Individuals with disabilities changes for Federal Contractors/Subcontractors

VeteranArguably, one of the most important Federal regulatory changes in 2013 was the OFCCP’s final release of regulations updating Section 421 of the Vietnam Era Veterans’ Readjustment Assistance Act of 1973 (VEVRAA) and Section 503 of the Rehabilitation Act of 1974 in the Federal Register. These regulations prohibit federal contractors and subcontractors from discriminating against protected veterans/individuals with disabilities (IWDs) in employment contexts and require employers to take affirmative action to recruit, hire, promote, and retain veterans/IWDs. The final rules were designed to strengthen the affirmative action provisions of the regulations and to aid contractors in their efforts to recruit and hire protected veterans/IWDs and to improve job opportunities for these individuals.

Each of the final rules imposes new obligations on federal contractors regarding veterans and individuals with disabilities (IWDs). The updated regulations expand contractors’ affirmative action and non-discriminatory obligations and impose new record keeping, posting, and notice requirements designed to allow the OFCCP to evaluate compliance. Highlights of the final rules include:

  • Requiring contractors to establish annual 8% hiring benchmarks for veterans at each affirmative action location. Contractors can choose to use a benchmark that is equal to the national percentage of veterans in the civilian labor force. Alternatively, they can establish their own benchmark using data from the Bureau of Labor Statistics (BLS) and Veterans’ Employment and Training Service/Employment and Training Administration (VETS/ETA) and other factors that reflect the contractor’s unique hiring circumstances.
  • Establishing a nationwide 7% utilization goal for qualified IWD representation in each job group (or for the entire workforce if there are 100 or fewer employees) at each affirmative action plan location. Annual utilization analyses must be conducted to identify problem areas and programs established to strive to address those problem areas.
  • Requiring contractors to collect and maintain data as well as prepare metrics regarding the number of veterans/IWDs who apply for jobs and the number of veterans/IWDs they hire (including external hires, internal promotions, and transfers).
  • Requiring contractors to invite applicants to self-identify as protected veterans/IWDs at both pre- and post-offer phases of the application processes. Note that the American’s with Disabilities Act (ADA) prohibits the collection of this information. However, the OFCCP has stated that after the effective date of the regulation, contractors are not at risk for collecting the information as the new regulation supersedes the ADA.
  • Requiring contractors to allow OFCCP to review documents related to compliance checks or focused review.

Each of these regulations has been approved by the Office of Management and Budget (OMB) and each goes into effect in March 2014. However, contractors with a written affirmative action program (AAP) already in place on the effective date have additional time to come into compliance with the AAP requirements. It will be interesting to evaluate the impact of these new regulations on veteran/IWDs employment over time and the burdens placed on contractors and subcontractors.

Reprinted with permission from the Personnel Testing Council of Metropolitan Washington.

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