Joint Venture Project Teams and Knowledge Management

Mentoring PictureThe concept of knowledge management (KM) became formalized in the early 1990’s.  It captures an approach combining multiple disciplines to optimize the development, capture, sharing, and employing organizational knowledge.  Since then numerous government agencies, institutions, and companies have allocated resources to enhance their respective knowledge management practices.  In fact, there are several communities promoting KM practices and certification such as the Knowledge Management Institute.

What is KM

KM is employed by the federal government and the Department of Defense and private industry across a wide spectrum of activities.  On a more practical level it is an organization’s deliberate approach to establish effective staff processes to achieve and maintain the shared understanding to support decision making.  In addition, KM can assist organizations minimize “lost knowledge” through attrition of personnel with highly unique skills and help reduce duplication of knowledge across functional areas.

While there is no single definition of KM, the United States Air Force defines it as:

“…the integration of people and processes, enabled by technology to facilitate the exchange of operationally relevant information and expertise to increase organizational performance. This involves creating, organizing, applying, and transferring knowledge to facilitate situational understanding and decision making, which enables decision superiority.

So, in a nutshell three main components are:KM Picture

  • People – Organizational structure and departmental relationships
  • Processes – Decision/approval processes, functional lanes, client interaction
  • Tools – Information technology assets, content management, collaboration

Application of KM to a Construction Joint Venture Project Team

As projects have become more complex, integrated, and information intensive knowledge has become a critical resource to stay on schedule.  Standing up a joint venture project team adds to complexity of a project with a need to quickly form a cohesive team that operates and functions as smooth as possible.  In addition, each company brings its own distinct culture to the project which creates the opportunity for immediate friction and can add to the fog of project execution.  Therefore, it is important to plan and organize how the people, processes and tools will interact, before award.  Below I have included a few steps outlining an approach to apply KM on a large scale joint venture project.

Initial Planning

  • Identify organizational structure and relationships
  • Document information environment, requirements, and tools
  • Identify collaborative construct – daily, weekly, monthly rhythm of meetings
  • Document management protocols
  • Identify critical paths (for staff development and build up)
  • Establish a KM working group

Map and Analyze

  • Organizational Structure – What organization structure will support efficient prosecution of the project and support client relationships as well connectivity with each Joint Venture partners’ home organization.
  • Map and analyze core processes – Frequently Joint Venture teams are comprised of personnel with different backgrounds, levels of experience, and are unfamiliar to each other.
  • Document processes for repeatability – New staff will rotate on and off the project, create an environment that supports rapid integration of new personnel as the project changes.
  • Establish organization process measurement criteria

Implement

  • Train and orient staff personnel – encourage and enable knowledge sharing
  • Institutionalize processes across functional areas
  • Establish continuity (turn over) books prior to kick-off
  • Document staff processes and procedures

The establishment of mutually agreed upon processes and implementation of how the joint venture will stand-up, operate, and close down will increase the effectiveness and efficiency of the new organization.  For some projects the establishment of the joint venture entails the generation of up to $1 billion of revenue over a three to four year time frame, more than some companies will see for years.  The small amount of time and money in comparison should be evidence of how worthwhile a little forward planning can be.

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2014 Year in Review

Tower Crane 2

Thanks to my blog readers during 2014 – your views and comments have helped shaped the content I post.  2014 marked the second full year of my blog and it tallied over 6100 views, almost triple the views registered during 2013.  The “Standard Form (SF) 1413 Statement and Acknowledgement Compliance Tips” post continues to be the most highly read of all time.

Throughout the year I posted a blend of original content, several blog articles from 2013, and reblogs from other sources such as Harvard Business Review.

Below is a consolidated list of articles from 2014:

Top Five Most Popular Blogs of 2014:

I look forward to continuing in 2015 with a continued focus on federal contracting and partnering.  In particular I will take a closer look at small business contracting issues and initiatives, Small Business Liaison Officer training, project team communication, partnering setting goals and achieving them, and project team communication and collaboration.

Happy New Year!

Small Business Program Policies and Procedures Manual

Policy ManualIf your firm is a large business federal contractor does it have a small business program policy and procedures manual and an assigned small business liaison officer (SBLO)?

Two of my earlier posts dealt directly with the Establishment a Small Business Program and Small Business Utilization Surveillance and Reporting.  To continue the theme, this post deals directly with the content and benefits of a policy and procedures manual for a federal contractor’s small business program.  One of the central reasons for implementing a policy and procedures manual is to provide your federal contracting team with the guidance, knowledge and resources to lead and manage a successful program.  In addition, it can elevate your firm’s small business program from maintaining baseline compliance to a comprehensive small business program that establishes key performance indicators for those leading and working with your federal contracting team.  This is the first step in pursuit of being awarded the Dwight D. Eisenhower Award For Excellence – the SBA’s award for large prime contractors that have excelled in their utilization of small businesses as suppliers and subcontractors.

The main purpose of this post is to provide a few examples of the content that should be included in your firm’s manual and generate a few thoughts of what you think are relevant.  That said, this post is not a manual on the theory, structure, and format of drafting a policy and procedures manual.  (There are a number of great resources available to address those concerns.)  While many business share similar characteristics, such as business type, location, or market each firm is unique and must tailor the manual to fit its needs.

What should a policy and procedures manual for a small business program office contain?

  1. The CEO’s vision, intent, and policy letter articulating his or her intent. This will allow the team to operate effectively and efficiently with minimal supervision.
  2. The mission statement for the small business program.
  3. An organizational matrix and narrative outlining the small business team and its relationship to the company’s leadership and other departments. This is helpful because you may be asked to provide this during an audit.
  4. Federal subcontracting guidelines and definitions.
  5. A library of references, templates, and tools:
    1. Subcontracting plan templates for the various agencies
    2. Small business Self-certification forms
    3. Small business utilization tracking templates
    4. First tier large business subcontractor guidelines and notification letters
    5. Subcontracting plan review guidelines (to assist with the review of your first tier large business subcontractor subcontracting plans)
  6. A description of your firm’s ongoing small business outreach efforts. For example, what events, conferences, or functions centered on boosting small businesses does your firm participate in regularly.
  7. Guidelines for your firm’s participation in Mentor-Protégé Programs.
  8. Internal and external training programs on small business.

Benefits:

  1. The small business team will be able to operate more effectively and efficiently.
  2. Compliance efforts will be reduced.
  3. Streamlined integration with other departments.
  4. Potential gains in small business utilization.
  5. Stronger relationships with the small business community and potential long term strategic small business partners.

Resources:

Summary

There are a number of styles and approaches available to help you develop a policies and procedures manual, but the first step along the journey is to identify what is needed.  The manual should be a living document that can mature as your company refines its processes.  In addition, through the process of drafting the manual you will identify and correct processes and procedures that need improvement.  I have drafted compliance guides for clients which turned out be an enlightening experience.  Particularly during the interview process, clients realize there are weaknesses in their program that can have a negative impact on their small business program.  When you are ready, you can tackle the completion of your firm’s federal contracting policies and procedures manual addressing the full spectrum of contracting matters.

Standard Form (SF) 1413 Statement and Acknowledgement Compliance Tips

Overview

On 30 August 2013 I wrote an article describing submission requirements and compliance considerations for SF 1413s.  Since that time I have assisted a number of clients completing SF 1413s (for all tiers) and the post has had over a 1000 views, so I thought it is time to provide several additional tips.  As I mentioned in August, the SF 1413 is used by all executive agencies for all applicable subcontractors at all tiers to acknowledge they are aware of the required clauses stipulated in Federal Acquisition Regulation (FAR) 52.222-11.  Unfortunately there is very little published guidance available to assist contractors in completing the form.  The good news is it isn’t a complex form and with a few helpful tips the process can be more easily understood.

Compliance Tips

In the example below “Prime Contractor, Inc.” is the prime contractor, “1st Tier Subcontractor” is a first tier subcontractor, and “XYZ Plumbing” is a second tier contractor under “1st Tier Subcontractor”.  As this example progresses, I will highlight how lower tier subs are added to the process.

  1.  The Prime Contractor always goes in block 4 and executes blocks 10a through 12.  The subcontractor, regardless of tier, signing and acknowledging intent to comply with the listed clauses “Part II – Acknowledgement of Subcontractor” goes in block 5.SF 1413_EXAMPLE_1st tier Sub - Part I Graphic
  2. The firm awarding the work to the Subcontractor in block 5 is listed in 7.a. – “Name of Awarding Firm”.  At this point in the process it is “Prime Contractor, Inc.
  3. Any lower tier subcontractors are added in block 14:SF 1413_EXAMPLE_1st tier Sub - Part II Graphic
  4. Lower tier subcontractors listed in block 14 must complete a SF 1413 Statement and Acknowledgement form.  It is with the lower tier subcontractors I see the most mistakes made.  The prime contractor remains listed in block 4, however the new lower tier subcontractor, XYZ Plumbing, is now list in block 5.  The subcontractor (1st Tier Subcontractor) awarding the contract to XYZ Plumbing is listed in block 7a:SF 1413_EXAMPLE_2nd tier sub part I_Graphic
  5. XYZ Plumbing completes blocks 15 – 17 and forwards the prime contractor to complete the process and submit to the contracting officer.  According to regulation, the SF 1413s are required to completed within 14 days of subcontract award.

SF 1413_EXAMPLE_2nd tier sub part II_Graphic

Resources:

Several state level contracting offices, such as Arizona or Wisconsin, have published guidance on completing the form for their contracts.  In addition, the USACE Sacrmento District and the Fort Worth have published some guidance, but both documents are 12 and 14 years old, respectively.

Certified Payroll Compliance Tips

After a short break my next two articles will address certified payroll requirements and theCrane Hoist SF-1413 – Statement and Acknowledgement form.  Both have been areas of focus recently and the timing appears right to share my thoughts with the Federal contracting community at large.  This post will address three issues with certified payroll:

  1. When to start the submissions
  2. How to address gaps or breaks when work is not performed on site
  3. When to stop submissions

Overview

When prescribed in a contract (per FAR 22.407(a) the Payrolls and Basic Records clause is required in solicitations and contracts in excess of $2,000 for construction within the United States), Federal contractors are required to comply with Federal Acquisition Regulations (FAR) 52.222-8 – Payrolls and Basic Records.  This contract clause contains several requirements, but the essence of the clause as it relates to this post, stipulates that contractors accomplish the following:

  1. The Contractor shall submit weekly for each week in which any contract work is performed a copy of all payrolls to the Contracting Officer.  Paragraph 52.222-8(b) provides direction for the submission requirements.
  2. The records must be maintained for a period of three (3) years for all laborers and mechanics’ work at the site of work.

Beyond the guidance included in the FAR and provided by the Department of Labor Wage and Hour Division (WHD), specific instructions or procedures on how to address gaps in certified payroll submissions and when to stop collecting certified payroll the regulations are silent.  The rules simply state what is contained in the bullet #1 above.  In light of this, I advise clients, if they have not already done so, to develop a corporate policy and corresponding procedures for staff, project teams, and subcontractors to follow.

Policy and Procedures Recommendations (Underlined / Bold)

Current Federal Acquisition Regulations and Department of Labor instructions offer only general guidelines instructing contractors and subcontractors (all tiers) to submit certified payroll and a statement of compliance on Davis-Bacon and Davis-Bacon Related Acts covered contracts for the preceding work week.  This creates some ambiguity of how to address breaks in work by some subcontractors and when reporting is no longer required.

To provide standardized procedures for certified payroll we have issued the following guidance.  The intent is to provide a clear process to augment existing guidance.  Please refer to the instructions provided to our subcontractors for the submission of certified payroll:

  1. Submit reports and statement of compliance in a timely manner for all tiers.  The initial report and all subsequent reports are due the week following when work was performed on site.
  2. Submit “no work” performed reports for breaks in work if a sub has a short term break (for example less than three to four weeks) on the project.
  3. Submit a memo or letter stating “no work” to be performed for long term breaks (greater than four weeks) on this project.
  4. When a subcontractor or subsequent sub tier subcontractor is complete with their assigned work on the project, further reports are NOT required.  The last report will be marked as “final” to communicate their departure from the project site.  If they are called back then reporting would be required.

References:

Federal Acquisition Regulations

Department of Labor Wage and Hour Division

Department of Labor Field Operations Handbook – Chapter 15

Naval Facilities Engineering Command Davis-Bacon Contractors Guide (20070815)

Department of Housing and Urban Development – Making Davis-Bacon Work (June 2006)

Federal Contracting Subcontractor Payment & Retainage Considerations

After working with a client recently I thought it appropriate to discuss withholding and AIA_Billingretainage considerations for Federal contractors.  Similar to many other facets of government contracting, it is wise to be fully aware of the Federal Acquisition Regulation clauses in your contract and their impact on your business decisions.  So one tool a contractor has to encourage a particular behavior is to withhold payment from a subcontractor.  However, there are a few rules to live by.

Under the Prompt Payment for Construction Contracts Clause (FAR 52.232-27) payment to subcontractors is required within seven (7) days of receipt of funds paid to the Contractor.  Under this clause “Subcontractor Payment Entitlement” the contractor may not request payment from the Government any amount withheld or retained under this clause.  However, this clause does not limit or restrict the right of a contractor or subcontractor at any tier to retain (without cause) payment for work performed without incurring any obligation to pay late payment interest penalty.  The amount (percentage) to be retained is not stipulated in this clause, it is negotiated in the subcontract.  This allows flexibility based on unique factors of each subcontract.

Should this tool become necessary, the general requirements for retainage & withholding payment include:

  1. Provide notice to the subcontractor specifying:
    1. The amount withheld;
    2. The specific causes for the withholding under the terms of the subcontract; and
    3. The remedial actions to be taken by the subcontractor in order to receive payment of the amounts withheld.
  2. Provide a copy of the subcontractor notification to the Contracting Officer.

Under extenuating circumstances the determination of the need for retainage, or withholding payment from a subcontractor may be discovered after making a request for payment to the Government, but before making payment to the subcontractor.  If it is determined that all or a portion of the payment due to the subcontractor is subject to withholding under these circumstances, the following must be complied with:

  1. Subcontractor Notice – Provide notice as soon as practicable upon ascertaining cause for withholding, but prior to due date for payment to subcontractor {FAR 52.232-27(g)}.
    1. The amount withheld;
    2. The specific causes for the withholding under the terms of the subcontract; and
    3. The remedial actions to be taken by the subcontractor in order to receive payment of the amounts withheld.
  2. Contracting Officer Notice – Provide notice to the Contracting Officer (copy of the subcontractor notification), as soon as practicable {FAR 52.232-27(e)(1)}
  3. Subcontractor Progress Payment Reduction – reduce the subcontractor’s progress payment by an amount not to exceed the amount specified in the notice of withholding furnished to the Contracting Officer and Subcontractor {FAR 52.232-27(e)(1)}.
  4. Subsequent Subcontractor Payment – Pay the subcontractor as soon as practicable after the correction of the identified subcontractor performance deficiency, and;
    1. Make payment within seven (7) days after correction of subcontractor MoneyChangingHands_webperformance deficiency (unless funds must be recovered from the government).
    2. Make payment within seven (7) days after funds are recovered from the government.
    3. Contractor to incur an obligation to pay interest for late payments in accordance with FAR 52.232-27(e)(4)(ii).
  5. Notice to the Contracting Officer, upon:
    1. Reduction of the amount of any subsequent certified application for payment.
    2. Payment to the subcontractor (withheld amounts and corresponding dates of withholding).
  6. Interest to Government – Provide interest payment to the government as stipulated by FAR 52.232-27(e)(6) for late payments.

As with many contractual issues it is always recommended to discuss withholdings and retainage with legal counsel for any questions or concerns.

Federal Small Business Reporting

tech-ind

Overview

This month Other Than Small Business (OTSB) {also known as a large business (LB)} contractors and subcontractors (those holding a contract or subcontract in excess of $650,000 or $1,500,000 for construction) are required to submit their Individual Subcontract Reports (ISR) and Summary Subcontract Reports (SSR) via the Electronic Subcontract Reporting System (eSRS). For some construction projects this can be a time consuming event given the large number of subcontractors.  My typical client has 30 to 90 subcontractors depending on the size of the project.  On May 21st I authored a piece highlighting Small Business Utilization Monitoring and Reporting requirements.  This post calls into action the tips and techniques covered in that post as 30 September 2013 marked the end of the most recent reporting period.  The ISRs and SSRs are due within 30 days of that date.

Individual Subcontract Plan Reporting

The ISR reporting period is 1 April – 30 September and the project team (or group responsible for managing reporting) should have collected and categorized all of the subcontract awards related to the contract.  It is beneficial to start the reporting process early so it can be broken down into several discreet steps creating a more manageable process reducing interference with regular tasks the project team completes on a daily or weekly basis.  Below is an overview of the basic steps for those reporting on small business to complete:

  • Collect and organize all of the subcontract award data (i.e. business name, award date, and amount) made during the period sorting by business type, OTSB, WOSB, SDVOSB, etc.  This can be accomplished using Excel, Access, certain contract / project management databases, or paper and pencil.
  • Ensure the required self-certifications and HUBZone certifications are collected and reviewed for accuracy.
  • Ensure the correct subcontracting plan goals are entered for the ISR to be submitted.
  • Enter the required data in the eSRS ISR reporting tool.  There are several useful step by step guides with detailed instructions on the eSRS site.  Of note the ISR tool will calculate the participation rate percentages for you, although I prefer to calculate the small business (SB) participation rates prior to beginning the process.
  • If required, enter an appropriate remark explaining why goals have not been met.  Regardless if the goals are or are not being met, the team buying out the subcontracts should keep detailed notes on the bidding for each bid package.  This is very valuable information to use for remarks in the ISR in addition to any future contract work in the same region.

Summary Subcontract Reporting

There are a few differences between the ISR and the SSR in addition to a couple of tips that are worth noting.

  • The SSR is a fiscal year summary of Federal subcontracting activity reported by agency.  The more contracts and agencies a company works with the more complex the process becomes.  A common mistake I see is firms incorrectly totaling all of the ISRs for a particular agency and reporting that number.  ISRs are reports documenting subcontracting activity for the life of a contract.  Using the ISR in this manner will inflate the data in the SSR.
  • SSRs are reported at the agency level which creates one or more confusing aspects of submitting the SSR of “who”  or “where” to send it to from the range of choices available on the drop down menu.  The good thing is most agency personnel are very good at directing reports to the correct destination.
  • Similar to the ISR, there are several guides available on the eSRS site containing detailed instructions.  I recommend using the guides as they are helpful.

DoD Office of Small Business Programs (OSBP) recently updated is policy on SSRs and the Small Disadvantaged Business (SDB) participation report.  Highlights from the notice distributed several weeks ago are included below:

  • Starting in FY 2014 the SSR submission will be submitted once per year matching civilian agency requirements.
  • For FY 2013 reporting, contractors submit their consolidated SSR in eSRS to the Department of Defense (9700) and NOT to the department/agency which administers the majority of their subcontract plans.
  • For FY 2013 contractors should not submit the SDB participation report as they are no longer authorized since 10 U.S.C. 2323 expired.  For further guidance go to: http://www.acq.osd.mil/osbp/sbs/esrs.shtml

Summary:

  • Don’t procrastinate starting the reporting process and make sure time is left to review the data for accuracy and completeness.
  • If you have delegated the responsibility for data entry of the ISR, make sure you review the material before it is submitted.  Any errors will find their way back to you.
  • CEO or Senior VPs are required to sign the SSR, make sure they know the report is being submitted and they are briefed on the contents of the report.  Too often I have seen an electronic signature from the reporting authority used and not back-briefed on the event.

The Value of Developing a Federal Acquisition Regulation (FAR) Matrix Review During Proposal Development

Eagle with flag

Overview

Maintaining a proactive compliance stance in federal contracting is a tedious task requiring constant diligence and regular reviews.  Administrative reporting requirements and critically important performance requirements are sprinkled throughout the typical federal Request for Proposal (RFP).  Therefore, a key step in the proposal process is conducting a complete review of the FAR clauses in the proposal to set the stage for an active contract management and contract compliance stance.  There are numerous items for the home office and project teams to track.  For example, reporting requirements for subcontracts (which are reported on three separate occasions in many instances), small business reporting, improper business practices, annual representation and certification, I-9 verification requirements, cost & pricing certification requirements, and prompt payment issues (withholding procedures).  A detailed review provides several benefits highlighted below in addition to highlighting the previously mentioned requirements.

Benefits

  1. The overall benefit is it establishes the right mindset for a strong compliance program which reduces friction and interference from the contracting office.  Not only are there contractual requirements for completing certain reports, every contractor is required to annually assert they have complied with Previous Contracts and Compliance Reports as stipulated in clause 52.222-22.  Not doing so could expose a firm to problems associated with making a false statement.
  2. It provides an objective estimation of the level of effort the project team and corporate staff will incur as a result of a successful offer (the amount of required reporting increases with the size and complexity of the project).
  3. A review conducted during the proposal stage allows contractors to communicate with the procuring agency to eliminate errant clauses included in the RFP.
  4. Helps identity mandatory versus recommended FAR clauses for flowdown.
  5. Highlights actions required to comply with the various requirements.

Solutions

There are two solutions (actually there are three if you count doing nothing as an option) to conducting a FAR clause review and documenting the outcome.

  • One option is to build a FAR matrix manually using Excel, Word, or another software tool.  This option is the most time intensive since it involves reviewing the RFP, recording the clauses included in the contract, and briefly outlining each clause, its applicability, required reporting, flowdown requirements (mandatory or recommended), and other information your organization deems relevant.  When I used this method several years ago I slowly built a master file of clauses typically found in RFPs based on the procurement to help save time and effort.  An example is included below:

Article 12 FM Image

  • A second option is to use an automated tool that stores and updates all of the FAR and DFAR clauses for you.  Then all that is left is for your compliance team to do is review the RFP, select the clauses from the electronic list of clauses, and print the results.  I have found this option reduces the level of effort substantially.  An automated tool is not free of course, but it quickly makes up for itself in time saved.  Currently, I use a system designed by Wolters Kluwer (I am not affiliated with Wolters Kluwer and this is not a paid endorsement), and included a snapshot below:

Article 12 WK Image

Regardless of the option you select, either method will drive the compliance team to conduct a detailed review of the RFP developing a clear understanding of the contractual requirements upon award.  Also, it provides decision makers with the information needed to staff the project appropriately, identify any required training for the project team, subcontractors, or consultants, and ensure the company is complying with all applicable regulations.

Standard Form (SF) 1413 Statement and Acknowledgement Form – Compliance and Reporting Tips

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Overview

The SF 1413 is used by all executive agencies, including the Department of Defense and it fulfills several purposes in federal contracting.  First, it is used by the prime contractor to identify and report all applicable subcontracts (all tiers) awarded under the prime contract. Second, it identifies specific scopes of work the subcontractors will be performing, subcontract award date, and subcontract number.  Third, it provides formal notification to the applicable subcontractors of the labor laws and associated clauses they are responsible for complying with.  Since the form provides formal notification it is acknowledged by both parties and becomes a part of the contract.

Submission Requirements

The requirement for completing and submitting the SF 1413 is stipulated by Federal Acquisition Regulation (FAR) 52.222-11.  The clause states that contractors and subcontractors (all tiers) performing on a Federal contract involving construction in excess of $2,000 are required to submit a fully executed SF 1413 Statement and Acknowledgement within 14 days of award of each subcontract to the Contracting Officer.  In addition, the clause states the prime contractor is responsible for compliance by any subcontractor (all tiers) performing construction (within the United States) with the following contract clauses as listed in 52.222-11(b):

  1. Davis Bacon Act (52.222-6);
  2. Contract Work Hours and Safety Standards Act— Overtime Compensation (if the clause is included) (52.222-4);
  3. Apprentices and Trainees (52.222-9);
  4. Payrolls and Basic Records (52.222-8);
  5. Compliance with Copeland Act Requirements (52.222-10);
  6. Withholding of Funds (52.222-7);
  7. Subcontracts (Labor Standards) (52.222-11);
  8. Contract Termination—Debarment (52.222-12);
  9. Disputes Concerning Labor Standards (52.222-14);
  10. Compliance with Davis-Bacon and Related Act Regulations (52.222-13); and
  11. Certification of Eligibility (52.222-15)

Compliance Considerations

  1. Frequently I get questions such as “I am only providing painting or final cleaning services, why do I need to comply?”  Good question, and FAR 52.222-11 provides further clarification on additional scopes of work included along with other construction trades.  Without repeating the entire definition, the following bullets highlight the main elements included:
    1. Construction, alteration, or repair
    2. Remodeling and installation (items installed on site)
    3. Painting and decorating
  2. On larger more complex projects it is important for the project staff, or personnel responsible for compliance, to establish a well-defined process for distributing, collecting, and tracking completed forms for two main reasons:
    1. The 14 day timeframe doesn’t allow much time to complete and route the form for signature and submission; and
    2. The volume of forms required for multiple tiers may quickly overwhelm normal tracking methodologies used on small projects resulting in wasted time spent double checking the completion status.
  3. Other than the applicable FAR clauses there is not a significant amount of information readily available to provide guidance on completing the form should one have questions.  Although dated, several USACE districts (Corps of Engineers) have some helpful information posted on their sites.  In addition, several state level contracting offices, such as Arizona or Wisconsin, have published guidance on completing the form for their contracts.  However, I recommend caution as some information available on government websites for download is quite old and not helpful.  For example, the Secretary of Air Force Acquisition website has a version of the SF 1413 posted from 1992.  Therefore it is important to do a little research beyond the first hit on Google.

Overwhelmed with stacks of paper

Office of Federal Contract Compliance Programs (OFCCP) Compliance and Reporting

The summer break is over after a trip to the Delaware beaches to celebrate America’s Independence and a spectacular drive along the Beartooth Highway through Wyoming and Montana.  The Beartooth Highway is probably one of the most scenic drives I have taken.  But, back to Federal contracting reality…

The objective to this post is to provide a general overview of the OFCCP, with a focus on the construction industry, while covering a few specific areas to improve your company’s understanding of the compliance requirements.

EEO Poster Clip 2

What is OFCCP

OFCCP was created by Executive Order 11246 in 1965 and expanded by the Rehabilitation Act (1973) and the Vietnam Veterans’ Readjustment Assistance Act (1974).  OFCCP provides compliance enforcement and oversight for contractors and subcontractors compliance with the three laws.  Further, they must not discriminate in their employment practices on the basis of gender, race, color, religion, national origin, disability, or status as a protected veteran.

OFCCP is an agency within the Department of Labor with a national network of offices.  The National Office is located in Washington DC and there are six regional offices located in large metropolitan areas (Northeast, Mid-Atlantic, Southeast, Midwest, Southwest & Rocky Mountain, and Pacific).  Each region contains numerous district offices that carry out the mission of OFCCP.

The OFCCP mission

“The purpose of the Office of Federal Contract Compliance Programs is to enforce, for the benefit of job seekers and wage earners, the contractual promise of affirmative action and equal employment opportunity required of those who do business with the Federal government.”

In the context of OFCCP’s mission, it provides the following services:

Compliance Assistance

To minimize violations OFCCP has an extensive compliance assistance program to assist Federal contractors.  OFCCP uses its national network of regional, district, and area offices to provide compliance assistance to contractors.  OFCCP conducts seminars and workshops around the country, maintains a website with resources and tips, operates a help desk line during work hours, and provides an e-mail address for inquiries and feedback.  OFCCP also facilitates agreements between contractors and Department of Labor job training programs to help contractors identify and recruit qualified workers.

Compliance Evaluations

To monitor and ensure Federal contractors are in compliance with the EEO laws, OFCCP conducts compliance evaluations that review contractors’ employment practices.  Contractors are scheduled for review on a periodic basis, generally not more frequently than every two years.  OFCCP examines whether the contractor maintains hiring and employment practices that are nondiscriminatory, and determines whether the contractor is taking affirmative action to ensure that applicants and employees have an equal employment opportunity without regard to race, color, religion, sex, national origin, disability, or status as a protected veteran.  Typical practices reviewed include: job placement, employee training, promotion, compensation, and termination.  OFCCP also occasionally conducts other types of compliance evaluations, such as a Corporate Management Compliance Evaluation to determine whether qualified minorities, women, persons with disabilities, and protected veterans have encountered artificial barriers to advancement into mid-level and senior corporate management.

Complaint Investigations

OFCCP conducts investigations of complaints of discrimination filed by applicants or employees against Federal contractors.  OFCCP works in coordination with the EEOC when processing discrimination complaints.  OFCCP’s website provides information regarding how to file a complaint and how it will be processed at http://www.dol.gov/esa/ofccp/regs/compliance/pdf/pdfstart.htm.

Conciliation and Enforcement Action

If a compliance evaluation or complaint investigation yields a finding that a contractor violated any part of the regulations, OFCCP will attempt to first negotiate with the contractor to reach an appropriate remedy (“conciliation process”).  Generally, if the conciliation process is successful the contractor and OFCCP will sign a Conciliation Agreement.  The contractor will be expected to comply with the Agreement’s terms. If conciliation efforts fail, OFCCP and the Department of Labor’s Office of the Solicitor may pursue an enforcement action.

Basic Compliance Requirements

In most situations a company can remain compliant following the basic EEO requirements outlined in the Small Business Guide:

  • Don’t discriminate
  • Post an EEO poster
  • Include the EEO tagline in employment advertising:  “Federal contractors are required to state in all solicitations or advertisements for employment that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, or national origin.”
  • Keep detailed records
  • Open your books and records to OFCCP during an investigation or evaluation
  • File the required reports

References