OFCCP Rescinds Compensation Standards

 

On February 26, the Office of Federal Contract Compliance Programs (OFCCP) officially rescinded the 2006 compensation standards and voluntary guidelines for contractor compensation compliance. The OFCCP also announced Directive 307, which offers some guidance on how future compliance evaluations will be handled.

The OFCCP requested that the compensation guidelines issued in 2006 be rescinded because, purportedly, they are unnecessarily narrow and limit the OFCCP’s ability to investigate cases of potential discrimination in compensation. As the OFCCP has stated, per current case law and Title VII standards, there are many ways to prove compensation discrimination, and the OFCCP needed to remove the guideline’s restrictions on compliance reviews.

“Practically, all this does is make official the OFCCP’s activities over the past few years,” says Sandie Harrison, manager of MSEC’s Affirmative Action Services. Directive 307 instructs compliance officers to review all compensation data and pursue additional information on factors that may indicate differences in pay, even down to an individual-employee level. “The OFCCP has been doing this for the past two to three years, so this is really nothing new. Regardless, the OFCCP’s determined focus on compensation issues is clear.”