Affirmative Action 101 Presented by: Nicolas Paul

Kairos Services, Inc.

Agenda

• Covering the Basics

• Secrets for Improving your AAP Results

• Adverse Impact Shortfall Backpay

• Applicant Flow & Dispositions

• OFCCP Audit Hot Topic – Websites Compliance

• Veteran and Disability Data Collection & Analysis

Disclaimer

The content provided herein by Kairos Services, Inc.

is for informational purposes only and not a

substitute for professional advice. You should seek

independent advice from one of our professionals

before acting upon any opinion or information

contained in this presentation.

Coverage

Who must prepare written AAPs?

• Criteria for AAP

– 50 or more employees

– A contract of $50,000 or more

– Government bills of lading reasonably expected to total

$50,000 or more

– A depository of Government funds

– *Subcontractor Status

Consequences of Non-Compliance

• Back pay or other financial remedies

• Negative Press

• Company wide debarment

– 8/1/16 - COLONIAL PARKING, INC. SETTLES CHARGES OF HIRING, PAY DISCRIMINATION WITH US

LABOR DEPARTMENT AFTER CONTRACTOR COMPLIANCE REVIEW - Agrees to pay nearly $250K to African-American applicants

– 7/5/16 - DIVISION OF NORFOLK SOUTHERN SETTLES CHARGES OF HIRING DISCRIMINATION AT ROANOKE FACILITY IN AGREEMENT WITH US LABOR DEPARTMENT - Federal contractor to pay nearly $500K to 2,086 African-American applicants

– 6/21/16 - JENNIE-O TURKEY STORE TO PAY $492K IN BACK WAGES TO 339 FEMALE APPLICANTS AFTER US LABOR DEPARTMENT INVESTIGATION FOUND HIRING DISCRIMINATION

‘Data as of’ and AAP Plan Year Dates

What The Dates Mean

• AAP Year

– The 12 month period during which the AAP is valid

– Example: An AAP year can be from January 1 to December

31, 2016 (calendar year of 2016)

• Data Dates for AAP

– The workforce snapshot date (“as of” date)

– The personnel actions used for the preparation of this AAP

would be for the prior 12 months (calendar year of 2015)

What are my options for

organizing my AAP?

The Basics

• Options in organizing your AAPs

– Standalone

– Roll to AAP with Manager

– Roll to AAP where HR function is that supports group

• Considerations in the final decisions

– Accountability

– Narrowing risk

The Reports

Basic AAP Required Reports

Workforce

Analysis

Job Group

Analysis

Availability

Analysis

Incumbency

vs. Availability

Placement

Goals

Prior Year

Placement

Goals

Job Groups and the

Job Group Analysis

Creating Job Groups

• Job Group Creation

– Job Content

– Opportunity

– Progression

Job Group Analysis

• The basic unit of analysis

• Foundation for the rest of your AAP

– Goals

– Adverse Impact

• Hiring

• Promotions

• Terminations

Availability and the

Availability Analysis

Availability Analysis

What is “External” Availability?

What is “Internal” Availability?

What is “Weighting”?

Final Availability and Underutilization

Final Availability

• What is “Final Availability”?

– The representation of females and minorities you should

have given your external and internal practices of hiring,

promoting and transferring people into a particular job

group.

Underutilization

What is “Underutilization”?

• Having materially fewer minorities or women in a particular

job group than would be reasonably expected given

availability.

Comparison of Incumbency to Availability

I’m underutilized. Now what?

Placement Goals

• Current Year Placement Goals

• Goals = Availability

• Placements

– Hires

– Promotions

Prior Year Goals

Prior Year Placement Goals Report

33.3%

•Minority Goal for Administrative Support

•Total hires into this job group = 7 (0 are Minorities)

•Total promotions into this job group = 6 (1 is Minority)

?

•How many total placements were there into this job group?

(Hint: Placements = Hires + Promotions)

•How many of these were Minority placements?

?

•What was the Minority placement rate?

•Was the goal accomplished?

How do I show my good side?

Improving Your AAP Results

• Re-create Job Groupings

• Re-visit Census Mapping

• External vs. Internal Availability Weights

• Recruitment Areas

• Feeder Pools

Today’s most important lesson…

Impact Ratio Analysis

Adverse

Impact Shortfall

Back

Pay

Adverse Impact

• What is Adverse Impact?

– A substantially different rate of selection in hiring,

promotions or termination

– Comparison of favored group vs disfavored group

Standard Deviation

• What is a Standard Deviation? – Standard deviation is a numerical value used to indicate how widely

individuals in a group vary. If individual observations vary greatly from

the group mean, the standard deviation is big; and vice versa.

What Are The Odds?

Standard Deviation Chance Hand of Cards (approx)

1.0 SD 3.2 in 10 1 Pair

2.0 SD 5 in 100 2 Pair

3.0 SD 3 in 1,000 Straight

4.0 SD 6 in 100,000 4 of a kind

5.0 SD 6 in 10 million Royal Flush

6.0 SD 2 in 1 billion Something is amiss!!

TECHNOLOGY INC. Dallas, Texas

IMPACT RATIO ANALYSIS

1/11/15 - 12/31/15

NEW HIRES

LABORERS & HELPERS (8)

Category Hired Applicants Selection Impact Factor Adverse Std.

Rate Ratio Impact Dev.

Non-Minority 52 900 5.8% 238.3% FAVORED NO

Minority 16 660 2.4% 42.0% YES 3.20

Black 0 244 0.0% 0.0% YES 3.84

Hispanic 12 188 6.4% 110.5% NO

Asian 4 116 3.4% 59.7% YES 1.03

Native Amer. 0 8 0.0% 0.0% YES*

TOM 0 24 0.0% 0.0% YES*

Male 62 1272 4.9% 234.0% FAVORED NO

Female 6 288 2.1% 42.7% YES 2.09

Shortfall Defined and Calculated

• “Shortfall”: the number of positions a company falls

short of selecting.

• How is it calculated?

Shortfall Calculation

Laborers

Job Group

660 x 4.4% =

29

29 – 16 =

13

Applicants

OSR (hires/applicants)

Shortfall

Hired

Back Pay

• What is Back Pay?

– It is not a Fine or a Penalty

– It is the Value of a Position

• How is Back Pay Calculated?

– Start with Shortfall x average annual salary

Back Pay Calculation

Laborers

Job Group

$8 x 2080 =

$16,640

$16,640 x 13 =

$216,320

More Back Pay?

• In addition to wages, OFCCP’s calculation of back

pay includes:

– Benefits

– Overtime

– Shift differentials

– Raises

– Bonuses

The Numbers Game

Big Numbers are Bad Numbers

Job Group: Managers & Supervisors (1)

Category Hired Applicants Selection Impact Factor Adverse Std.

Rate Ratio Impact? Dev.

Non-Minority 2 8 25.0% 100.0% FAVORED NO

Minority 1 4 25.0% 100.0% NO

Black 1 2 50.0% 200.0% NO

Hispanic 0 2 0.0% 0.0% YES*

Asian 0 0 0.0% N/A NO

Native Amer. 0 0 0.0% N/A NO

TOM 0 0 0.0% N/A NO

Male 2 10 20.0% 40.0% YES 0.89

Female 1 2 50.0% 250.0% FAVORED NO

Job Group: Managers & Supervisors (1)

Category Hired Applicants Selection Impact Factor Adverse Std.

Rate Ratio Impact Dev.

Non-Minority 4 16 25.0% 100.0% FAVORED NO

Minority 2 8 25.0% 100.0% NO

Black 2 4 50.0% 200.0% NO

Hispanic 0 4 0.0% 0.0% YES*

Asian 0 0 0.0% N/A NO

Native Amer. 0 0 0.0% N/A NO

TOM 0 0 0.0% N/A NO

Male 4 20 20.0% 40.0% YES 1.26

Female 2 4 50.0% 250.0% FAVORED NO

Big Numbers are Bad Numbers

Job Group: Managers & Supervisors (1)

Category Hired Applicants Selection Impact Factor Adverse Std.

Rate Ratio Impact Dev.

Non-Minority 8 32 25.0% 100.0% FAVORED NO

Minority 4 16 25.0% 100.0% NO

Black 4 8 50.0% 200.0% NO

Hispanic 0 8 0.0% 0.0% YES 1.58

Asian 0 0 0.0% N/A NO

Native Amer. 0 0 0.0% N/A NO

TOM 0 0 0.0% N/A NO

Male 8 40 20.0% 40.0% YES 1.79

Female 4 8 50.0% 250.0% FAVORED NO

Job Group: Managers & Supervisors (1)

Category Hired Applicants Selection Impact Factor Adverse Std.

Rate Ratio Impact? Dev.

Non-Minority 32 128 25.0% 100.0% FAVORED NO

Minority 16 64 25.0% 100.0% NO

Black 16 32 50.0% 200.0% NO

Hispanic 0 32 0.0% 0.0% YES 3.16

Asian 0 0 0.0% N/A NO

Native Amer. 0 0 0.0% N/A NO

TOM 0 0 0.0% N/A NO

Male 32 160 20.0% 40.0% YES 3.58

Female 16 32 50.0% 250.0% FAVORED NO

What’s the big deal about

Applicant Flow Logs?

Common Applicant Flow Issues

• No applicant flow data

• High applicant to hire ratios

• Low applicant to hire ratios

• Race and gender information

• Recruitment source data

• Dispositions, Dispositions, Dispositions!!!

– Status Codes

OFCCP Hot Topic

Website Compliance

• Updated EEO Tagline (for home and careers webpages)

• Language for Reasonable Accommodation Requests (for careers webpage)

• Language for “EEO is the Law" Poster + Supplement (for careers webpage)

• Pay Transparency Statement (for careers webpage)

• E-Verify (for careers webpage)

Veterans and Individuals with Disabilities

Data Collection & Analysis

Veteran Data Collection

• Pre-Offer

– “Yes” / “No” / “Refuse to Answer”

• Post-Offer

– “Yes” / “No” / “Refuse to Answer” / “Yes” but refuse to answer category

• “Yes” Categories

– Disabled Veteran

– Recently Separated Veteran

– Active Wartime or Campaign Badge Veteran

– Armed Forces Service Medal Veteran

• Resurvey Not Required

• HRIS / ATS Fields

VEVRAA – 6.9% Hiring Benchmark

• The hiring benchmark in VEVRAA provides a

yardstick against which contractors can measure

the success of their efforts to recruit and employ

qualified protected veterans.

– Benchmark based on overall hiring rate

Have I met my hiring benchmark?

Disability Data Collection

• Pre-Offer

– “Yes” / “No” / “Refuse to Answer”

• Post-Offer

– “Yes” / “No” / “Refuse to Answer”

• Resurvey Every Five Years

– Reminder during the intervening five years

• HRIS / ATS Fields

Section 503 –7% Utilization Goal

• A goal serves as a yardstick to measure the success of outreach and recruitment efforts and provides an equal opportunity objective, based on the availability of members of the protected group in the labor force, that should be attainable if the contractor complies with its affirmative action program.

– 100 or fewer employees – Goal Established for overall workforce

– More than 100 employees – Goal Established by Job Group

Section 503 Utilization Report

Section 503 Utilization Report

For Additional Information contact: Nicolas Paul

Director of Operations

Phone: (972) 369-0015 Nick@KairosServicesInc.com www.KairosServicesInc.com