Procurement managers working for federal contractors and subcontractors need to become familiar with new rules governing the hiring of individuals with disabilities which will likely become law late in the first quarter of 2014.
The U.S. Labor Department’s Office of Federal Contract Compliance Programs (OFCCP) last month released its Final Rules and reportedly plans to publish them in the Federal Register by the end of the month, which means they will become law 180 days later. The rule amends Section 503 of the Rehabilitation Act of 1973, which prohibits discrimination against individuals based on disability by federal contractors and subcontractors. It also requires both types of companies to recruit, employ, train and promote qualified people with disabilities.
The rule is designed to reduce ongoing barriers to equal employment opportunities and address income inequality and poverty among the disabled. It also implements changes necessitated by the Americans with Disabilities Act Amendments Act of 2008, including the definition of disability.
Highlights of the rule include:
- Establishment, for the first time, of a 7-percent “utilization goal” for individuals with disabilities. This can be applied at the job group level in large companies, or company-wide in small firms. The number is not a quota or ceiling, however, but a “management tool that informs decision-making and provides … accountability,” the OFCCP says. Failure to meet the utilization goal will neither violate the rule nor lead to fines, penalties or sanctions.
- Requiring contractors to give applicants a chance to voluntarily self-identify as having disabilities at the pre-offer stage of hiring or after receiving job offers. This is meant to give contractors data that help them determine the success of outreach and recruitment.
- Requiring contractors to invite current employees to voluntarily self-identify as having a disability, since their status may change.
- Maintaining quantitative measurements and comparisons regarding the number of individuals with disabilities who apply for jobs and the number hired. These data are intended to help contractors and the OFCCP determine the effectiveness of outreach, recruitment and selection by companies.
- Prime contractors must add mandated language to contracts that alert subcontractors to their responsibilities under the new rule.
Among problems plaguing the disabled that the OFCCP cites for the New Rule are a workforce participation rate last year of 31.6 percent for working age people, compared with 76.5 percent for people without disabilities. (Numbers represent the percentage of people 16-64 who are employed, and those who are unemployed but looking for work, which is why they exceed 100 percent.).
BLS data also show higher unemployment last year for working age people with disabilities (15 percent compared with 8 percent for those without disabilities); lower median household income in 2011 for households with disabled workers ($25,420 versus $59,411); and a higher poverty rate (28.8 percent compared with 12.5 percent).
Procurement managers at contractors that do business with the federal government should meet with human resources directors to learn how to prepare for the New Rule.