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Federal contractors received a shock on January 21, 2025, when executive changes suddenly transformed how OFCCP compliance audits will be conducted.
President Trump’s revocation of Executive Order 11246–the primary executive order promoting non-discrimination and equality requirements in federal contracting–left many contractors questioning their compliance obligations.
To cut through the confusion, I consulted with leading compliance experts, including employment attorneys. Their insights reveal a clear picture of what contractors need to know (and do) to maintain compliance in this new regulatory environment.
Continue reading to learn how to prepare for OFCCP compliance audits going forward. You’ll also get a free downloadable OFCCP compliance checklist at the end of the article.
What has changed in OFCCP audits? 2
How can contractors prepare for OFCCP audits? 3
Get hold of the following audit preparation documents 3
Assess your internal processes and training 4
Create and document your response strategy 4
Understanding OFCCP audit results 5
Conciliation Agreements (CA) 6
Here’s your OFCCP compliance checklist 6
What is an OFCCP audit?
An OFCCP audit is a compliance evaluation carried out by the Office of Federal Contract Compliance Programs (OFCCP). This audit’s goal is to ensure that you, as a federal contractor (or subcontractor), provide equal employment opportunities.
The OFCCP audits your:
- Hiring, promotion, and termination practices.
- Personnel activity and compensation data.
- Job requirements, descriptions, and tests.
But with the recent changes happening to the OFCCP, what would audits look like going forward?
Read Also: 6 steps to make your job postings OFCCP compliant
What has changed in OFCCP audits?
I asked Adrien Kallel, global workforce compliance expert, what he thought the future of OFCCP audits would look like. His response was prophetic.
“Organizations will continue to face OFCCP audits but differently. EO 11246’s revocation strips OFCCP’s authority to audit race/gender affirmative action plans. Audits will pivot to statutory mandates: disability (Section 503) and veteran hiring (VEVRAA). These remain enforceable because they’re rooted in laws, not executive orders. Expect audits to focus on compliance with these unchanged obligations.”
Days later, OFCCP released its first statement informing contractors of President Trump’s order, confirming almost everything Adrien told me.
Here’s what you should know.
As of this moment, OFCCP announced that all audits under the EO11246 will cease to be enforced immediately. This applies to all pending audits, open compliance reviews, complaints and conciliation agreements related to EO 11246.
According to OFCCP’s message, the body will stop:
- Promoting “diversity”.
- Holding Federal contractors and subcontractors responsible for taking “affirmative action”; and
- Allowing or encouraging Federal contractors and subcontractors to engage in workforce balancing based on race, color, sex, sexual preference, religion, or national origin.
But what remains the same?
Like Adrien told me, the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) and Section 503 of the Rehabilitation Act will remain in effect because they are statutory.
This means you’re still required to comply with your affirmative actions and obligations regarding protected veterans and individuals with disabilities. However, OFCCP’s review of contractors compliance under these requirements have been temporarily suspended.
Note that this doesn’t mean that contractors should stop complying with section 503 or VEVRAA.
How can contractors prepare for OFCCP audits?
While audits might be temporarily suspended, the press release from OFCCP tells us they’ll return. When they do–and you receive that scheduling letter–you’ll need to be prepared.
I’ve compiled a comprehensive checklist to help you navigate the audit process successfully.
Get hold of the following audit preparation documents
Documentation is the backbone of your audit defense. You’ll need to maintain and organize:
- Your current Affirmative Action Plan (AAP)
- Complete applicant data, including self-identification information for protected veterans and individuals with disabilities.
- Records of your promotion and termination decisions
- Recruiting documentation
- Current compensation data across all employee levels
David Gammill, a lawyer with experience working on compliance cases, told me why documentation is paramount.
“If you’re scrambling to find things when the OFCCP asks for them, it’s going to raise eyebrows. I’ve also seen situations where poor documentation made it hard to defend legitimate practices. For example, if you promoted someone based on strong performance, but you don’t have performance reviews or other records to back that up, it can look suspect even if there was no discrimination involved.”
You need documentation to explain and justify your decisions in a consistent way.
Assess your internal processes and training
Implement training sessions with staff involved in hiring, promotion, and compensation, decisions to go over your internal processes. These sessions should cover:
- Your AAP implementation procedures
- Documentation protocols
- Response procedures for compliance inquiries
Benson Varghese, Managing Partner at Varghese Summersett, recommended that contractors go one step further and conduct a “reverse audit”. He explained:
“A “reverse audit” by an external legal team or consultant before OFCCP contact is an uncommon but successful way to prepare for audits. Unlike internal reviews, where teams might unknowingly overlook compliance gaps, an external perspective can bring an unbiased, critical eye to the process. For one client, we conducted a reverse audit that included mock interview sessions with HR staff and simulated document requests. This not only identified vulnerabilities—like outdated job descriptions and inconsistent pay band documentation—but also trained their team to respond confidently under real audit conditions. This strategy smoothed the OFCCP audit and improved the organization’s compliance framework, preventing a six-figure penalty. This proactive, out-of-the-box strategy uncovers hidden hazards and improves readiness.”
Create and document your response strategy
Finally, you need to develop a clear plan for managing audit responses. This includes:
- Assigning specific responsibilities to your compliance team
- Creating templates for common audit requests
- Establishing a review process for all audit submissions
- Maintaining organized, easily accessible compliance documentation
When OFCCP operations resume fully, maintain open communications with compliance officers. This can help you facilitate a smoother audit process and better outcomes.
Understanding OFCCP audit results
When OFCCP concludes its review of your organization, you’ll receive one of several possible outcomes.
I’ll break down what each outcome means for your organization and the steps you might need to take.
Notice of Compliance (NOC)
A Notice of Compliance is the ideal outcome of your audit. It represents a clean bill of health for your organization’s OFCCP compliance.
Notice of Violation (NOV)
A Notice of Violation is a formal alert about specific compliance issues. It tells you what needs to be fixed and proposes solutions you must take.
There’s another notice OFCCP might serve you if they discover potential violations–Predetermination Notice (PDN). PDN indicates that there are potential discrimination findings that could lead to financial penalties and the contractor has an opportunity to present additional evidence before the OFCCP makes their final judgement.
Conciliation Agreements (CA)
If the NOV or PDN don’t lead to a resolution, OFCCP will propose a Conciliation Agreement (CA). It is a negotiated settlement between the contractor and OFCCP so the violations don’t result in litigation. CA comes in two forms.
Non-Financial Conciliation Agreements: focus on fixing operational issues like:
- Recordkeeping procedures
- Outreach programs
- Recruitment processes
Financial Conciliation Agreements: focus on more serious concerns, typically involving discrimination allegations that may require:
- Back pay for affected employees
- Compensation adjustments
- Other monetary remedies
Consent Decrees
In rare cases where organizations can’t reach agreement with OFCCP, the matter moves to court. If the court rules in favour of OFCCP, the contractor gets a Consent Decree as an outcome–a serious outcome. It’s similar to Conciliation Agreements but with additional oversight and consequences for non-compliance.
Here’s your OFCCP compliance checklist
I’ve created a comprehensive OFCCP compliance checklist that you can download right now. It will help you stay compliant with Section 503 and VEVRAA requirements.
