ALERT: Major changes announced for vets and disabilities rules for federal contractors

Employers with federal contracts will have significant new obligations in affirmative action compliance for veterans and people with disabilities, under new regulations announced by the Office of Federal Contract Compliance Programs (OFCCP). The final rules will likely take effect in late February or early March 2014 (180 days after they’re published in the Federal Register, which should be any day now). Employers who already have written affirmative action plans (AAPs) in place on the effective date may wait until their next 12-month plan date to implement the new AAP format, but will still have to comply with other portions of the rule by the effective date. The regulations implement the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) and Section 503 of the Rehabilitation Act. Here are the highlights of the final rules:

• Pre-offer invitation to self-identify: Contrary to decades of enforcement under the Americans with Disabilities Act (ADA), federal contractors will be required to ask applicants to voluntarily self-identify their status as a person with a disability (and also as a protected veteran), before the job-offer stage. To assuage employers’ concerns, the OFCCP obtained a letter from the Equal Employment Opportunity Commission (EEOC)’s Office of Legal Counsel, stating that federal contractors won’t violate the ADA by complying with the OFCCP’s new rule. The invitation may be made at the same time as the current pre-offer invitation for race/ethnicity and gender.
   
• Post-offer invitation to self-identify: The post-offer invitation to self-identify asks for more details than the pre-offer invitation, by asking protected veterans to specify which of the four veteran categories apply to them. It also continues to include questions about race/ethnicity, gender, and disability. Every five years after becoming subject to the new rules, employers must re-survey their workforce to ask individuals to self-identify their disability status. At least once in between those five-year gaps, employers must remind employees that they may self-identify as a person with a disability at any time. If someone fails to complete the self-identification form, but has an obvious disability (such as blindness), or has already disclosed their disability, then the company may take the initiative and record the individual as having a disability.
   
• Annual hiring benchmarks for veterans: For the first time, federal contractors will be required to establish a facility-wide hiring benchmark for hiring veterans. They may either use the OFCCP’s suggested benchmark of eight percent, or else come up with their own benchmarks using certain federal data as well as consideration of their own unique circumstances. The OFCCP will periodically reevaluate its suggested benchmark based on available statistics.
   
• Annual utilization goal for people with disabilities: This is another first. Contractors must apply a utilization goal for employing people with disabilities. The nationwide goal is seven percent and must be applied to each job group, although companies with 100 or fewer employees may apply the goal to their workforce as a whole. The OFCCP will periodically reevaluate this numerical goal based on available statistics.
   
• Data collection: All of that self-identification data is being collected for a reason. Contractors will have to track the effectiveness of their recruitment and hiring processes, by examining their facility-wide hiring rates for protected veterans and people with disabilities. This data must be kept for three years (instead of the usual one or two-year record-keeping obligation), and as the years go by, employers will have to examine the data not only from the current year, but also from the two prior years.
   
• Job ads: In job advertisements, federal contractors will have to include new language stating that all qualified applicants will be considered regardless of their status as a protected veteran or a person with a disability. For employers who have been using the simplified “Equal Opportunity Employer” language permitted by the regulations under Executive Order 11246 (regarding affirmative action based on race/ethnicity and gender), this change will mean higher costs for per-word job postings. Under the current Executive Order 11246 rules, employers who don’t say “Equal Opportunity Employer” in their job ads generally must be more specific by stating that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, or national origin. OFCCP says adding “protected veteran” and “disability” to that list shouldn’t be a big deal.
   
• Posting with the state employment service delivery system: When posting external job openings with the state employment office as required under the veterans rules, an employer must follow that office’s formatting requirements. The employer must also notify the state employment office that it is a federal contractor, provide contact information for the official responsible for hiring at that location, and update the information as needed. If the employer uses an outside organization to assist in hiring, such as a temporary employment agency, then that contact information must also be shared with the state.
   
• Electronic posters: If the company uses an electronic application process, the OFCCP wants to be sure applicants understand their rights. Federal contractors are already required to display certain employment posters where applicants as well as employees can see them. To address this requirement for electronic application systems, the OFCCP will require those same posters to be displayed electronically where applicants can see them. For employees who work in remote locations, the company may email the posters or post them on the company’s intranet, as long as it’s certain that the employees can access them.
   
• Equal opportunity clause in subcontracts and purchase orders: Employers who want to keep their subcontracts and purchase orders to a manageable length by incorporating the equal opportunity clauses by reference may do so, but now there is specific mandatory language (two full sentences each for veterans and for people with disabilities), which must be included in bold text. Just be grateful the agency backed away from its initial proposal to require contractors to include the full text of these clauses (12 paragraphs for the veterans regulations and 7 paragraphs for the disabilities regulations).
   
• Policy notice to subcontractors: As part of its obligation to externally share its affirmative action policy, each federal contractor will have to notify all of its subcontractors, including vendors and suppliers, of its policy, requesting appropriate action on their part. The OFCCP says employers may accomplish this by sending a copy of the affirmative action policy statement that is already posted on company bulletin boards for workers. For example language, see Vigilant’s Model Policy, “Equal Employment Opportunity Policy” (1603).
   
• Allowing workers to see the AAP: The new rules continue to require federal contractors to allow applicants and employees, upon request, to see the AAPs for protected veterans and people with disabilities, but fortunately employers will be permitted to exclude the newly required numerical data, because it raises confidentiality concerns.
   
• Temporal scope of affirmative action audits: The agency stood fast on its proposed clarification that it has the right to request data on personnel actions that occur after the date an employer receives an audit scheduling letter. Normally the agency just requests data on activities for the past one or two years. This means that a really sticky audit could continue on and on without an end in sight, as new personnel actions occur and the agency investigates those actions. In practice, this would be an unusual occurrence, since the OFCCP has limited resources and wants to audit as many employers as possible.
   
• A little good news: The agency backed off of some of its original proposals, including a requirement for employers to sign “linkage agreements” with at least six outreach organizations (three for veterans and three for people with disabilities). Another proposal that was dropped was a requirement to track how many veterans and people with disabilities were referred by specific organizations.
   
• Removal of old veterans categories: The “old” veterans regulations which applied to employers with federal contracts worth at least $25,000 that were signed before December 1, 2003, and never modified since then, will be deleted because as far as OFCCP knows, there aren’t any such contracts still hanging around. But to be on the safe side, the OFCCP says if there are any employers holding those old contracts, then the veterans who were protected under those old rules are still protected from discrimination (special disabled veterans, veterans of the Vietnam-era, veterans released from active duty within the past year, and veterans who served on active duty during a war or campaign or expedition for which a campaign badge was authorized).
   
• Tips: Vigilant will be holding a complimentary webinar on Thursday, September 12, 2013, explaining the new rules. We encourage you to register now. For more information, see the OFCCP’s web pages devoted to the new rules for veterans as well as for people with disabilities.  They provide a press release, FAQs, and the text of the regulations, as well as registration links for free webinars presented by OFCCP.
  
  We will be reviewing and updating our model documents and affirmative action plan language in light of the new rules, and will provide more detailed guidance in future Vigilant newsletter articles. If you use Vigilant to prepare your affirmative action plans, we will also be checking in as the compliance date nears, to ensure that you understand what needs to be done under the new rules. Questions? Contact your Vigilant affirmative action representative or Karen Davis (800-733-8621 or k.davis@vigilantcounsel.org).