The U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) published its final rule requiring all covered federal contractors to self-audit their affirmative action programs for veteran and disabled workers. The new self-audit rule is different from the former requirements of Section 503 of the Rehabilitation Act and the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA). The former regulations simply required that federal contractors implement outreach and recruitment efforts. The new rule expands those past obligations and sets forth more specific steps to compliance.

In particular, the final rule establishes a 7% utilization goal for disabled workers in each workforce job group and sets hiring benchmarks for veterans based on either the current national percentage of veterans in the workforce or the contractor’s own data. However, regardless of whether the federal contractor meets those benchmarks, the final rule requires the contractor to self-audit its outreach and recruitment efforts.

Though the new regulations separately address veterans and disabled workers, the requirements with respect to each are substantially the same. 41 C.F.R. §§ 60-300.44(f)-(h) and 60-741(f)-(h).

The new rule requires federal contractors to evaluate the efficacy of their outreach and recruitment efforts of the previous 12 months for affirmative action plans renewed on or after March 24, 2014. The OFCCP offers the following specific steps to assess outreach programs:

  1. Measure the effectiveness of the contractor’s affirmative action program.
  2. Indicate any need for remedial efforts.
  3. Determine the degree to which the contractor’s objectives were obtained.
  4. Determine whether veterans and disabled workers have had the opportunity to engage in all company sponsored educational, training, recreational and social activities.
  5. Measure the contractor’s compliance with the affirmative action program’s specific obligations.

The regulations also require a detailed report, which becomes part of the affirmative action plan, addressing the more specific steps to compliance. There is no mandatory format for this report, but the report, to be retained for three years, must include:

  1. An assessment of the effectiveness of each outreach and recruitment effort used by the contractor.
  2. The contractor’s conclusion on the program’s effectiveness.
  3. An evaluation of the annual hiring metrics data for the current year, as well as the two previous years.

If the federal contractor decides its outreach efforts were not effective, then the contractor must implement alternative or additional outreach efforts to increase the numbers of disabled and veteran workers in its workforce. The final rule still provides contractors with flexibility in deciding which outreach and recruitment efforts they want to implement.

In addition to the written assessment reports, the final rule requires assessments of certain hiring metrics for veterans and disabled workers. Contractors must document and annually update the following:

  1. The number of protected veteran/disabled applicants.
  2. The total number of applicants for all jobs.
  3. The total number of job openings and jobs filled.
  4. The number of protected veterans/disabled workers hired.
  5. The total number of applicants hired.

These records also must be maintained for three years. 41 C.F.R. §§ 60-300.44(k) and 60-741(k).

During audits, the OFCCP will review these assessments to determine if they are “reasonable.” Given the OFCCP's wide discretion in reviewing assessments, federal contractors should be sure to have compliant, well-documented assessment plans available for OFCCP review.