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All in a Day's Work® - Insights on Labor & Employment Law

Long-anticipated VEVRAA and Section 503 regulations finally published

On September 24, 2013, the United States Department of Labor (DOL) published two rules that will purportedly improve hiring and employment of veterans and people with disabilities. One rule updates requirements under the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA) and the other rule updates requirements under Section 503 of the Rehabilitation Act of 1973 (Section 503).

The VEVRAA rule requires contractors to establish a metric by which to measure their success in recruiting and employing veterans. For purposes of VEVRAA, the metric is called a “benchmark” and is either based on the national percentage of veterans in the workforce (currently 8%) or the contractor’s own benchmark based on the best available data. The rule will require contractors to evaluate yearly the progress they have made on reaching their benchmark. The new VEVRAA rule also clarifies veteran job listings and subcontract requirements to facilitate compliance.

The Section 503 rule introduces another “utilization goal” for federal contractors and subcontractors – that 7% of each job group in their workforce (or their entire workforce if 100 or fewer employees) be qualified individuals with disabilities. Again, under the new rule, contractors will be required to evaluate their utilization goal yearly to determine whether progress is being made with respect to hiring individuals with disabilities. The rule also details specific actions contractors must take in the areas of recruitment, training, record keeping, and policy dissemination, which are similar to those actions that are required to promote workplace equality for women and minorities pursuant to Executive Order 11246.

The new rules become effective 180 days after their publication (March 24, 2014). Contractors are expected to be in compliance with subparts A, B, D, and E by March 24.  Some of the major changes from these subparts include:

  1. the addition of required text for Section 503 and VEVRAA Equal Opportunity clauses in subcontracts and purchase orders,
  2. requirements related to job postings with the state workforce agency job bank or with the local employment service delivery system (ESDS), and
  3. equal opportunity posting requirements for applicants and employees.

For subpart C of the new rules, which involve the setting of the “benchmarks” and “utilization goals,” contractors may delay their compliance until the start of their next affirmative action plan cycle.  In this subpart, many of the changes require collection of new data points, including:

  1. a pre-offer invitation to self-identify,
  2. utilization goal (Section 503 only) and hiring benchmark (VEVRAA only), and
  3. data collection and analysis.

Although compliance with the final regulations is being rolled out in phases, it is important to start considering now how these updates will affect your operating systems and/or procedures.


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