Executive Summary. The Office of Federal Contract Compliance Programs (OFCCP) has released its final rule implementing Executive Order 13672, signed by President Obama on July 21, 2014, which prohibits federal contractors from discriminating against individuals on the basis of sexual orientation or gender identity. The final rule is scheduled to be published in the Federal Register on December 5, 2014, but the pre-publication version is available for public inspection on the Federal Register Daily Journal page here. The OFCCP has published a list of Frequently Asked Questions regarding the rule, which are available at http://www.dol.gov/ofccp/LGBT/LGBT_FAQs.html. The rule will be effective 120 days from its publication in the Federal Register and will apply to federal contracts entered into or modified after the effective date.

The Executive Order

As discussed in our prior Legal Alert, Executive Order 13672 amends Executive Order 11246 to add gender identity and sexual orientation to the protected categories listed in that EO. EO 11246 applies to federal contractors and federally-assisted construction contractors and subcontractors that have federal government contracts of $10,000 or more.            

The Final Rule

The Final Rule implements EO 13672 by replacing the words "sex, or national origin" with the words "sex, sexual orientation, gender identity, or national origin" throughout the EO 11246 implementing regulations. Thus, under EO 11246, the following categories are protected from discrimination in the workplace:  race, color, religion, sex, sexual orientation, gender identity and national origin.  The only affirmative action obligations impacted by the Final Rule are those contained in 41 CFR Part 60-1. The preamble to the Final Rule states that contractors can fulfill this requirement by including the updated Equal Opportunity Clause in new or modified subcontracts and purchase orders, ensuring that applicants and employees are treated without regard to their sexual orientation and gender identity, and by updating the equal opportunity language used in job solicitations and posting updated notices.

The OFCCP accepts and investigates administrative complaints from applicants or employees who believe they were subjected to discrimination.  As of the effective date of EO 13672, the OFCCP will accept complaints of discrimination on the basis of sexual orientation or gender identity.   

The preamble to the new regulations also states that the Final Rule does not require contractors to set placement goals on the bases of sexual orientation or gender identity, nor does the rule require contractors to collect and analyze data on these bases. The Final Rule also does not diminish the DOL's position that discrimination on the basis of gender identity or transgender status is a form of sex discrimination as set out in Macy v. Holder, EEOC Appeal No. 0120120821 (April 20, 2012), and in the OFCCP's Directive on Gender Identity and Sex Discrimination.