OFFCP Sets New Number-Based Hiring and Employment Requirements

Calling it “a historic advance for veterans and individuals with disabilities,” the Department of Labor, through the Office of Federal Contract Compliance Programs (OFCCP), announced two new regulations on August 27, 2013 setting new numeric targets that federal contractors will have to satisfy with respect to hiring veterans and individuals with disabilities. These regulations establish metrics to measure the progress of employers that are federal contractors “toward achieving equal opportunity for people with disabilities and protected veterans.”

Pursuant to these new regulations, federal contractors will be required to establish an annual goal of hiring veterans at a rate similar to the national percentage of veterans in the workforce (currently at 8%). Additionally, the regulations will require employers to set a goal of having at least 7% of the total workforce be made up of individuals with disabilities in every job category within a company. In releasing the regulations, the OFFCP stated that it anticipates the regulations being published in the Federal Register within the next two weeks. The regulations would then take effect 180 days after that publication, or in approximately early spring 2014. However, the Affirmative Action Plans of employers do not need to address these changes until after the regulations become effective such that, for employers that prepare such plans on a calendar year basis, 2015 will be the first year that their plans need to address the new requirements.

The Department of Labor’s decision to implement these new regulations comes despite some publicly expressed concern by federal contractors that the new metrics will do little to increase the actual hiring of veterans or individuals with disabilities but will nevertheless impose extensive recordkeeping and data collection burdens. Such contractors also expressed particular concern with the disability metric because the Americans with Disabilities Act prohibits employers from making pre-employment disability-related inquiries (although a recent legal opinion from the Equal Employment Opportunity Commission claims that employers may make such inquiries if they do so to comply with other federal laws).

Whether they agree with the wisdom of the new regulations or not, employers that are federal contractors will soon have a new set of compliance obligations to satisfy. We strongly recommend working with legal counsel to establish protocols to show compliance next year with the OFFCP’s latest requirements.

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