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Federal Construction Contractors and the OFCCP Audit


OFCCP AuditLast week the Construction Financial Management Association (CFMA) Valley of the Sun Chapter had the pleasure of hearing from two fabulous Senior Compliance Officers, Mary Sneed-Hill and Cheryl Davis from the Office of Federal Contract Compliance Programs (OFCCP). As most road projects in Arizona are either Federal Contracts or Federal Assisted, there are a few compliance issues that will most likely come up when an Onsite Investigation commences. Records retention is paramount in avoiding violations and construction firms must prepare and educate more than just their Human Resources and Payroll departments.

All personnel and employment records made by the contractor must be preserved for at least two years for larger contractors, contractors with fewer than 150 employees or contracts less than $150,000, records must be kept for at least one year. These do not need to be in electronic format. You will find that electronic systems your contracting firm uses to distribute invitations to bid may not offer the ability to maintain copies of subtract solicitations to minority and female-owned businesses, a record of responses, and any follow-up within them. Computer based project management systems, estimating software and accounting solutions each may have a subset of the overall records you will need to produce in an OFCCP audit. It is likely that your standard systems will not track or produce all the necessary documentation.

The Phoenix District office of OFCCP shared that the most common record keeping error (found in 42 of 50 contractor’s evaluations in western states) is not following the Subcontractor Award Notification 41 CFR 60-4.2(d)(3) requiring you notify the OFCCP within 10 days of awards greater than $10,000. If you are new to federal contracting or haven’t had an audit yet. It’s best to be proactive and send in the notifications you forgot to (even when they are late). Perhaps some of the Bidding and Estimating systems will be proactive themselves in adding this form and a scheduled action or reminder to keep contract administrators on task for OFCCP compliance. Here’s a sample Subcontractor Award Notification form from OFCCP so you aren’t part of the 84% statistic:Notification of Award of Construction Contractors

Additional information can be found in the Technical Assistance Guide (PDF). Anyone may contact OFCCP for assistance interpreting the regulations, filing a complaint or other compliance matters
San Francisco Regional Office: (415) 625-7800
Phoenix District Office: (602) 514-7074
Las Vegas Field Office: (702) 388-6897


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