New Regulations for Section 503 and VEVRAA Demystified

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By: Amira Fahmy, Director of Community Development, GettingHired

The wait is finally over! After months of speculation, OFCCP has officially released the final ruling on the new regulations for Section 503 of the Rehabilitation Act and the Vietnam Era Veterans' Readjustment Assistance Act (VEVRAA). The changes made in the final regulations are unprecedented, and we believe it is going to be a historic turning point when it comes to the employment of individuals with disabilities with federal contractors and subcontractors.

Over the last few months we wrote a few articles discussing the proposed changes to 503, and well, most of our hypotheses of what would pass were incorrect. Under the new regulations contractors are not required to form formal linkage agreements or develop training around specific topics. In those areas, the regulations maintained their existing requirements. That said, the proposed 7% utilization goal for hiring individuals with disabilities did pass, which is truly a monumental event!

For the first time ever, Section 503 will require a national utilization goal of 7% for employment of individuals with disabilities for each job group within a contractor's workforce (or 7% of the total workforce if the contractor has less than 100 employees). Similarly, VEVRAA requires contractors to establish a national benchmark for hiring protected veterans. Contractors will be able to set their own benchmark using existing data on veteran availability, or they can adopt the annual hiring benchmark established by OFCCP, which is currently set at 8%.

In addition to the utilization goals and benchmarks, there is also a requirement for contractors to invite applicants to voluntarily self identify as an individual with a disability or a protected veteran during the pre and post offer stages of the hiring process. This will help contractors analyze the effectiveness of their recruitment and outreach programs.

So what does that mean?

Most importantly, it means more job opportunities for individuals with disabilities and protected veterans (which includes disabled veterans)! Because of the new regulations, OFCCP estimates that federal contractors will hire an additional 594,000 individuals with disabilities, and 84,000 veterans with disabilities. That is huge, especially at a time when the unemployment rate for individuals with disabilities is almost twice as high as the national average, and the labor force participation is only at 20.3% (compared to 69.7% for those without a disability). These regulatory changes will also create more awareness around the existing issues and can serve as a platform for change.

For employers, these new regulations might seem overwhelming at first, but they can also be a great opportunity. Studies have shown that hiring people with disabilities is a good business decision. The benefits for hiring individuals with disabilities include increased retention (and less training costs due to turn over), access to new markets, increased innovation, and a diverse workforce, to name a few. While contractors will likely have to make some changes to their current processes, the long term investment will be well worth it.

Employers should also note that OFCCP was very clear in saying that these utilization goals and benchmarks are not rigid and inflexible quotas which must be met, and contractors will not be cited for violations solely for failing to meet them. They are simply a tool provide the contractor with a quantifiable means to measure its progress towards achieving equal employment opportunity for individuals with disabilities and protected veterans.

Like with all change, it will take some time before these new regulations are fully implemented and we start seeing the impact. That said, we believe this is a great step towards equal employment opportunity for individuals and veterans with disabilities.

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About GettingHired, Inc.

GettingHired, Inc., is an online service organization focused on creating employment opportunities for job seekers with disabilities and helping employers find talent. The company is well known for its national employment and networking portal GettingHired.com. GettingHired.com connects talented job seekers who happen to have disabilities with employers, advocacy organizations, and service providers.