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Office of Federal Contract Compliance Programs (OFCCP)

 

FAQs on Nondiscrimination in the Construction Trades

 

  1. What are the nondiscrimination obligations of federal and federally assisted construction contractors and subcontractors under Executive Order 11246?
  2. What is the difference between a direct federal construction contract and a federally-assisted construction contract?
  3. Are there other laws enforced by OFCCP that apply to federal and federally assisted construction contractors and subcontractors?
  4. What does it mean to have a disparate impact on a particular group?
  5. The regulations set forth goals for the number of women and minorities that participate in each trade at the contractor’s workforce. If a contractor is meeting all of these participation goals for minorities and women, does that mean it is not engaging in any discrimination?
  6. If a contractor fails to meet its participation goals, is it in violation of Executive Order 11246?
  7. If employees or applicants experience discrimination while working for or applying to work for a federal or federally assisted construction contractor or subcontractor, what can they do?
  8. What information and documents do federal and federally assisted construction contractors and subcontractors have to maintain under Executive Order 11246 and for how long must they retain them?
  9. Are contractors permitted to use tests or other exams to select individuals for hire?
  10. Is harassment a form of discrimination?
  11. In what ways are contractors required to disseminate their EEO policies?

 


 

1. What are the nondiscrimination obligations of federal and federally assisted construction contractors and subcontractors under Executive Order 11246?

The non–discrimination obligations of contractors and subcontractors that hold any federal or federally assisted construction contract in excess of $10,000 are set forth in the Equal Opportunity Clause which can be found at 41 C.F.R. 60–1.4(b). Generally, covered contractors must not discriminate against any employee or applicant for employment because of race, color, religion, sex, sexual orientation, gender identity, or national origin.

This non–discrimination obligation includes both intentional discrimination (disparate treatment) and the use of employment practices that adversely impact members of one group more than another and are not shown to be job–related and consistent with business necessity (disparate impact). It also includes a requirement not to discriminate against employees or applicants because they have inquired about, discussed, or disclosed their compensation or that of others, subject to certain limitations.

More information about disparate treatment and disparate impact discrimination is provided in question 4.

 


 

2. What is the difference between a direct federal construction contract and a federally-assisted construction contract?

A direct federal construction contract is an agreement or modification to an agreement entered into directly with the federal government through one of its agencies for the purchase, sale or use of personal property or nonpersonal services, where the term “nonpersonal services” includes construction services. For example, a construction contract awarded by the General Services Administration to build a federal courthouse would constitute a direct federal construction contract.

A federally–assisted construction contract is any agreement or modification which is paid for in whole or in part with funds obtained from the federal government but where the government is not a party to the construction contract. Federally–assisted contracts could be funded through, for example, a federal grant, contract, loan, insurance or guarantee. An example of a federally–assisted construction contract could be a contract to build highways or bridges that is funded by federal grants to state Departments of Transportation.

Executive Order 11246 applies to both direct federal construction contracts and federally assisted construction

contracts.

 


 

3. Are there other laws enforced by OFCCP that apply to federal and federally assisted construction contractors and subcontractors?

Federal construction contractors must also comply with the requirements of Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974. These laws prohibit discrimination and require affirmative action on the basis of disability and protected veteran status, respectively. Federal construction contractors can use this infographic to help determine whether they are covered by these statutes: https://www.dol.gov/ofccp/posters/Infographics/JurisdictionalThresholds.htm.

These laws do not apply to federally assisted construction contractors.

 


 

4. What does it mean to have a disparate impact on a particular group?

There are two types of unlawful discrimination – disparate treatment and disparate impact. Disparate-treatment discrimination occurs when a contractor intentionally treats an individual or group differently on the basis of a prohibited factor (race, color, religion, sex, sexual orientation, gender identity, national origin, disability, status as a protected veteran, or protected disclosure of compensation information). Examples of disparate treatment include a contractor assigning Black applicants only lower paid, unskilled positions because of their race, or requiring that female applicants be able to lift 50 pounds to qualify for a laborer position, but not requiring the same of male applicants. Disparate–impact discrimination occurs when a contractor applies a selection policy (e.g., a test or certification requirement) or uses a selection procedure (e.g., a recruitment practice) for a job uniformly to all applicants, but the use of the policy or procedure disqualifies members of a particular race or sex, for example, at a substantially higher rate than those of another race or sex, and this policy or practice cannot be justified as job–related and consistent with business necessity. The contractor does not have to intend for the practice to discriminate against certain groups for this to constitute unlawful discrimination.

An example of disparate–impact discrimination would be a lifting requirement that disproportionately disqualifies women from employment where it is not necessary for someone in the particular position being filled to lift items of that weight. Another example of disparate–impact discrimination could be word–of–mouth recruiting that results in disproportionately excluding certain racial or ethnic groups from consideration for job openings. If there is evidence of intentional discrimination, such a practice would also constitute disparate–treatment discrimination. Contractors should consider whether there are better, nondiscriminatory methods of recruiting a qualified workforce.

 


 

5. The regulations set forth goals for the number of women and minorities that participate in each trade at the contractor’s workforce. If a contractor is meeting all of these participation goals for minorities and women, does that mean it is not engaging in any discrimination?

Not necessarily. The participation goals for minorities and women are an important aspect of recruiting and developing a more diverse workforce. Contractors that meet these goals, however, still need to assess their practices for possible employment discrimination. For example, if a contractor’s workforce is 90 percent Hispanic, that contractor would likely be satisfying its goal for minority hiring, but other groups of workers – such as African Americans or Asians – may be experiencing discrimination. While the participation goal applies to minorities in the aggregate, OFCCP reviews the nondiscrimination obligation by examining how each minority group is individually affected by a contractor’s practices in determining whether or not there is employment discrimination.

Another example would be a contractor that meets its participation goal for women, but denies those women equal access to training or assignments, pays those women less than men in similar positions, or steers those women into lower paying jobs because of their sex. Such actions constitute discrimination in violation of EO 11246 even if the participation goal is being met.

Additionally, the participation goals only apply to women and minorities, but the Equal Opportunity Clause prohibits discrimination on additional grounds, namely sexual orientation, gender identity, religion, and on the basis of discussing pay. Furthermore, section 503 and VEVRAA prohibit federal contractors from discriminating on the basis of disability and protected veteran status, respectively, if they hold a direct federal construction contact.

 


 

6. If a contractor fails to meet its participation goals, is it in violation of Executive Order 11246?

Not necessarily. Contractors must engage in outreach and other good faith efforts to broaden the pool of qualified candidates to include minorities and women. Good faith efforts include, for example, monitoring the effectiveness of outreach and recruitment strategies in attracting diverse applicants and linking with different or additional referral sources in the event that recruitment efforts fail to produce a diverse pipeline of applicants.

The goals are not quotas, however, and no sanctions are imposed solely for failure to meet them. A contractor’s compliance is measured by whether it has made good faith efforts to expand its employment opportunities and break down barriers to employment for minorities and women. Failure to meet goals, by itself, is not a violation of the Executive Order.

 


 

7. If employees or applicants experience discrimination while working for or applying to work for a federal or federally assisted construction contractor or subcontractor, what can they do?

If employees or applicants believe they have been discriminated against on the basis of a protected category, they can file a complaint with OFCCP, the Equal Employment Opportunity Commission (EEOC), or a state or local civil rights agency with jurisdiction. Additionally, if they are enrolled in an apprenticeship program that is registered with the U.S. Department of Labor, they can also file a complaint with the Registration Agency with which the apprenticeship program is registered. The Registration Agency may refer a complaint to OFCCP or to another enforcement agency, as appropriate.

 


 

8. What information and documents do federal and federally assisted construction contractors and subcontractors have to maintain under Executive Order 11246 and for how long must they retain them?

Each contractor is required to maintain any personnel or employment record that it makes or keeps for either one year or two years, depending on the size of the contractor and the contract. If the contractor has fewer than 150 employees or does not have a Government contract of at least $150,000, the minimum record retention period shall be one year from the date of the making of the record or the personnel action involved, whichever occurs later. Otherwise, the contractor must retain the document for a period of not less than two years from the date the record is made or from the date of the personnel action involved, whichever occurs later.

A ”personnel or employment record“ would include, but is not limited to, records pertaining to hiring, assignment, promotion, demotion, transfer, layoff or termination, rates of pay or other terms of compensation, and selection for training or apprenticeship, and other records having to do with requests for reasonable accommodation, the results of any physical examination, job advertisements and postings, applications, resumes, and any and all expressions of interest through the Internet or related electronic data technologies.

For any of these records that the contractor maintains, the contractor must be able to identify:

  1. The gender, race, and ethnicity of each employee; and
  2. Where possible, the gender, race, and ethnicity of each applicant or Internet applicant.

Contractors must also document the meetings they hold with employees at which they review the company’s EEO policy and affirmative action obligations. The records of these meetings must identify the time and place of these meetings, persons attending, subject matter discussed, and disposition of the subject matter.

 


 

9. Are contractors permitted to use tests or other exams to select individuals for hire?

Yes. However, any test or other selection procedure that contractors use to select candidates for hire or to make job assignments or promotions cannot discriminate against those being considered. To that end, if a selection test or procedure has adverse impact on individuals in a particular race, sex, or ethnic group, the test or procedure must be validated to ensure that the qualification the selection procedure is designed to measure is job–related and consistent with business necessity. For example, if a contractor uses an English proficiency test, but that test results in a significantly higher percentage of Latino candidates being screened out, the contractor must show that speaking English is necessary for the job in question. (For more information regarding validated selection procedures, see the Uniform Guidelines on Employee Selection Procedures and Uniform Guidelines Questions & Answers).

 


 

10. Is harassment a form of discrimination?

Yes, harassment because of a protected basis, such as sex, race or ethnicity, can be a form of unlawful discrimination. With respect to sexual harassment, the conduct does not have to be of a sexual nature, and can take the form of offensive comments. Contractors are required to ensure that all foremen, superintendents, and other on–site supervisory personnel are aware of and carry out the contractor's obligation to maintain a working environment free from harassment, intimidation, and coercion.

 


 

11. In what ways are contractors required to disseminate their EEO policies?

Contractors are required to disseminate their EEO policies both internally to their employees and externally to applicants and referral sources. To inform current employees of the policy, contractors must include it in any policy manual and collective bargaining agreement; publish it in the company newspaper, annual report, or other company publication; and post it on bulletin boards accessible to all employees at each location where construction work is performed. In order to disseminate the policy externally, contractors must provide notice of the policy to unions and training programs; include it in any advertisements; and provide written notification to other contractors and subcontractors with whom the contractor does or anticipates doing business. Contractors must also annually review the EEO policy and have their employees that are responsible for hiring, assignment, layoff, termination or other employment decisions also review the policy prior to the initiation of construction work at any job site.