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OFCCP Wishes Contractors a Happy Valentine’s Day: Introducing VERP, The OFCCP’s New Voluntary Enterprise-Wide Review Program

On the eve of St. Valentine’s Day, the Office of Federal Contract Compliance Programs (“OFCCP”), unveiled a Voluntary Enterprise-Wide Review Program, otherwise referred to as “VERP” for high-performing federal contractors. The new Program is intended to compliment the goals of the Agency’s Early Resolutions Procedures Directive released in December of 2018, which promotes and provides voluntary incentives for early corporate-wide resolution of equal employment opportunity law violations during OFCCP compliance evaluations. According to the framework set out in VERP’s directive, the Program, if successful, will officially recognize the efforts of its top‐performing contractor participants, and accepted participants will be removed from the neutral selection process that the Agency uses to schedule establishment-based compliance evaluations. The Program is meant to blend compliance evaluation and assistance activities of OFCCP to enable the OFCCP to work with high-performing contractors to obtain a mutual goal of continuing, corporate-wide compliance, outside of the OFCCP’s neutral establishment‐based scheduling process.

While the Directive does not formally set out the requirements of the Program, it provides an outline by which the OFCCP will develop and implement the Program. First, the Program will recognize two different tiers of contractors, a top-tier and lower-tier, with the top-tier contractors having a more stringent set of requirements.

Contractors who have qualified for the top-tier status can remain in the Program’s top-tier for a period of five years, at which point they will be re-evaluated, and remain in the top-tier status in the Program, be lowered to the lower-tier, or be removed from the Program entirely. The lower-tier provides for a three-year timeframe combined with compliance assistance to help those contractors in the lower-tier move into the top-tier status.

Entities who are interested in participating in the process, such as contractors who want to be recognized for their comprehensive, corporate-wide inclusion and compliance programs,  will need to apply at the beginning of the fiscal year 2020, and allow the OFCCP to audit their headquarter location, as well as a sample or subset of their various establishments. The framework of the Program does not specify how many additional audits would be scheduled by OFCCP to be in the Program. To remain in the Program, Contractors are expected to maintain a workforce free of discrimination and/or other material violations, as well as provide periodic reports and information to the OFCCP through which the OFCCP can confirm these efforts are being continued and met.

The OFCCP believes that VERP will not only help the OFCCP be more effective in achieving its mission to protect workers, promote diversity, and enforce the law, but that it will also provide cost-saving compliance incentives to recognize those contractors that excel in their corporate‐wide compliance with the OFCCP’s requirements.

If you have questions about the OFCCP’s new Voluntary Enterprise-Wide Compliance Program, please feel free to contact one of our attorneys by calling (501) 371-9999.