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Office of Federal Contract Compliance Programs (OFCCP)

 

Functional Affirmative Action Program (FAAP)
Frequently Asked Questions (FAQs)

  1. What is a Functional Affirmative Action Program?
  2. When did the revised FAAP Directive (DIR 2013–01, Revision 1) take effect?
  3. I submitted a request for a FAAP agreement before the revised FAAP Directive became effective on April 28, 2016. However, a decision on my request was still pending as of April 28. Do I have to resubmit my FAAP request so that it complies with the revised FAAP Directive?
  4. I submitted a request to renew my FAAP agreement prior to the April 28, 2016 effective date of the revised FAAP Directive. Do I have to comply with the revised directive?
  5. What is the difference between an establishment and functional or business unit?
  6. What basic requirements must a functional or business unit meet in order to be considered for a FAAP?
  7. How can covered contractors apply for the FAAP Program?
  8. How long does the application process take?
  9. What is the term of the FAAP agreement?
  10. What is the process for certifying a FAAP agreement?
  11. Can functional units be added or removed during the three–year certification?
  12. Which OFCCP office will send the scheduling letter for the compliance evaluation of a functional or business unit? Where will I submit the requested written AAP and support data for my functional or business unit?
  13. Where can I find the required elements of a FAAP?
  14. How is a FAAP compliance evaluation different from an establishment–based compliance evaluation?
  15. Can OFCCP schedule a contractor with a pending request for FAAP agreement for an establishment–based compliance evaluation?
  16. Can my company terminate its FAAP agreement?

 


 

1. What is a Functional Affirmative Action Program?

As an alternative to developing establishment–based Affirmative Action Programs (AAPs), federal contractors are allowed to enter into an agreement with OFCCP that permits the development of a program organized around a business function or line of business. For some multi–establishment contractors that have large business or functional units, such as a Sales Division or a Research and Development function that spans across establishments located in different states or regions, an AAP developed by a functional or business unit may be more appropriate. These functional AAPs, or FAAPs, will allow the contractor to examine whether its personnel practices and affirmative action efforts are sufficient to ensure equal employment opportunity for applicants and employees of a functional or business unit, rather than a particular establishment. The criteria for entering into a FAAP agreement are explained in the FAAP Directive (DIR 2013–01, Revision 1).


 

2. When did the revised FAAP Directive (DIR 2013–01, Revision 1) take effect?

The revised FAAP Directive became effective on April 28, 2016.


 

3. I submitted a request for a FAAP agreement before the revised FAAP Directive became effective on April 28, 2016. However, a decision on my request was still pending as of April 28. Do I have to resubmit my FAAP request so that it complies with the revised FAAP Directive?

No. Contractors who submitted an application for a FAAP agreement before April 28, 2016 are covered by the guidance in place at the time their application was submitted. In this instance, that would be FAAP Directive (DIR 2013–01).


 

4. I submitted a request to renew my FAAP agreement prior to the April 28, 2016 effective date of the revised FAAP Directive. Do I have to comply with the revised directive?

No. Contractors who submitted a request to renew a FAAP agreement before April 28, 2016 are covered by the guidance in place at the time the renewal application was submitted. In this instance, that would be FAAP Directive (DIR 2013–01).


 

5. What is the difference between an establishment and functional or business unit?

An establishment refers to a facility or unit which produces goods or services, such as a factory, office, store, or mine. In most instances, the unit is a physically separate facility at a single location, although OFCCP may consider several facilities located at two or more sites as a single establishment when the facilities are in the same labor market or recruiting area. A single establishment may contain several different functional units (e.g., a sales division, a research division, and a division of service workers).

A functional or business unit, on the other hand, is not generally defined by physical location, but rather refers to a component within an organization that operates autonomously in the ordinary course of the organization’s business, potentially spanning several different establishments. A functional or business unit should also have identifiable personnel practices or transactional activities specific to the functional or business unit (e.g., applicant flow, hires, promotions, compensation determinations, terminations, etc.) that are distinguishable from other parts of the organization’s business. Functions or business units are identified and defined based on the organization’s existing business operations, personnel practices and management structures.


 

6. What basic requirements must a functional or business unit meet in order to be considered for a FAAP?

The functional or business unit must exist and operate independently (e.g., managing official has ultimate responsibility for the decisions made within a functional or business unit), include at least 50 employees, have its own managing official and have the ability to track and maintain its own personnel activity.


 

7. How can covered contractors apply for the FAAP Program?

Contractors may apply by submitting a written request to the OFCCP Director explaining why it believes FAAPs are more appropriate. This explanation should describe in detail how the proposed FAAPs relate to the contractor’s organizational structure and include a transition plan describing the process and timing by which the organization will move from establishment–based AAPs to FAAPs. In addition, the request must include the name and contact information of the corporate representative who will be responsible for overseeing the request for a FAAP agreement.

OFCCP must receive the request for a FAAP agreement no later than 120 calendar days prior to the expiration of the current corporate headquarters’ AAP, or within 120 days after the award of the federal contract if this is a new contractor.


 

8. How long does the application process take?

OFCCP typically processes a new application for a FAAP agreement in 60 days or less. During this time, OFCCP will review the application materials, perform background research, and may request a meeting with company officials to discuss the application and the company profile. Until the FAAP agreement is approved by OFCCP, contractors must continue to develop, implement, and maintain AAPs at the establishment level.


 

9. What is the term of the FAAP agreement?

Functional AAP agreements expire three years from the date of approval by the OFCCP Director.


 

10. What is the process for certifying a FAAP agreement?

The contractor must certify in writing every three years (at least 120 calendar days prior to the expiration of the existing agreement) that they continue to operate under a functional structure. FAAP agreements that are certified will be re–issued for another three–year term after execution of the agreement by the contractor’s representative and the OFCCP Director.


 

11. Can functional units be added or removed during the three–year certification?

Contractors may remove or add functional units during the three–year certification. If functional units are being added or removed, a written statement explaining the changes must be submitted with the written certification.


 

12. Which OFCCP office will send the scheduling letter for the compliance evaluation of a functional or business unit? Where will I submit the requested written AAP and support data for my functional or business unit?

The Branch of Functional Affirmative Action Programs is responsible for sending the OMB–approved scheduling letter to FAAP contractors. The FAAP branch is located in OFCCP’s national office in the Division of Program Operations in Washington, D.C. OFCCP field office staff conduct compliance evaluations of functional or business units. Contractors must submit their FAAPs and support data to the office indicated on the scheduling letter within 30 days of receipt of the scheduling letter.


 

13. Where can I find the required elements of a FAAP?

All FAAPs must include the required AAP elements outlined in 41 CFR 60–2, Subpart C of 41 CFR 60–300, and Subpart C of 41 CFR 60–741.


 

14. How is a FAAP compliance evaluation different from an establishment–based compliance evaluation?

OFCCP conducts FAAP compliance evaluations in the same manner that it does establishment–based compliance evaluations. During FAAP compliance evaluations, OFCCP follows the compliance evaluation procedures identified in the Federal Contract Compliance Manual. However, because functional units typically span several locations, a FAAP compliance evaluation may involve onsite visits to multiple locations, if applicable.


 

15. Can OFCCP schedule a contractor with a pending request for FAAP agreement for an establishment–based compliance evaluation?

Yes. Contractors can be scheduled for establishment–based compliance evaluations during the FAAP agreement approval process. Further, establishment–based evaluations scheduled prior to and during the FAAP approval process will continue after the FAAP agreement is approved. Contractors are only exempt from future establishment–based compliance evaluations once the FAAP agreement is signed and executed by the OFCCP Director.


 

16. Can my company terminate its FAAP agreement?

Yes. Contractors who wish to terminate their FAAP agreements must give 90 calendar days written notice to OFCCP with a brief explanation of the reason(s) for the termination and the effective date. Once a FAAP agreement is terminated, all employees are required to be covered by an establishment–based AAP no later than 120 days from the contractor’s notification of termination.