Reference no: EM132749186

Federal contractors with contracts in excess of $50,000 and 50 or more employees are subject to Executive Order 11246 which requires Affirmative Action Plans. As part of their compliance with AA, contractors must make a good faith effort to achieve full utilization of women and minorities in job groups where underutilization exists. Utilization analysis is a comparison of (1) the percentage of minority or women employees employed by an organization in a job group and (2) the percentage of minorities and women available in the relevant labor market in those job groups. The relevant labor market is where the contractor typically recruits or selects members of the job group or labor markets from which such members could reasonably be recruited. If underutilization exists, a goal must be set to move toward full utilization.

Problem 1: Hospital B has Federal research contracts and employs 100 nursing supervisors of which 40 are minorities and 90 are women. The hospital selects approximately 80% of their nursing supervisors from among their own nurses and 20% from the external labor market. The hospital's nursing job group consists of 60% minorities and 90% women. The regional external labor market for nurses consists of 40% minorities and 90% women. Does underutilization exist? If so, where? If so, what action should the hospital take?