Employers that do business with the federal government are stressed out about the so-called new OFCCP regulations. Most employers with formalized college recruiting programs do business with the federal government, so these regulations are impacting most of our biggest clients. Some would argue that these regulations have little impact other than some additional paperwork or perhaps a slightly different candidate application process. Those people are wrong and I can prove it. First, a little background.
The OFCCP stands for The Office of Federal Contract Compliance Programs. This organization is part of the U.S. Department of Labor's Employment Standards Administration. The OFCCP administers and enforces equal employment opportunities; monitors compliance through evaluations; and investigates complaints filed by individuals alleging discrimination.
In October 2005, the OFCCP issued its infamous Internet Applicant ruling. In short, federal government contractors would be required to collect and retain records about gender, race, and ethnicity of each “Internet Applicant” for employment. The ruling became effective February 6, 2006. Because they're swell people, the OFCCP granted a whopping (note the sarcasm) 90 day grace period from this effective date for these contractors to comply with the new record keeping requirements. Keep in mind that we're talking about the largest of the largest organizations, many of which have one web site but dozens of subsidiaries and each of those subsidiaries often have completely separate recruiting teams and processes. So the OFCCP, in its infinite wisdom, gave the largest organizations in the country 90 days to completely change a critical component in their hiring process.
Under the new regulations, a person is an Internet Applicant if they meet four criteria:
- The individual submits an expression of interest in employment through the Internet.
- 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.
- The individual at no point removes themselves from further consideration or indicates that they are no longer interested in the position.
If the employer searches an external resume database, such as the resume bank of CollegeRecruiter.com, then the employer must retain all expressions of interest considered for people who meet the basic qualifications for a particular position, even if those people who are not Internet Applicants. The employers must maintain a record of the following items from external databases:
- Position for which each search was made
- Substantive search criteria used in each search
- Date of search
- Resumes of any job seekers who met the basic qualifications for the particular position who are considered by the contractor (even if they do not qualify as Internet Applicants).
Because of these onerous new regulations, many and perhaps most federal contractors have or are in the process of modifying their hiring practices so that all candidates will now need to apply on-line. No longer will candidates be permitted to apply at a career fair, through on-campus recruiting, by submitting a resume to a friend who works for the organization, or many other incredibly effective ways for organizations to attract new talent. Instead, candidates must all apply on-line. Period. End of story.
Well, not quite the end of the story because what do these employers now do about their job posting ads on sites such as CollegeRecruiter.com? The vast majority of candidates that apply to jobs which are posted on sites such as CollegeRecruiter.com do so by first reading the posting, then clicking on the apply link, then completing the application page hosted by the job board. The candidate's contact information, cover letter, and resume are then delivered behind the scenes by the job board to the employer via email. But if candidates must all apply at the web site of the employer, that process won't work. So employers are now required to force candidate who read postings on sites like CollegeRecruiter.com to apply instead at the web site of the employer. And that's where this story acquires tangible proof that these OFCCP regulations are not just adding some paperwork requirements but instead are significantly adding to the cost of hiring new talent.
For years, we have charged $125 for a standard job posting. These run under one city and state for 60 days. We're not at the low or high end of the pricing scale. That's pretty typical for a premium niche career site. About a year ago, we added a $50 fee per posting for employers who wanted to require candidates to apply at their site. These employers were usually doing so because they had purchased applicant tracking systems that were unable to accept resumes via email. The ATS companies were essentially saying to employers that the ATS software is a square hole and the employers are round pegs and even though it is usually the vendor that bends over backwards to accommodate the best interests of their client, the ATS companies often told their clients that the clients had to change their hiring practices in order to accommodate the rigid coding of the ATS software. The effect on these employers was that their posting prices went from $125 to $175 because of the inflexibility of their ATS software.
Fast forward to the summer of 2006. The OFCCP regulations push many employers into only accepting applications through their web sites. Those employers then come to CollegeRecruiter.com and say that they want to buy a job posting package but the candidates must apply at the web sites of the employer. Cost: $125 for the posting plus $50 for the apply URL. Not very friendly to be nickel-and-diming an increasingly large percentage of our clients, but we do it. I don't like it, but we do it.
When it became apparent that the $125 plus $50 cost was the reality for an increasingly large number of our biggest clients, we decided that it was becoming increasingly client unfriendly to communicate that the cost of a posting was $125 when it really was $175 for many of our clients so we are increasing the cost of postings on September first from $125 to $175. No more nickel-and-diming and we'll make a bit more money on the employers who are not requiring candidates to apply through the web sites of the employers, but it is or soon will be revenue neutral for the vast majority of our biggest clients.
So what is the cost of the new OFCCP regulation? Well, astronomical. Think of the number of job boards that have or will adopt new, higher pricing structures such as ours. Think of the number of employers that will be forced to pay those new, higher prices. And think of the number of jobs posted by those employers at those new higher prices. If anyone from OFCCP tries to tell you that the costs of the new regulations are minimal, tell them to call me. I'd love to spend a few minutes with them.
Heather Eagar, a former professional resume writer who started her online career in 2003, currently helps thousands of job seekers with their quest for a new and better job. She has created many career-driven and job seeker focused sites. Each one serves a different - yet important - market.
After a successful management career in the corporate world with California and New York based companies, Frank entered the executive search and staffing industry in 1987. He became the most productive Search Consultant at two consecutive regional staffing firms while helping companies locate the difficult talent they were in dire need of hiring in order to grow.
