Frito-Lay sues the OFCCP in the federal district court of Texas due to a recent Administrative Review Board’s (ARB) ruling against them. The Office of Federal Contract Compliance Programs (OFCCP) and Frito-Lay Inc. have been involved in litigation regarding the OFCCP’s ability to acquire personnel activity data of the scheduling letter during an OFCCP affirmative action plan audit. On May eight Frito-Lay Inc was successful before the Administrative Law Judge. However, the decision was later reversed by the Administrative Review Board (ARB). Following the decision Frito-Lay Inc. filed suit On June 5, 2012, against OFCCP in federal district court in light of the ARB ruling.
The situation began with a Frito-Lay Inc receiving an affirmative action audit scheduling letter on July 13, 2007. During the OFCCP desk audit stage Frito-Lay supplied employees’ activity information for the period of July 13, 2005 through December 31, 2007. Later on the OFCCP demanded employees’ activity information for the period of January 1, 2008 through October 31, 2009. Frito-Lay, Inc. refused, and OFCCP filed an administrative complaint. On July 23, 2010, the ALJ ruled in favor of Frito-Lay, clarifying the OFCCP guidelines to allow the OFCCP to review business information as per the dates listed in the scheduling letter. The ARB reversed the ALJ decision proclaiming that the OFCCP’s demand for 2008-2009 employees activity information was “reasonable and consistent” with the Executive Order 11246 regulations.
The ARB was focused on the OFCCP’s discovery of alleged extensive imbalance in hiring as to women, which would give the OFCCP access to records immediately after the date of the scheduling letter. The ARB ruling will not impact the requests for records beyond the scheduling letter for all audits. Alternatively, the OFCCP’s demand for data past the scheduling letter is narrowed to those times in which the department finds inadequacies. For Frito-Lay, the ARB contends that the OFCCP’s discovery of imbalance as to the hiring of women was a deficiency which warranted the agency’s demand for added data.
Frito-Lay Inc. has appealed the ARB decision reasoning that it was “arbitrary and impulsive, an abuse of discretion and not in accordance with law, contrary to constitutional right, and with no observance of process necessitated by law, and not supported by significant proof.” Frito-Lay is requesting the court to follow the findings of the ALJ in particular the regulations and Federal Contract Compliance Manual (FCCM) segments, which declare that the OFCCP may analyze employees’ activity information for “the normal liability period” that is the “full two years prior to the date the federal contractor was given the scheduling letter.” Some OFCCP officials are demanding employees’ activity information after the date of the scheduling letter despite having the ALJ ruling. With the ARB decision, federal contractors can anticipate more such OFCCP demands.
This will be an important case to follow as OFCCP continues to exceed their reach in matters of Federal Contractors that have affirmative action requirements under Executive Order 11246 the CFR’s requiring the creation of an affirmative action planned recordkeeping.
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Founded in 1979, Career Resources is a privately owned company which develops Affirmative Action and Diversity Plans, provides Diversity and Affirmative Action Plan implementation, online e-Learning courses, Sexual Harassment Training, EEOC and OFCCP vulnerability audits, OFCCP audit support used by hundreds of organizations nationwide including fortune 500 companies and small/medium size businesses in all industries.