavored group members on teams and groups.
- Does the corporation make use of special projects, and teams and working groups? If so, in what areas of the business?
- How are members selected and by whom?
- What special projects, teams and working groups are currently operating? What is the favored and nonfavored group composition of each?
- Are selections monitored to ensure equal opportunity for all eligible nonfavored group members? If so, by whom? Have there been any cases where a concern was raised and, if so, how was it handled?
h. Corporate Committees. Most boards of directors appoint standing committees to monitor and keep the board informed on a specific subject area. In many cases, these committees may simply reflect functions. The appointment to these committees is usually nondiscretionary and based solely on position. It can be useful for COs to know the composition of such committees in order to understand the nonfavored group composition corporate-wide of such positions.
There may also be special purpose committees that draw from a wider range of positions and levels within the corporation. Serving on these committees often provide members career enhancing opportunities through exposure to corporate leadership, networking, mentoring relationships and broadening knowledge of the corporation. COs should examine nonfavored group member participation. COs should compare the membership for each committee with those eligible for such membership. For functional and position-based committees, COs should ensure that all qualifying employees are included as members and determine the reasons for any discrepancies.
i. Special Assistants and Executive Assistants. People holding such positions, particularly ones reporting directly to senior corporate management regardless of actual title, may be on a “fast-track” to middle management positions by offering the incumbent enhanced developmental opportunities. In some cases, there may not be formal guidance on the creation or appointment of employees to these positions. In such cases, interviews can be critical to gathering useful information.
In addition to other sources of information on these positions, COs should review the organizational profile for any special assistant and executive assistant type of positions. Note that if such titles are nonexempt, or relatively low-level exempt, the incumbents may be in support staff rather than “fast track” positions.
j. Assignments in Particular Industries and Lines of Work. In some industries, a number of people may share the same or very similar titles and yet differ substantially in the career growth potential offered by their assignments. For example, in sales positions, some product lines may offer higher commission potential than others. Some territories may have been worked extensively, and thus offer primarily opportunities for renewal or upgrade of orders. Others may be relatively unworked and thus offer a greater opportunity for new business. For account managers, the dollar volume and growth potential of accounts managed are important to advancement.
After identifying distinctions between favorable and less favorable assignments, COs should determine if nonfavored group members are underrepresented in the former and concentrated in the latter. COs should determine how the corporation makes assignments, particularly for the most and least valuable. They should ask if these assignments are monitored to ensure equal opportunity for all eligible employees. It is also important to know if there is a formal structure that defines the value of these assignments.
285. See FCCM 4H04 – Succession Planning.
286. See FCCM 4A01 – Scope of CMCEs.
287. If a regular appraisal cycle is supplemented by a “benchmark”, a longer-term career assessment process such as career reviews at the third and seventh years of employment may take place. The career assessment processes may be a component of succession planning. More on succession planning is in FCCM 4H04.
288. For example, an “outstanding” rating may be valued at four points or assigned the number four, while an “unacceptable” rating may value at zero. A narrative rating would consist of a brief overview summarizing an employee’s level of performance and accomplishments to substantiate a particular rating. Still, other corporations may use both numeric and narrative forms of evaluation. Be aware that appraisal factors for supervisors and managers typically differ from those for professionals and, the higher level the manager, the less likely it is that the appraisal is only numeric.
289. FCCM 4I01 – Recognition: Awards and Honors.
4H05 Management Training and Executive Development
A CMCE should cover both management training and executive development programs. The success of new and high potential employees is influenced by how quickly they learn people-oriented management skills that complement their expert or technical knowledge. Management training is a source of the key skills, best practices and behaviors of effective managers like leadership, delegation, motivation, empowerment, communication and vision. Possessing these skills and traits increase the likelihood of being promoted or transferred into corporate management or other leadership positions. If a corporation offers any management training, COs must determine how it is delivered, who is eligible to participate, who makes the decisions, and how the decisions are made by the corporation. Other relevant question areas are:
- Is the training a requirement for a management position? Has the corporation placed any people directly into management without such training? If so, what is their nonfavored or favored group status?
- How does an employee learn of the training? How is an employee selected for it?
- Who monitors participation in training to ensure equal opportunity for all eligible employees?
- What is the composition of the nonfavored and favored groups based on the individuals participating in training over the last year (or evaluation period)?
- How does that composition compare with the nonfavored and favored group composition of those eligible to participate in training?
- If there is a substantial difference between the proportion of nonfavored group members eligible and those participating, what cause was found?
- Does the training include any segments on EEO or diversity management? Up to what level do managers attend?
Executive development programs can be internal, external or both. These programs represent a substantial investment by the corporation in the development of people viewed as potential senior executives. They generally prepare middle-management executives to become more effective leaders and change agents within the company. Because the number of participants is typically small, it may be most useful to look at who participated at some point in their career, rather than only those who participated during the evaluation period. COs may want to ask questions in areas like those below.
- What level manager is eligible? Are there, or have there been, any exceptions to the eligibility level (e.g., have managers below the designated level ever been able to participate in the program)? If so, who authorized those exceptions and why?
- How are people selected for executive development programs? By whom? Are selections monitored to ensure equal opportunity for all eligible employees? Have there been any cases where someone raised a concern and, if so, how did the corporation handle it?
- Among the eligible managers, can you identify who participated in the executive development program by sex, race and ethnicity? If there is a nonfavored group, the CO should ask whether members of the nonfavored group participate, were their training programs comparable in type, school, duration and other relevant areas to those attended by their favored group peers?
- If there is a nonfavored group, the CO should ask managers of that group whether there are plans for members of the nonfavored group to participate in executive development programs? Did their predecessor participate? At what point in his or her career?
4H06 Mentoring and Networking
In addition to formal management development programs, many senior managers report having had mentors at some point in their career who served as role models, translators of corporate culture or advocates. Because these relationships are generally informal, and may be initiated by either the potential mentor or “mentee,” interviews may be the only way to determine if:
- Mentoring exists at the management levels under review;
- Mentoring is an informal or formal program with policies and guidelines; and
- Mentoring carries weight or is value-added in the career advancement process.
COs should also find ways to determine if there are any potential concerns regarding participation of nonfavored group members.
In addition to examining the role and importance of mentoring in career advancement, COs must also consider networking. As used here, networking is the establishment of contacts beyond one’s immediate work setting or level, or both, that confer a business benefit. Some corporations have established groups that provide a formal opportunity for managers at a given level to network across division and often establishment lines. If the corporation has such a group, COs should determine the level of managers eligible to join, and ensure that any nonfavored group member managers at that level or above are offered membership on the same basis as their peers. Other networking opportunities may be found in outside professional associations and/or social clubs. If the corporation supports membership in such outside organizations, COs should ensure that eligible nonfavored group member managers receive such support on the same basis as their peers.
Unlike formal networking, informal networking is generally interacting across establishment or functional lines with peers and higher level managers. If a corporation does not formally disseminate information on job openings or does so only up to a certain level, networking may be the prime source of information about job openings, particularly those at other establishments. Also, contacts established over time can contribute to career enhancing assignments on work projects involving other departments or establishments.
Although the general assumption is that informal networking is a matter of employee initiative, some corporations affirmatively encourage the development of such contacts among groups not currently well represented in management jobs by, for example, sponsoring meetings or establishing committees that bring together group members from different functions, establishments or management levels.
COs do have certain things to consider when evaluating the role of networking, such as:
- Do internal formal networking groups exist? How and by whom are they administered?
- Who is eligible for membership? How and by whom is membership extended or approved? Who monitors membership to ensure equal opportunity for all eligible employees?
- Have there been any potential concerns regarding participation of nonfavored group members? If so, how were the concerns handled?
- Does the corporation encourage or sponsor participation in external networking groups? If so, which ones and what form does the corporate ‘support’ take?
- Does the corporation ensure that all eligible employees know about this option? How?
- Who monitors the program(s) to ensure all eligible employees have equal opportunity to participate and receive the same support? Have there been any potential concerns regarding eligible nonfavored group members? If so, how were the concerns handled?
- Does the corporation promote informal networking opportunities? How? Are there specific target groups?