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OFCCP’S Groundbreaking New Section 503 and VEVRAA Regulations

OutSolve, LLC Annual Client SeminarJune 2014

Presented by:Celia M. Joseph

Phone: (610) 230-2144Email: [email protected]


"Strengthening these regulations is an important step toward reducing barriers to real opportunities for veterans and individuals with disabilities."

Patricia A. Shiu, OFCCP Director

September 2013


OFCCP Overview

• OFCCP requires compliance for covered contractors; - Executive Order 11246 - Section 503 of the

Rehabilitation Act of 1973 (Section 503)

- Vietnam War-Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA)

• 25% of U.S. workers are employed by Federal contractors


Final Rules: VEVRAA and Section 503

• Historic first revisions to these two regulations in 40 years

• Published September 24, 2013• Effective date: March 24, 2014• Different effective date for Affirmative Action Plan

requirements (Subpart C)• Transition example for AAP with March 1, 2014 date

– March 1, 2015: Compliance with Subpart C– March 1, 2016: AAP fully reflects results of all new

regulatory requirements


VEVRAA: Rationale for Revision

• Applies to contractors with 50 employees and $100k contract

• First major revision since 1976

• Fewer “Vietnam Veterans”• Veterans’ unemployment

rates higher than average• Protect Gulf War-Era II vets• NPRM comments affected

final rule


VEVRAA: “Protected Veteran” Categories• “Protected Veteran” definition

added– Disabled veterans– Recently separated veterans (3

years)– Recipients of Armed Forces service

medal– “Active duty wartime or campaign

badge veteran” replaced “other protected veteran”

– “Pre-JVA veteran” added


VEVRAA: Job Postings, Solicitations, Contracts and Notices

• Equal Opportunity (EO) Clause required– Equal employment opportunity

employer of protected veterans; may be combined with 503 and EO

– Add mandatory EO clause to contracts

– Accessible notice of rights and application process and employees

– Notify union

• Employment Service Delivery System (ESDS) – provide in usable format


VEVRAA: Job Postings, Solicitations, Contracts and Notices

• “EEO is the Law” poster will be revised; not required to be stored with each application (ex: link to poster with application)

• Electronic format– Reasonable accommodation

(accessible and understandable, Braille, large print only when requested or disability known)

– Current employees who work virtually; actual knowledge of accessibility

• Allowable abbreviations (vets, not v)


On-Line Application Process: Accessibility

• Focus of OFCCP compliance officers

• Contractor’s website use with technology for inter-operation

• Prominence of contractor’s accessibility statements

• Contractor’s contact information

• Retain records of accommodation requests


VEVRAA: New Self-Identification Rules

• OFCCP sample form • Pre-offer (new): rationale

– Ask applicants to identify as protected veteran in general

– Disabled veteran not specifically identified

– Application materials• Post-offer

– Specific categories• Use data to assess outreach and

recruitment• Data analysis file confidentiality


VEVRAA: New Data Collection Analysis Requirements

• Meaningful data to evaluate and tailor outreach; flexibility; records retention

• Steps where efforts not effective• Five factors required:

1. Number of protected veteran applicants

2. Number of job openings and jobs filled

3. Number of all applicants

4. Number of protected vets hired

5. Number of applicants hired


VEVRAA: New Data Collection Analysis Requirements (Clarification)

• Job opening: – number of individual positions advertised as open in

announcement or requisition– Ex: 5 open positions with 4 filled; contractor would document as 5

job openings and 4 jobs filled

• Jobs filled: – all jobs the company filled by any means (competitive or

noncompetitive), including reassignment or merit promotion)– Both new hires and employees placed in new positions via

promotions, transfers, reassignments

• Hired: Solely refers to applicants (both internal and external) hired through competitive process, including promotions


VEVRAA: What are Benchmarks?

• Established by each contractor required to prepare AAP; applied to hiring for each establishment

• A tool and “yardstick”; not a goal, not a quota

• Data availability issues• Measurement of effectiveness

of outreach efforts• No violation or penalty for

failure to meet benchmark


VEVRAA: Establishing Benchmarks

• National benchmark (currently 7.2%) OR

• Five-Factor Option (Contractor may customize its

analysis and provide reasons; explain factors, but no

need to assign numerical values)

1. Consider state statistics

2. Number of vets in prior 4 quarters

3. Compare hiring ratio of vets to total

4. Assessment of efforts

5. Any other unique factor

• Required: apply to total workforce, not by job groups

• Different contractor establishments can use different

methods


VEVRAA: Training, Outreach, and Recordkeeping

• Linkage agreements not required• Training is mandatory• Assess effectiveness of outreach• Same obligation to periodically review

physical and mental job requirements • Retain records for 3 years• Best practices for successful OFCCP

audits in this regard – Number of sources– Identifying applicant referral sources in

written and oral questions– Review applicant information from referral

sources


VEVRAA: State Workforce Agency Listing Requirements

• General obligation to list jobs with State Workforce Agency

• List in permitted manner and format• Provide to State Workforce Agencies:

– Federal contractor status, hiring official contact information, and request for priority referrals; update contract information

– Contact information of any outside search agencies used by contractor

• OFCCP counts number of contract hires and listings with State Workforce Agencies


VEVRAA: Proving Recruitment and Outreach Effectiveness

• No violation solely for failing to meet benchmarks; a focus of compliance evaluations will be on proving outreach and recruitment

• Document and review referral sources of applicants

• Address failure of referral sources to send qualified applicants to contractor

• Role of third parties who conduct outreach and recruitment; responsibility of contractor for action or inaction of vendors


VEVRAA Recordkeeping: Three Years

• Evaluation of outreach and recruitment

• Records pertaining to data collection comparisons regarding applicants and employees

• Records relating to hiring benchmark requirements

• Temporal scope of OFCCP audits


VEVRAA: Contractors Now Required To:

• Comply with old regulations – Review personnel processes and job

qualifications– Make reasonable accommodation

available– Develop harassment prevention

policies– Engage in outreach– Have procedures to distribute EO

and affirmative action efforts

• New EO clause and accessibility requirements


VEVRAA: OFCCP Strongly Encourages Contractors to Begin Subpart C Compliance

• Pre-offer self-ID process• EO statements with top executive support in AAP• Assess, document & retain effectiveness of outreach

and recruitment efforts annually• Document required audit and reporting system actions• Train employees engaged in key personnel activities• Conduct applicant and employee data analysis• Establish benchmarks


VEVRAA Requirements of First AAP After March 24, 2014

• Evidence of new self-ID process

• EO policy statement (exec)• Review of personnel processes• Schedule and proof of review

of job qualifications standards• Anti-harassment procedures• Outreach and recruitment • Document activities• Implementation and

dissemination of AA actions

• Evidence of audit and reporting system

• Responsible individual• Data collection • Benchmark• Address both new and old

AAP requirements• If not in compliance, explain

steps taken• No violation if contractor

shows it acted reasonably in light of particular circumstances


Section 503: Rationale for Revision

• Higher unemployment of individuals with disabilities

• Harmonize with ADAAA• “Historic” protection similar to

those for race, national origin and gender

• Director Shiu: “What gets measured, gets done.”

• Public comments: concern with new self-ID rule/ADA; 7% goal; changes from NPRM to Final Rule


Section 503 Goal – 7%

• Applies to job groups at site (no minimum size of group)

• If 100 or fewer employees, apply to entire workforce (sheltered workshops not counted in 7%; under some circumstances can mention in AAP)

• Percentage may be adjusted periodically by OFCCP

• OFCCP prepared suggested forms and charts

• EO 11246 80% rule inapplicable to 503 goal


Section 503: Failure to Meet the Goal

• “It’s not a quota”• No fine, penalty, sanction as a

result if no impediments to equal employment opportunity exist

• Not an automatic violation; “signal” of possible problem area

• Contractor to: 1) determine if and where impediments exist; and 2) develop and execute action-oriented programs

• OFCCP enforcement during first new AAP year


Section 503: Contractor Actions

• Contractor must take steps to:• Assess personnel

processes• Assess effectiveness of

outreach and recruitment• Review AAP audit• Develop and execute

action-oriented programs

• Affirmative Action Policy in policy manuals


Section 503: New Voluntary Self-Identification Requirements

• Mandatory form - January 2014• Pre-offer – provide with request for

race, gender, veteran status; separate from applications but may be with materials; after meet Internet applicant requirements (including basic qualifications)

• Post-offer• Employee:

– Within first year– Every five years– Provide at least one interim reminder


Section 503: If Voluntary Self-ID is Declined

• No coercion • Employer may identify as

disabled if:– Disability is obvious or– Disability is otherwise

known• No guessing!• Can provide contact and

other information on reasonable accommodation


Section 503: Electronic Version of Self-ID Form Provided That:

• OMB Number and expiration date

• Contain text of form without alteration

• Sans-serif font, such as Calibri or Arial

• At least 11-pitch font size (footnote and burden statement in 10-pitch)


Section 503: Solicitations and Equal Opportunity Clause

• Equal employment opportunity employer of individuals with disabilities (disability, not “d”)

• Specific equal opportunity language included in contract clauses, not just incorporated by reference (can combine)

• Electronic notice requirements (virtual employees; post notices; accommodation even for employees working at site; Braille only if requested)

• No mandatory job listings; required appropriate outreach and positive recruitment activities


Section 503: Data Collection Metrics

1. Number of applicants who are individuals with disabilities

2. Total number of applicants

3. Total number of job openings and jobs filled

4. Number of individuals with disabilities hired

5. Total number of hires

3-year retention period


Section 503: New Data Collection Analysis Requirements (Clarification)

• Job opening: – number of individual positions advertised as open in

announcement or requisition– Ex: 5 open positions with 4 filled; contractor would document as 5

job openings and 4 jobs filled

• Jobs filled: – all jobs the company filled by any means (competitive or

noncompetitive), including reassignment or merit promotion)– Both new hires and employees placed in new positions via

promotions, transfers, reassignments

• Hired: Solely refers to applicants (both internal and external) hired through competitive process, including promotions


Section 503: Reasonable Accommodation

• Appendix provides suggestions for written policy

• Best practice, but not mandatory

• Performance issues: required inquiries by supervisors if may be related to a disability


Section 503: Analysis and Recordkeeping

• Annually assess effectiveness of outreach efforts, in writing

• Identify alternatives, if necessary

• Linkage agreements not required

• Document outreach• Retain records for 3 years


Section 503: Audits

• Temporal scope• Format of employer’s records• On-site or off-site• Pre-award compliance audit

procedure (similar to EO)


Section 503: Contractors Now Required To:

• Comply with old regulations – Review personnel processes and job qualifications– Make reasonable accommodation available– Develop harassment prevention policies– Engage in outreach– Have procedures to distribute EO and affirmative

action efforts• New EO clause and accessibility requirements


Section 503: OFCCP Strongly Encourages Contractors to Begin Subpart C Compliance• Pre-offer self-ID process; initial employee self-identification survey

• EO statements with top executive support in AAP

• Applicants and employees have equal access to personnel processes, including electronically

• Assess, document & retain effectiveness of outreach and recruitment efforts annually

• Document required audit and reporting system actions

• Train employees engaged in key personnel activities

• Conduct applicant and employee data analysis by calculating applicant and hire data

• Conduct annual workplace assessment; apply 7%

• Develop action plans for resolving problems identified in utilization of individuals with disabilities


Section 503 Requirements of First AAP After March 24, 2014

• Evidence: new self-ID processes • EO policy statement • Review of personnel processes• Schedule and proof of review of job

qualifications standards• Anti-harassment procedures• Assess and document effectiveness

of outreach and recruitment • Document activities• Implementation and dissemination

of AA actions• Evidence of audit and reporting

system• Responsible individual

• Data collection• Snapshot of disability

composition of workforce, results of utilization analysis and application of goal, discussion of problem areas and actions to address

• Address both new and old AAP requirements

• If not in compliance, explain steps taken

• No violation if contractor shows it acted reasonably in light of particular circumstances


Presented by:

Celia M. JosephPhone: (610) 230-2144

Email: [email protected]





38

Questions?


Presented by:

Celia M. JosephPhone: (610) 230-2144

Email: [email protected]





39

Thank You

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