Section 503 remains the headliner.
The Office of Federal Contract Compliance Programs published today three final rules addressing the regulations implementing Section 503 of the Rehabilitation Act, the Vietnam Era Veterans’ Readjustment Assistance Act, and now-revoked Executive Order 11246.
As we reported when the rules were proposed, the most significant changes involve the Section 503 requirements for individuals with disabilities.
Section 503: Elimination of self-identification and utilization goal
The Section 503 final rule will take effect September 21 and eliminates three major requirements for contractors:
- The requirement to invite applicants and employees to self-identify as individuals with disabilities.
- The requirement to collect, retain, and analyze data concerning applicants and hires who self-identify as individuals with disabilities.
- The 7 percent utilization goal for individuals with a disability and the related requirement to conduct an annual utilization analysis for each job group.
The OFCCP says that requiring contractors to ask applicants and employees about their disability status conflicts with the Americans with Disabilities Act, which prohibits most pre-employment medical inquiries. The OFCCP also concluded that the utilization analysis became unworkable after the revocation of Executive Order 11246 because the analysis depended on job groups created for E.O. 11246 affirmative action programs.
The final rule also clarifies that contractors are not required to consider quantitative data concerning referrals, applicants, or hires when evaluating the effectiveness of their outreach efforts or affirmative action programs. Contractors may use other measures, such as reviewing workplace accessibility and accommodation practices.
But Section 503 is not going away.
Contractors with 50 or more employees and a federal contract or subcontract of at least $50,000 must still maintain a Section 503 affirmative action program. The non-discrimination, reasonable accommodation, outreach and recruitment, assessment of recruitment efforts, and other affirmative action requirements remain in place.
The rule also updates the basic Section 503 non-discrimination coverage threshold from $15,000 to $20,000 to reflect the inflation adjustment that took effect on October 1, 2025.
VEVRAA: Mostly business as usual
The VEVRAA final rule, also effective September 21, is much less dramatic.
The rule does not eliminate the protected veteran self-identification requirements, data collection analysis, annual hiring benchmark, or written AAP requirements. Instead, it primarily removes obsolete references to Executive Order 11246.
The most important practical change is the codification of the increased contract threshold. The threshold for VEVRAA coverage and the written AAP requirement has increased from $150,000 to $200,000. Thus, the written AAP requirement now applies to contractors with 50 or more employees and a federal contract or subcontract of at least $200,000.
Contractors should not dismantle their VEVRAA processes along with their Section 503 self-identification and utilization procedures. The veteran self-identification, data collection, outreach, benchmark, and AAP requirements continue.
Executive Order 11246 regulations are officially scrapped
Finally, the E.O. 11246 final rule, which will take effect on October 26, formally rescinds the regulations that implemented the Executive Order.
President Trump revoked E.O. 11246 in January 2025, and the OFCCP subsequently stopped enforcing it. The final rule published today removes the regulations governing race- and sex-based affirmative action programs for supply and service and construction contractors, along with the former E.O. 11246 non-discrimination and pay transparency provisions.
The rule also removes the OFCCP’s version of the Uniform Guidelines on Employee Selection Procedures from its regulations. However, the OFCCP specifically notes that this change does not affect other federal agencies’ interpretations or applications of the Guidelines.
What should contractors do now?
Before September 21, contractors should update their Section 503 AAP templates, applicant tracking systems, employee survey processes, and Human Resources platforms to remove the OFCCP-mandated disability self-identification process. They should also develop alternative methods for evaluating the effectiveness of disability outreach and affirmative action efforts.
At the same time, contractors should continue to comply with their remaining Section 503 obligations, including VEVRAA self-identification, data collection, hiring benchmark, and AAP processes.
For guidance or assistance with these changes, please contact a member of Constangy’s EEO/Contractor Compliance, Reporting & Analytics Practice Group.
PartnerCara co-chairs Constangy’s practice groups relating to EEO/Contractor Compliance, Reporting & Analytics, and DEI Compliance. She advises employers on proactive strategies to help avoid litigation and has defended employers ...
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