Federal contractors need to document the most common compensable factors they use to set salaries because the Office of Federal Contract Compliance Programs (OFCCP) will want to see these factors if the agency conducts a compensation interview, according to speakers at the Society for Human Resource Management Employment Law & Compliance Conference 2022 on March 28 in Washington, D.C.
The most common compensable factors are time in job, time with company, external experience, education and certifications, said Thomas Carnahan, manager, compensation services, for Berkshire, based in Columbia, Md.
Federal contractors should start collecting data on these factors and consider a proactive pay equity audit as well, he said.
Lynn Clements, Berkshire's director, audit and HR services, added that a pay equity audit should be protected by the attorney-client privilege, despite the OFCCP's recent compensation directive.
Federal Contractors' Obligations
Supply and service federal contractors must perform in-depth analyses of their employment practices, including compensation systems, each year, Clements noted. A federal contractor must evaluate compensation systems to determine whether there are gender-, race- or ethnicity-based disparities.
As of this year, federal contractors must certify, by June 30, that they have an affirmative action program for each establishment and must do so each year thereafter, if they are in compliance and have one per establishment.
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