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OFCCP Final Rules Require Federal Contractors to Revisit Hiring Procedures

Submitted by Firm:
Cross, Gunter, Witherspoon & Galchus, P.C.
Firm Contacts:
Abtin Mehdizadegan, J. Bruce Cross, Misty Wilson Borkowski
Article Type:
Legal Update
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OFCCP Announces Final Rules Under the Vietnam Era Veterans' Readjustment Act and Under Section 503 of the Rehabilitation Act that Require Federal Contractors to Revisit Hiring Procedures

On August 27, 2013, the U.S. Department of Labor Office of Federal Contract Compliance Programs (OFCCP) announced two final rules that change contractor duties under both the Vietnam Era Veterans' Readjustment Assistance Act of 1974 (VEVRAA) and Section 503 of the Rehabilitation Act of 1973.

The VEVRAA Final Rule changed several requirements for government contractors with respect to hiring procedures and data collection. Specifically, the following is a summary of the impact of the Final Rule under the VEVRAA for federal contractors and subcontractors.

  • Hiring Benchmarks: The Final Rule requires that contractors establish annual hiring benchmarks for protected veterans. Contractors must use one of two methods to establish their benchmarks. First, contractors may choose to establish a benchmark equal to the national percentage of veterans in the civilian labor force, which is currently eight percent. In the alternative, contractors may establish their own benchmarks using certain data from the Bureau of Labor Statistics and Veterans' Employment and Training Service/Employment and Training Administration, as well as other factors that reflect the contractor's unique hiring circumstances.
  • Data collection: Contractors must now document, update annually, and retain for three years several quantitative comparisons for the number of veterans who apply for jobs and the number of veterans they hire.
  • Self-Identification: Contractors must invite applicants to self-identify as protected veterans at both the pre-offer and post-offer phases of the application process. The Final Rule provides sample language for contractors to use.
  • Incorporation of the Equal Opportunity Clause: The Final Rule requires that specific language be used when incorporating the equal opportunity clause into a subcontract by reference.
  • Job Listings: When listing job openings, contractors must provide such information in a manner and format permitted by the appropriate State or local job service, so that it can access and use the information to make the job listings available to job seekers.
  • Record Access: Contractors must allow OFCCP to review documents related to a compliance check or focused review, either on-site or off-site, at OFCCP's option. In addition, the Final Rule requires contractors, upon request, to inform OFCCP of all formats in which it maintains its records and provide them to OFCCP in whichever of those formats OFCCP requests.  

The Rehabilitation Act Final Rule has drastically changed Section 503 of the Act by establishing a new, seven percent aspirational goal for hiring qualified individuals with disabilities. Contractors must now conduct an annual utilization analysis and assessment, and establish specific action-oriented programs to address areas requiring mitigation. Likewise, contractors must now follow the same procedures outlined under the VEVRAA Final Rule regarding data collection, self-identification, incorporation of an equal opportunity clause, and records access by the OFCCP.

If you are a federal contractor, these changes require your immediate attention with respect to altering your hiring and record-retention procedures as both Final Rules will become effective within 180 days of publication in the Federal Register.