OMB Control No. 3235-0725 Supporting Statement

SUPPORTING STATEMENT
FOR THE PAPERWORK REDUCTION ACT
INFORMATION COLLECTION SUBMISSION
“Contract Standard for Contractor Workforce Inclusion”
OMB Control No. 3235-0725
A.

JUSTIFICATION
1.

Legal and Administrative Requirements
Section 342(a)(1)(A) of the Dodd-Frank Wall Street Reform and Consumer
Protection Act (the Dodd-Frank Act) provides for certain agencies, including the
Securities and Exchange Commission (the Commission), to establish an Office of
Minority and Women Inclusion (OMWI). 1 Section 342(c)(2) of the Dodd-Frank
Act requires that the OMWI Director include in the procedures for evaluating
contract proposals and hiring service providers a component that gives
consideration to the diversity of an applicant, to the extent consistent with
applicable laws. In addition, section 342(c)(2) requires that the contracting
procedures include a written statement, in the form and content prescribed by the
OMWI Director, that a contractor shall ensure, to the maximum extent possible,
the fair inclusion of women and minorities in the workforce of the contractor and,
as applicable, subcontractors.
Section 342(c)(3)(A) of the Dodd-Frank Act further requires the OMWI Director
to establish standards and procedures for determining whether an agency
contractor or subcontractor “has failed to make a good faith effort to include
minorities and women” in its workforce. If the OMWI Director determines that a
contractor has failed to make good faith efforts, section 342(c)(3)(B)(i) provides
that the Director shall recommend to the agency administrator that the contract be
terminated. Upon receipt of such a recommendation, section 342(c)(3)(B)(ii)
provides that the agency administrator may terminate the contract, make a referral
to the Office of Federal Contract Compliance Programs of the Department of
Labor, or take other appropriate action.
To implement the acquisition-specific requirements of section 342(c) of the
Dodd-Frank Act, the Commission adopted a Contract Standard for Contractor
Workforce Inclusion (Contract Standard). The Contract Standard is included in
the Commission’s solicitations and resulting contracts for services valued at
$100,000 or more. The Contract Standard requires the contractor to include the
substance of the Contract Standard in all subcontracts for services with a dollar
value of $100,000 or more awarded under the contract. Accordingly, the
requirements of the Contract Standard apply to covered subcontractors, as
prescribed in section 342(c)(2) of the Dodd-Frank Act.

1

12 U.S.C. 5452.

The Contract Standard requires a contractor with 50 or more employees to
provide specified documentation, upon the request of the Commission’s OMWI
Director, to demonstrate that it has made good faith efforts to ensure the fair
inclusion of minorities and women in its workforce and, as applicable, to
demonstrate that its covered subcontractors have made such good faith efforts.
The request for specified documentation pursuant to the Contract Standard
amounts to a “collection of information” within the meaning of the Paperwork
Reduction Act of 1995 (PRA). 2
2.

Purpose and Use of the Information Collected
The purpose of the collection of information is to satisfy the requirements of
section 342(c)(3)(B) of the Dodd-Frank Act. The collection of information allows
the Commission’s OMWI Director to determine whether the contractor has
complied with its obligations under the Contract Standard to make good faith
efforts to ensure the fair inclusion of minorities in its workforce, and as
applicable, to determine whether the contractor’s covered subcontractors have
similarly complied with their obligations to make such good faith efforts.

3.

Consideration Given to Information Technology
A respondent may use any available automated, electronic, mechanical, or other
technological collection technique to submit the requested information to the
SEC.

4.

Duplication of Information
The collection of information avoids duplication by allowing respondents to fulfill
the reporting requirement, where possible, by submitting information that already
is available to, or compiled by, respondents for other purposes.

5.

Reducing the Burden on Small Entities
To minimize the impact on smaller entities, only contractors with 50 or more
employees will be required to demonstrate that it has made good faith efforts to
ensure the fair inclusion of minorities and women in its workforce, and as
applicable, its subcontractors.

6.

Consequences of Not Conducting Collection
Without the implementation and use of the collection of information, the
Commission would not be able to satisfy the requirement of section 342(c)(3)(B)
of the Dodd-Frank Act that the OMWI Director determine whether the agency
contractors have failed to make good faith efforts to ensure the fair inclusion of
minorities and women in their workforces.

2

44 U.S.C. 3501 et seq.

7.

Inconsistencies with Guidelines in 5 CFR 1320.5(d)(2)
The Contract Standard calls for contractors to provide the specified
documentation to demonstrate its good faith efforts to comply with the provisions
of the Contract Standard within ten (10) business days of a written request from
the Commission’s OMWI Director or designee, or such longer time as the OMWI
Director or designee determines. The specified documentation should be readily
available when the request is received from the OMWI Director. As explained in
Item 12 of this Supporting Statement, we estimate that it will take all contractors
on average approximately one hour to retrieve and submit the documentation
specified in the Contract Standard. Although shorter than the 30-day guideline in
5 CFR 1320.5(d)(2)(ii), we believe that the ten days provided under the Contract
Standard is a reasonable amount of time to respond a request from the OMWI
Director to submit the specified documentation.
Section 342(c) and the Contract Standard require contractors to engage in good
faith efforts at all times during the term of a contract and not merely in the 30
days preceding the OMWI Director’s review. Because each covered contractor
should have a workforce inclusion plan in place at all times during the term of the
contract, 10 days should normally be sufficient time to submit a copy of the plan
to the OMWI Director. The other data that may be required to be submitted under
the Contract Standard are factual in nature, and it is reasonable for contractors to
be prepared to provide them. Moreover, the Contractor Standard requires that
information be provided within 10 business days of a written request or such
longer time as the OMWI Director or designee determines. In addition, because
most respondents may fulfill the reporting requirement by submitting information
that has already been prepared for other purposes, the specified documentation
should in most cases be readily available when the request is received. As
explained in Item 12 of this Supporting Statement, we estimate that it will take
contractors on average approximately one hour to retrieve and submit the
documentation specified in the Contract Standard.

8.

Consultations Outside the Agency
The Commission published a notice in the Federal Register (89 FR 57451)
soliciting comments on its intention to request an extension of this currently
approved information collection and allowed the public 60 days to submit
comments. The Commission received no comments.

9.

Payment of Gift to Respondents
Not applicable.

10.

Assurance of Confidentiality
The Commission makes no express assurance of confidentiality in relation to this
information collection. However, contractors submitting information in response
to a request from the OMWI Director that is considered sensitive and confidential
are advised to follow the procedures under the Commission’s regulations
implementing the Freedom of Information Act (FOIA) for designating
information as confidential business information or seeking confidential
treatment. 3

11.

Sensitive Questions
Not applicable.

12.

Estimate of Information Collection Burden
The following estimates of average burden hours and costs are made solely for the
purposes of the Paperwork Reduction Act of 1995 4 and are not derived from a
comprehensive or even representative survey or study of the cost.
The collection of information imposes no new recordkeeping burdens as eligible
contractors will provide information already required under Title VII of the Civil
Rights Act 5 and Executive Order 11246. 6
The Commission estimates it will take respondents approximately 1 hour to
retrieve and submit the documentation specified in the Contract Standard. 7

3

17 CFR 200.83.

4

44 U.S.C. 3501 et seq.

5

42 U.S.C. 2000e et seq.

Similar to the information required under Executive Order 11246 and implementing regulations, the documentation
requested to demonstrate good faith efforts to ensure the fair inclusion of minorities in the contractor’s workforce
may include, but is not limited to: 1) the total number of employees in the contractor’s workforce, and the number of
employees by race, ethnicity, gender, and job title or EEO-1 job category (e.g., EEO-1 Report(s)); 2) a list of
covered subcontract awards under the contract that includes the dollar amount of each subcontract, date of award,
and the subcontractor’s race, ethnicity, and/or gender ownership status; 3) the contractor’s plan to ensure the fair
inclusion of minorities and women in its workforce, including outreach efforts; and 4) for each covered
subcontractor, the information requested in items 1 and 3 above.
6

In some instances, the respondent may be required to request eligible subcontractors to provide the required
documentation specified in the Contract Standard. Eligible subcontractors are obligated to keep workforce
demographic data and maintain workforce inclusion plans because the substance of the Contract Standard is

7

Documentation will be requested from approximately 50 contractors each year,
and therefore, the estimated total annual reporting burden is 50 hours.
13.

Estimate of Total Annualized Cost Burden
The estimated aggregate burden hours and monetary equivalent for the
information collection are summarized in the table below.

14.

Paperwork
Activity

Number of
Respondents

Burden Hours
Per
Respondent

Retrieving and
Submitting
Documentation
of Good Faith
Efforts to
OMWI
Director

50

1

Annual
Burden
Hours

50

Cost of Burden
Hours Per
8
Respondent

Annualized
Burden Hour
Monetary
Equivalent

$45

$2,250

Estimate of Cost to Federal Government
The estimated annual cost to the government for this collection of information is
approximately $44,100. This amount reflects an estimate of the amount of time
staff that would be needed to review and analyze documentation submitted by an
estimated 50 contractors each year pursuant to the Contract Standard. 9

15.

Explanation of Changes in Burden
The change in the estimated annual burden hours from 925 to 50 is due to a
change in eligibility criteria for requesting documentation to only those
contractors with 50 or more employees. This change in eligibility criteria
eliminated any new recordkeeping burden since contractors with 50 or more
employees are generally subject to the recordkeeping and reporting requirements

included in their subcontracts. However, based on recent Commission subcontractor activity data, we believe that
very few subcontractors will have subcontracts with a dollar value of $100,000 or more under Commission service
contracts. Moreover, these subcontractors may already be subject to similar recordkeeping requirements as principal
contractors. Consequently, any additional requirements imposed on subcontractors should not significantly add to
the burden estimates.
8

The estimated annualized cost to contractors associated with the recordkeeping and reporting burden resulting
from this collection of information is based on Bureau of Labor Statistics data in the publication “Employer Costs
for Employee Compensation” (March 2024), which lists total compensation for management, professional, and
related occupations as $73 per hour and administrative support as $35 per hour. We estimate that 25 percent of the
burden hours for retrieving and submitting documentation to the OMWI Director would be professional,
management, and related occupations and 75 percent would be administrative support.
9

We estimate that it would take OMWI staff approximately six hours to review documentation submitted by each
contractor. Thus, we estimate that it will take approximately 300 total hours each year to review and analyze the
documentation submitted by contractors at an average OMWI rate of $147 per hour.

under the regulations implementing Title VII of the Civil Rights Act and
Executive Order 11246.
16.

Information Collections Planned for Statistical Purposes
Not applicable.

17.

Display of OMB Expiration Date
Not applicable.

18.

Exceptions to Certification
The SEC certifies that this collection of information is consistent with the
requirements of 5 C.F.R. 1320.9 and the related provisions of 5
C.F.R. 1320.8(b)(3), and the SEC is not seeking an exemption to these
certification requirements.

B.

COLLECTION OF INFORMATION EMPLOYMENT STATISTICAL
METHODS
Not applicable. This collection of information does not involve the use of statistical
methods.