Upcoming Changes for Federal Contractors


In September 2013, the Office of Federal Contract Compliance Programs (OFCCP) implemented its regulation increasing the affirmative action requirements regarding individuals with disabilities for those federal contractors and subcontractors who are required to maintain an affirmative action plan.

The new regulation, effective March 24, 2014, mandates that federal contractors adopt a utilization goal of seven-percent for employing individuals with disabilities. To reach this goal, the regulation also requires contractors to provide applicants an opportunity to self-identify as disabled, during both the pre-offer and post-offer stage of hiring. In addition to new hires, federal contractors must also invite current employees to self-identify during the first applicable year of the regulation, and every five years subsequently. Lastly, contractors should annually remind employees of their ability to voluntarily update their disability status during intervening years. Contractors may only invite applicants or employees to self-identify - they cannot compel or force individuals to do so.

To track the seven-percent utilization goal, the regulation requires contractors to collect data, including, among others: the amount of applicants electing to self-identify; the amount of job openings; the amount of jobs filled; the number of applicants for jobs; and the number of applicants hired.

In January 2014, the Office of Management and Budget (OMB) approved the new self-identification form that federal contractors and subcontractors must use to collect information on disability from both applicants and current employees. To review a copy of the form, click here to visit the Office of Information and Regulatory Affairs website.

Although the regulation becomes effective on March 24, 2014, contractors with an affirmative action plan in place as of March 24, 2014, may wait until the end of the plan cycle to comply with the changes.

With the new form now available and the March 24, 2014 effective date approaching, contractors should review the new regulation and, if necessary, update their information systems to comply with the new regulation. In particular, contractors need to develop an effective way in which to implement the new form into their hiring process, including updating the self-identification process and data collection systems, updating or implementing an efficient way in which to record required data, and ensuring that human resources personnel receive appropriate training on the new procedures and policies.

Additionally, during the State of the Union Address on January 28, 2014, President Obama outlined his intention to sign an executive order increasing the minimum wage of workers employed through new federal contracts to $10.10 an hour. Information regarding the precise details and scope of the executive order, including exactly what workers it will affect and when, has not been released. Keep an eye out for further updates.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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