LEL Flash | Issue: November/December 2013

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Issue: November/December 2013

Special Feature

A Step in the Right Direction: Final Rules Published for Affirmative Action and Anti-Discrimination Obligations for Federal Contractors in the Employment of Veterans and Individuals with Disabilities

Note: This article is written from an employee perspective. Coverage on this topic from a management perspective was presented in the September 2013 issue of the FLASH.

For far too long, veterans and individuals with disabilities have lagged behind others when it comes to employment and compensation. U.S. Bureau of Labor Statistics (BLS) data show that post-9/11 veterans (about 2.6 million through 2012) are unemployed at a rate of 9.9 percent, compared with 7.9 percent for non-veterans. For male post-9/11 veterans age 18 to 24, that number jumps to 20 percent, compared with 16.4 percent for male non-veterans in that same age group. Furthermore, post-9/11 veterans who are employed make less than their non-veteran counterparts, with males earning 2.7 percent less and females 6.3 percent less.

These BLS figures look even worse for individuals with disabilities (IWDs). Working-age IWDs are unemployed at a rate of 15 percent, nearly double the 8 percent unemployment rate for working-age individuals without disabilities. With comparatively limited hopes for finding work, the IWD workforce participation rate is a dismal 31.6 percent for working age people (compared with 76.5 percent for working-age non-IWDs). This yawning gap is present in compensation comparatives as well. For households where a working-age "householder" reported a disability, median household income was only $25,420 (compared with $59,411 for households without a householder reporting a disability). This helps to explain the 28.8 percent poverty rate for working-age IWDS, which is significantly higher than the 12.5 percent poverty rate for non-IWDs.

Thus, on August 27, 2013, the U.S. Department of Labor's (DoL) Office of Federal Contract Compliance Programs (OFCCP)--the entity tasked with enforcing affirmative action and equal employment opportunities for applicants and employees of contractors doing business with the federal government--announced Final Rules designed to address some of these languishing inequities. The OFCCP found the above data to be compelling evidence of "substantial disparities," which require the strengthening of regulations implementing the Vietnam Era Veterans' Readjustment Assistance Act (VEVRAA) and the Rehabilitation Act of 1973. The DoL published the Final Rules in the Federal Register on September 24, 2013, thus making them effective on March 24, 2014. Here is what you need to know about these changes to the regulations.

VEVRAA

Final Rule changes for VEVRAA affect job postings, data collection and access, and set hiring "benchmarks." When contractors list their job openings, the information they post must be compatible with appropriate state and local job services (e.g. formatting). This will help to ensure that these job services can access, utilize and promote these job opportunities in a manner more likely to reach veterans. In addition, contractors will be required to invite applicants to identify themselves as protected veterans, both before and after a job offer is made.

OFCCP will also have stronger oversight capabilities under the new regulations. Federal contractors must allow OFCCP to review records relevant to compliance checks and focused reviews. Further, OFCCP may request these documents in any format maintained by the contractor, and the records may be reviewed either on-site or off-site, at OFCCP's option.

Finally, the responsibility for continuing evaluation is shared by the contractors under the Final Rule. Each contractor must incorporate specific equal opportunity language into their subcontracts, thus alerting subcontractors to their compliance responsibilities. Contractors must also collect and maintain certain data, such as applications, offers and acceptancces of protected veterans. This information will provide contractors with an overall picture of how their veteran recruiting and retention efforts have fared. Every year, federal contractors will establish benchmarks based on the national percentage of veterans in the civilian workforce, or other BLS data.

Rehabilitation Act of 1973

Similar to Final Rule changes to VEVRAA, regulations strengthening the Rehabilitation Act of 1973 also reflect (1) the inclusion of an EO clause in subcontracts, (2) invitations for protected IWDs to self-identify at the pre- and post-offer stages of the application process, (3) expanded access to records for OFCCP review, and (4) data collection mandates for the federal contractors. Moreover, this Final Rule brings the Rehabilitation Act into line with its cousin, the Americans with Disabilities Act of 1990 (ADA), which was itself strengthened by the ADA Amendments Act of 2008 (ADAAA). Among the provisions of the ADAAA, this Final Rule implements revisions of the definition of "disability" (to be more inclusive).

One stark difference in this Final Rule, and the item most likely to cause controversy, is the "utilization goal" provision. Here, OFCCP is establishing a nationwide 7% goal for qualified IWDs, whereby contractors will apply this goal at the "job group level." In an OFCCP fact sheet, the Office states that this utilization goal "is not to be used as a quota or ceiling," and that failure to meet the goal "is not a violation of the regulation and it will not lead to a fine, penalty or sanction." Nonetheless, the OFCCP is clearly laying down a marker showing its seriousness to make progress in this area.

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The effects of these Final Rules will not be immediately apparent. Aside from the obvious fact that a couple years of data are necessary to gauge their efficacy, federal contractors who have a written affirmative action program (AAP) already in place as of the effective date need not make any changes on that date. Instead, these contractors are able to wait until the beginning of their next AAP cycle.

These improvements cannot come soon enough. As the figures at the outset of this article demonstrate, veterans and IWDs are far more likely to be unemployed and underpaid as compared with their non-veteran/non-IWD counterparts. Though success is far from certain, these OFCCP Final Rules are a positive leap forward.

Daniel J. Kaspar, National Treasury Employees Union and Heidi R. Burakiewicz, Mehri & Skalet PLLC.

Contents

Opening Page

Comments from the Chair

Feature: Recent Developments in Pregnancy Discrimination

Feature: Diversity in the Legal Profession Committee Sees Positive Impact of United States v. Windsor

Flash Co-Chairs:
Jeremy J Glenn, Meckler Bulger et al | Monique R. Gougisha, Ogletree Deakins | Amy F. Shulman, Broach & Stulberg LLP | Jennifer R. Spector, National Labor Relations Board

American Bar Association Section of Labor and Employment Law
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