Hunton Employment & Labor Perspectives

The Office of Federal Contract Compliance Programs (“OFCCP”) has issued a proposed rule to strengthen the current regulations that require federal contractors and subcontractors to engage in affirmative action efforts for veterans. The proposed rule was published in the Federal Register on April 26, 2011. Fed. Reg. 23,358 (Apr. 26, 2011). Public comments regarding the rule are due by June 27, 2011.

The OFCCP’s proposed rule would revise the regulations that implement the Vietnam Era Veterans’ Readjustment Assistant Act (“VEVRAA”), 41 CFR Parts 60-250 and 60-300, which have generally remained unchanged since 1976. VEVRAA, its amendments and regulations prohibit contractors from discriminating against protected veterans and additionally require contractors to take affirmative action to recruit, employ, and advance the employment of protected veterans. VEVRAA also requires certain contractors to maintain a written Affirmative Action Plan.

The proposed rule includes several significant changes including a shift in the overall tone of the regulations from providing suggestions for compliance to now issuing mandates for compliance. Below are several examples of actions contractors must take under the proposed rule.

• Mandatory Job Listing Requirements. Contractors must provide the state employment service with the following information annually; 1) status as federal contractor; 2) contact information for the contractor hiring official at each location in the state; 3) contractor’s request for priority referrals of protected veterans for job openings; and 4) contact information for any outside job-search companies used by the contractor.
• Pre-Offer Invitation to Self-Identify. Contractors must invite all applicants to self-identify as a protected veteran prior to being offered a job.  (Applicants would not be required to specify which type of protected veteran he or she is.)
• Increased Data Collection. Contractors must collect the following data annually and maintain records of this data for five years;
  • Total number of referrals; number of priority referrals of protected veterans received; and ratio of referred protected veterans to total referrals.
  • Total number of applicants; number of applicants who are known protected veterans; and ratio of protected veteran applicants to total applicants.
  • Total number of people hired; number of protected veterans hired; and ratio of protected veterans hires to total hires.
  • Total number of job openings; number of jobs filled; and ratio of job openings to job openings filled.
• Hiring Benchmarks. Contractors must establish annual hiring benchmarks. The benchmark will be established by determining the percentage of total hires who are protected veterans that the contractor seeks to hire in the following year.
• Annual Evaluation of Recruitment Efforts. Contractors must evaluate the effectiveness in identifying and recruiting qualified protected veterans and document this review. Contractors should review the number of protected veteran referrals, applicants and hires for the current year and two previous years.

The increased obligations presented in the proposed rule will likely have a significant impact on federal contractors. If the rule is finalized as drafted, contractors will face greater burdens in terms of data tracking, data collection and record keeping. Because contractors will likely need to overhaul their internal practices and procedures to satisfy these burdens, contractors should follow the proposed rule closely in order to be prepared to implement the necessary changes to achieve compliance.