Section 503 of the Rehabilitation Act of 1973, 29 U.S.C. § 793, requires federal contractors to employ and advance persons with disabilities through affirmative action practices. This section requires federal contractors to ask applicants to self-identify whether they have a disability. Additionally, all federal contractors must set a 7% utilization goal for employing people with disabilities.
In August, the Department of Labor promulgated a proposed rule to change section 503. The rule seeks to rescind the requirement that applicants be invited to self-identify their disabilities and also removes the 7% utilization goal. The comment period for the proposed changes was through October 2025.
The DOL argues that Section 503 requirements conflict with the Americans with Disabilities Act (“ADA”) because it requires that federal contractors make pre-employment inquiries regarding disabilities. Additionally, under the ADA, employers can only ask about an employee’s disability when it is job-related and necessary for business reasons. However, there is a specific exclusion under the ADA that Section 503 falls under: 29 C.F.R. § 1630.13(a), § 12112(d)(2)(A) “does not prohibit a covered entity from . . . making pre-employment inquiries required by another Federal law or regulation, such as those of the Office of Federal Contract Compliance Programs (OFCCP). . .” Furthermore, inviting applicants and employees to self-identify has always been voluntary for employees.
The effect of these new rules would be to significantly reduce data collection on the disability status of applicants and employees for federal contractors.
DOL already rescinded EO 11246 and dismantled the OFCCP, and proposed modest amendments to the Veterans’ Employment and Readjustment Assistance Act (“VEVRAA”).
If you have any questions about the changing landscape of federal contract compliance, please reach out to Employers Council at info@employerscouncil.org.
Amanda Bauer is an attorney with Employers Council.