Adverse Impact: An adverse impact occurs when a contractor’s use of a facially neutral policy or selection procedure (e.g., a test, an interview, a degree requirement, leave or hours policy) disqualifies members of a protected class at a substantially higher rate than others.

Disparate Impact: A theory of employment discrimination that focuses on the effect of a practice or policy. Disparate impact discrimination occurs when a contractor’s use of a facially neutral policy or practice (e.g., a test, an interview, a degree requirement, a leave or hours policy) disqualifies members of a protected class at a substantially higher rate than others and is not justified by business necessity and job-relatedness (or it is justified by business necessity but there are less-discriminatory alternatives available that would meet the contractor’s need). It is not necessary to prove intent to discriminate under this theory of employment discrimination. The disparate impact theory may be used to analyze both objective and subjective selection standards.

Disparate Treatment: Disparate treatment discrimination occurs when a contractor treats an individual or group less favorably on the basis of a prohibited factor (race, color, religion, sex, sexual orientation, gender identity, national origin, disability, status as a protected veteran, or because the individual or group of individuals has disclosed, discussed or inquired about compensation). It is necessary to prove intent to discriminate under this theory of employment discrimination, which is sometimes referred to as “intentional discrimination.” Disparate treatment may be proven using direct evidence, circumstantial evidence or a combination of both.

Affirmative Action: Actions, policies, and procedures to which a contractor commits itself that are designed to achieve equal employment opportunity. Affirmative action obligations entail thorough, systematic efforts to prevent discrimination from occurring and to detect it and eliminate it as promptly as possible. Affirmative action obligations also require contractors to ensure equal opportunity in their recruitment and outreach efforts.

Affirmative Action Program (AAP): A management tool designed to ensure equal employment opportunity. The requirements for affirmative action programs that satisfy Executive Order 11246, Section 503 and VEVRAA, are outlined in 41 CFR Part 60-2, 41 CFR Part 60-741, Subpart C, and 41 CFR Part 60-300, Subpart C, respectively. These include requiring a contractor to annually detail the affirmative steps it has taken and will take in the future to ensure equal employment opportunity.

Action-oriented programs: The contractor must develop and execute action-oriented programs designed to correct any problem areas identified and to attain established goals and objectives.

Compliance Evaluation: The investigation and review process used by OFCCP to determine whether a federal contractor is complying with the nondiscrimination and affirmative action employment obligations.

Good Faith Efforts: A contractor’s appropriate efforts to meet its Executive Order 11246 goals by removing identified barriers, expanding employment opportunities and producing measurable results.

Noncompliance: A contractor’s failure to adhere to the conditions set out in the contract’s equal opportunity clauses or the regulations implementing those clauses, or failure to correct violations.

Uniform Guidelines on Employee Selection Procedures (UGESP): Guidelines developed by the EEOC, U.S. Department of Justice, U.S. Department of Labor and the Civil Service Commission (now the Office of Personnel Management) to provide a single set of principles that are designed to assist employers, labor organizations, employment agencies, and licensing and certification boards to comply with requirements of federal law prohibiting employment practices that discriminate on grounds of race, color, religion, sex and national origin.

Violation: Failure to fulfill a requirement of the Executive Order 11246, Section 503 or VEVRAA, or their implementing regulations.

Workforce Analysis: A workforce analysis is a listing of each job title as appears in applicable collective bargaining agreements or payroll records ranked from the lowest paid to the highest paid within each department or other similar organizational unit including departmental or unit supervision.

Identification of problem areas: The contractor must perform in-depth analyses of its total employment process to determine whether and where impediments to equal employment opportunity exist.

Impact Ratio Analysis (IRA): A method for identifying personnel activity that should be investigated further. The IRA is a comparison of the selection rates of different racial, ethnic and sex groups within an identified applicant or candidate pool. If the selection rate for one group is less than 80% of that of the group with the highest rate, then the IRA is considered adverse and further investigation or analysis is needed.

Job group analysis: A job group analysis is a method of combining job titles within the contractor's establishment. This is the first step in the contractor's comparison of the representation of minorities and women in its workforce with the estimated availability of minorities and women qualified to be employed.

Organizational profile: An organizational profile is a depiction of the staffing pattern within an establishment. It is one method contractors use to determine whether barriers to equal employment opportunity exist in their organizations. The profile provides an overview of the workforce at the establishment that may assist in identifying organizational units where women or minorities are underrepresented or concentrated.

Standard Deviation: As an alternative to probability values, statisticians often express the divergence between actual and expected outcomes in units called standard deviations. The larger the difference in standard deviations, the smaller the probability that the difference is due to random chance factors alone.

Statistical Evidence: Statistical evidence means hypothesis testing, controlling for the major legitimate, nondiscriminatory measurable parameters and variables used by employers (including, as appropriate, other demographic variables, test scores, geographic variables, performance evaluations, years of experience, quality of experience, years of service, quality and reputation of previous employers, years of education, years of training, quality and reputation of credentialing institutions, etc.), related to the probability of outcomes occurring by chance and/or analyses reflecting statements concluding that a difference in employment selection rates or compensation decisions is statistically significant by reference to any one of the following equivalent statements: 1) the disparity is two or three times larger than its standard error (i.e., a standard deviation of two or more); 2) the Z statistic has a value greater than two or three; or 3) the probability value is less than 0.05 or 0.01.

Statistically Significant: The results of statistical analyses (statistical evidence) are “statistically significant” if the probability the results occurred by chance is so small that chance can reasonably be ruled out as the cause. When the difference between actual and expected values is greater than 1.96 standard deviations, the probability the disparity occurred by chance is less than 5%. In employment discrimination cases, courts generally consider a difference of two or more standard deviations to be “statistically significant” and allow a valid statistical inference of discrimination to be drawn.

Systemic Discrimination: Systemic discrimination involves a pattern or practice, policy or class case where the alleged discrimination has a broad impact on an industry, profession, company or geographic area. Examples of systemic practices include: discriminatory barriers in recruitment and hiring, discriminatorily restricted access to management trainee programs and high-level jobs, exclusion of qualified women from traditionally male-dominated fields of work, and disability discrimination such as unlawful pre-employment inquiries. There is no specific numeric threshold used to define a systemic case.

Support Data: Statistical data, documentation and other materials regarding a contractor’s employment policies, practices and actions used in the development, support and justification of its affirmative action program(s), or used to assess the affirmative action program’s effectiveness.

Applicant: A person who has indicated an interest in being considered for hiring, promotion or other employment opportunity. This interest may be expressed in different ways, such as by completing an application or through an oral statement, depending upon the contractor’s practice. An employee of a company may also be an “applicant” when he or she has indicated an interest in being considered for another job, promotion or employment opportunity within the company.

Basic Qualifications (Internet Applicant): Basic qualifications is a key concept in the definition of an Internet Applicant. To be considered an Internet Applicant, an individual’s expression of interest in a position must indicate that “the individual possesses the basic qualifications for the position.”

“Basic qualifications” mean qualifications: That the contractor advertises (e.g., posts on its website in a description of the job and the qualifications involved) to potential applicants that they must possess to be considered for the position; or For which the contractor established criteria in advance by making and maintaining a record of such qualifications for the position before considering any expression of interest for that particular position if the contractor does not advertise for the position but, instead uses an alternative device to find individuals for consideration (e.g., through an external resume database); and That meets all of the following three conditions: The qualification must be noncomparative features of a job seeker. For example, three years of experience in a particular position is a noncomparative qualification; a qualification that an individual has one of the top five years of experience among a pool of job seekers is a comparative qualification. The qualifications must be objective; they do not depend on the contractor’s subjective judgment. A qualification is objective if a third party, with the contractor’s technical knowledge, would be able to evaluate whether the job seeker possesses the qualification without more information about the contractor’s judgment. For example, “a bachelor’s degree in accounting” is objective while “a technical degree from a good school” is not. The qualifications must be relevant to the performance of the particular position and enable the contractor to accomplish business-related goals.

Internet Applicant: Any individual as to whom the following four criteria are satisfied: The individual submits an expression of interest in employment through the internet or related electronic data technologies; The contractor considers the individual for employment in a particular position; The individual’s expression of interest indicates the individual possesses the basic qualifications for the position; and, The individual does not remove him or herself from further consideration or otherwise indicates that he or she is no longer interested in the position.

Job Area: Any sub-unit of a workforce sector (e.g., department, job group, job title, line of progression).

Job Area Acceptance Range (JAAR): An analytical tool used to analyze the distribution of employees in a workforce by comparing the actual percentage of minorities and women in a job area to their percentage in the relevant segment of the contractor’s workforce.

Job Categories: The 10 designated categories of the EEO-1 report: officials and managers (divided into executive/senior level and mid/first level); Professionals; Technicians; Sales Workers; Office and Clerical; Craft Workers (skilled); Operatives (semi-skilled); Laborers (unskilled); Service Workers

Job Group: One or more group(s) of jobs having similar content, wage rates and opportunities.

Labor Area: The Geographic area used in calculating availability. The area may vary from local to nationwide.

Similarly Situated Employee Group (SSEG): SSEGs are used in examining potential compensation discrimination. SSEGs are sometimes referred to as a pay analysis groups and are viewed by the agency as equivalent terms. An SSEG is a group of employees (potentially from multiple job titles, units, categories and/or job groups) who are comparable for purposes of analyzing a contractor’s pay practices, based on: (a) job similarity (e.g., tasks performed, skills required, effort, responsibility, working conditions and complexity); and (b) other objective factors such as minimum qualifications or certifications.

Uniformly Applied: Applying employment criteria or processes in the same manner to all similarly situated applicants or employees.

Affected Class: A group of people sharing common traits or characteristics (e.g., the same race, sex, or ethnicity) who are the victims of systemic discrimination by a particular contractor during a specific timeframe.

Minorities: Minorities include individuals who are Black, Hispanic, Asian or Pacific Islander, American Indian or Alaskan Native

Prohibited Basis or Prohibited Factor: A basis or factor prohibited by law from being used in making employment decisions. Under Executive Order 11246, as amended, the prohibited bases or factors: Race; Color; Religion; Sex; Sexual Orientation; Gender Identity; and National Origin. Under Section 503, the prohibited basis or factor is a disability. Under VEVRAA, the prohibited basis or factor is status as a protected veteran.

Protected Group or Category: The bases on which applicants and employees are protected from discrimination in employment under the laws enforced by OFCCP (also referred to as “prohibited factors” or “prohibited bases”): race, color, religion, sex, sexual orientation, gender identity, national origin, disability and status as a protected veteran.

Qualified Individual (with a Disability): An individual with a disability who satisfies the requisite skill, experience, education and other job-related requirements of the employment position the individual holds or desires, and who with or without reasonable accommodation can perform the essential functions of such position. See 41 CFR 60-741.2(r). For exceptions to this definition, see 41 CFR 60-741.3.

Protected Veteran: Any veteran who is protected by VEVRAA. To be a “protected veteran,” a veteran must meet the criteria of one or more of the following four categories: Disabled Veteran; Recently Separated Veteran; Active Duty Wartime or Campaign Badge Veteran; Armed Forces Service Medal Veteran.

Uniform Guidelines on Employee Selection Procedures (UGESP): Guidelines developed by the EEOC, U.S. Department of Justice, U.S. Department of Labor and the Civil Service Commission (now the Office of Personnel Management) to provide a single set of principles that are designed to assist employers, labor organizations, employment agencies, and licensing and certification boards to comply with requirements of federal law prohibiting employment practices that discriminate on grounds of race, color, religion, sex and national origin.

Reasonable Recruitment Area: The geographic area from which the contractor usually seeks, or reasonably could seek, workers to fill jobs within a particular job group.

Recruitment Source: Any person, organization or agency used to refer or provide workers for employment.

Invitation to Self-Identify: An invitation by the contractor, extended to employees and applicants for employment, to voluntarily identify their race, sex, ethnicity, disability, and/or protected veteran status. All information obtained in response to invitations to self-identify as an individual with a disability or protected veteran must be kept in a confidential data analysis file.

Applicant Flow Data (Log): A chronological compilation of applicants (including internet applicants) for employment or promotion showing each individual, categorized by race, sex and ethnic group, who applied for each job title (or group of jobs requiring similar qualifications) during a specific period.

Comparing incumbency to availability: The contractor must compare the percentage of minorities and women in each job group determined with the availability for those job groups determined. When the percentage of minorities or women employed in a particular job group is less than would reasonably be expected given their availability percentage in that particular job group, the contractor must establish a placement goal.

Determining availability: Availability is an estimate of the number of qualified minorities or women available for employment in a given job group, expressed as a percentage of all qualified persons available for employment in the job group. The purpose of the availability determination is to establish a benchmark against which the demographic composition of the contractor's incumbent workforce can be compared in order to determine whether barriers to equal employment opportunity may exist within particular job groups.

Goals for Minorities and Women, Supply and Service Contractors (Placement Goals): Placement goals that contractors must establish under Executive Order 11246 for those job groups where minorities or women, or both, are underutilized. The placement goal established must be at least equal to the availability percentage of the underutilized minorities and women for the specific job group.

Goal for Qualified Individuals with Disabilities (Utilization Goal): The regulations implementing Section 503 establish a utilization goal of 7% for the employment of qualified individuals with disabilities for each job group in the contractor’s workforce. Supply and service contractors use the same job groups that they use for the establishment of placement goals for minorities and women, and covered construction contractors apply the goal to the same trades they use when applying their participation goals under Executive Order 11246. Contractors with 100 or fewer employees have the option of using their entire workforce instead of job groups or trades.

Placement goals: Placement goals serve as objectives or targets reasonably attainable by means of applying every good faith effort to make all aspects of the entire affirmative action program work. Placement goals also are used to measure progress toward achieving equal employment opportunity.

Placement of incumbents in job groups: The contractor must separately state the percentage of minorities and the percentage of women it employs in each job group established.

Promotion: Any personnel action resulting in, for example, the movement to a position affording higher pay, greater rank, change in job title, or increase in job grade; an increase in pay, requiring greater skill or responsibility; or the opportunity to attain such. A promotion may be either competitive or noncompetitive.

Promotable or Transferable: In the context of estimating internal availability, those employees who are currently employed in a job group or groups that serve, or could serve, as a source from which selections are, or could be, made for other job groups.

Underutilization (Executive Order 11246): When the percentage of minorities or women employed in a particular job group is less than would be reasonably expected given their availability percentage in the relevant labor pool.

Protected Veteran: Any veteran who is protected by VEVRAA. To be a “protected veteran,” a veteran must meet the criteria of one or more of the following four categories: Disabled Veteran; Recently Separated Veteran; Active Duty Wartime or Campaign Badge Veteran; Armed Forces Service Medal Veteran.

Veteran: A person who served in the active military, naval or air service of the U.S., and who was discharged or released therefrom under conditions other than dishonorable.

VETS-4212 Report: Each contractor and subcontractor subject to VEVRAA is required to file the VETS-4212 report with the U.S. Department of Labor’s Veterans’ Employment and Training Service (VETS) on an annual basis. The report details the number of protected veterans the contractor employs, or has newly hired, by hiring location and EEO-1 job category.

Mandatory Job Listing (MJL): A VEVRAA affirmative action obligation that requires covered contractors to list their employment openings (with limited exceptions) with the state workforce agency job bank or with the local employment service delivery system (ESDS) where the opening occurs. Under Section 503, the prohibited basis or factor is a disability. Under VEVRAA, the prohibited basis or factor is status as a protected veteran.

VEVRAA: The Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as amended (38 U.S.C. 4212). One of the three legal authorities enforced and administered by OFCCP. VEVRAA applies to federal contractors with a contract or subcontract of $150,000 or more. However, it does not apply to federally-assisted construction contractors. VEVRAA prohibits covered federal contractors from discriminating in employment based on status as a protected veteran and requires that they take affirmative action to ensure equal employment opportunity. Federal contractors and subcontractors with 50 or more employees and a contract of $150,000 or more have additional affirmative action obligations, that include the development of a written affirmative action program.