- Change Will Affect Whether Affirmative Action Obligations Apply to Financial Institutions
- August 12, 2011 | Author: Eric John Felsberg
- Law Firm: Jackson Lewis LLP - Melville Office
The U.S. Treasury Department’s Bureau of the Public Debt has announced that, beginning January 1, 2012, financial institutions, such as banks and credit unions, will no longer sell U.S. Savings Bonds. The bonds will be sold solely through the Treasury Department’s website, http://treasurydirect.gov. Thus, financial institutions should evaluate whether they will continue to have federal affirmative action obligations.
Who Must Maintain Affirmative Action Plan
Under Executive Order 11246 and its implementing regulations, financial institutions may become subject to federal affirmative action requirements in several ways. Financial institutions must maintain written affirmative action plans if they have at least 50 employees and meet one of the following criteria:
The institution is issuing and paying agents for U.S. Savings Bonds and Notes in any amount; or
The institution serves as a depository of Government funds in any amount; or
The institution holds a prime or subcontract with the federal government of at least $50,000.
The Office of Federal Contract Compliance Programs (OFCCP) takes the position that financial institutions that participate in Federal Deposit Insurance Corporation (FDIC) or National Credit Union Association (NCUA) programs are subject to the Agency’s jurisdiction. Accordingly, financial institutions may continue to be subject to the federal requirements despite the Treasury Department’s announcement.
Financial institutions should review whether they must continue to prepare written affirmative action plans. Financial institutions that will serve as a depository of Government funds in any amounts, participate in FDIC or NCUA programs, or hold a federal contract or subcontract of at least $50,000 should continue to prepare affirmative action plans even after January 1, 2012.