[Federal Register Volume 78, Number 185 (Tuesday, September 24, 2013)]
[Rules and Regulations]
[Pages 58613-58679]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-21227]



[[Page 58613]]

Vol. 78

Tuesday,

No. 185

September 24, 2013

Part II





Department of Labor





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Office of Federal Contract Compliance Programs





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41 CFR Parts 60-250 and 60-300





Affirmative Action and Nondiscrimination Obligations of Contractors and 
Subcontractors Regarding Special Disabled Veterans, Veterans of the 
Vietnam Era, Disabled Veterans, Recently Separated Veterans, Active 
Duty Wartime or Campaign Badge Veterans, and Armed Forces Service Medal 
Veterans; Final Rule

Federal Register / Vol. 78 , No. 185 / Tuesday, September 24, 2013 / 
Rules and Regulations

[[Page 58614]]


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DEPARTMENT OF LABOR

Office of Federal Contract Compliance Programs

41 CFR Parts 60-250 and 60-300

RIN 1250-AA00


Affirmative Action and Nondiscrimination Obligations of 
Contractors and Subcontractors Regarding Special Disabled Veterans, 
Veterans of the Vietnam Era, Disabled Veterans, Recently Separated 
Veterans, Active Duty Wartime or Campaign Badge Veterans, and Armed 
Forces Service Medal Veterans

AGENCY: Office of Federal Contract Compliance Programs, Labor.

ACTION: Final rule.

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SUMMARY: The Office of Federal Contract Compliance Programs (OFCCP) is 
publishing revisions to the current implementing regulations of the 
Vietnam Era Veterans' Readjustment Assistance Act of 1974, as amended 
by the Jobs for Veterans Act of 2002, (VEVRAA). OFCCP is responsible 
for enforcement of VEVRAA, which prohibits employment discrimination 
against protected veterans by covered Federal contractors and 
subcontractors. VEVRAA also requires each covered Federal contractor 
and subcontractor to take affirmative action to employ and advance in 
employment these veterans.
    The final rule strengthens several provisions that are intended to 
aid in recruitment and hiring efforts, such as clarifying the mandatory 
job listing requirements, requiring data collection pertaining to 
protected veteran applicants and hires, and establishing hiring 
benchmarks to assist in measuring the effectiveness of their 
affirmative action efforts. However, some of the proposals set forth in 
the NPRM, particularly with regard to the creation and maintenance of 
certain records and specific mandated affirmative action obligations, 
have been eliminated or made more flexible in order to reduce the time 
and cost burden on contractors. The specific revisions made, and the 
rationale for making them, are set forth in the Section-by-Section 
Analysis.

DATES: Effective Date: These regulations are effective March 24, 2014.

FOR FURTHER INFORMATION CONTACT: Debra A. Carr, Director, Division of 
Policy, Planning and Program Development, Office of Federal Contract 
Compliance Programs, at 200 Constitution Avenue NW., Room C-3325, 
Washington, DC 20210, or by calling (202) 693-0104 (voice) or (202) 
693-1337 (TTY). Copies of this rule in alternative formats may be 
obtained by calling (202) 693-0103 (voice) or (202) 693-1337 (TTY). The 
alternative formats available are large print and electronic file on 
computer disk. The rule also is available on the Internet on the 
Regulations.gov Web site at http://www.regulations.gov or on the OFCCP 
Web site at http://www.dol.gov/ofccp.

Executive Summary

I. Purpose of the Regulatory Action

    The Office of Federal Contract Compliance Programs (OFCCP) is a 
civil rights, worker protection agency which enforces an Executive 
Order and two laws that prohibit employment discrimination and require 
affirmative action by companies doing business with the Federal 
Government.\1\ Specifically, Federal contractors must engage in 
affirmative action and provide equal employment opportunity without 
regard to race, color, religion, sex, national origin, disability, or 
status as a protected veteran. Executive Order 11246, as amended, 
prohibits employment discrimination on the basis of race, religion, 
color, national origin, and sex. Section 503 of the Rehabilitation Act 
of 1973, as amended, prohibits employment discrimination against 
individuals with disabilities. The Vietnam Era Veterans' Readjustment 
Assistance Act of 1974, as amended, (VEVRAA) prohibits employment 
discrimination against certain protected veterans. Contemporaneous with 
these revisions, OFCCP is also publishing revisions to the implementing 
regulations of Section 503 of the Rehabilitation Act of 1973 (section 
503). OFCCP has historically viewed these regulations together, 
maintaining identity between the two regulations where possible and 
allowing contractors to prepare an Affirmative Action Plan that covers 
both laws jointly. Accordingly, the vast majority of the revisions 
announced here in the VEVRAA regulation are also present in the section 
503 rule. The exceptions to this--mainly in the structure of the hiring 
benchmark/goal for the two rules, are discussed in further detail 
below.
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    \1\ Executive Order 11246, as amended; Section 503 of the 
Rehabilitation Act of 1973, as amended, (Section 503); and the 
Vietnam Era Veterans' Readjustment Assistance Act of 1974, as 
amended, 38 U.S.C. 4212 (VEVRAA.).
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    The existing implementing regulations for VEVRAA are split into two 
separate parts: 41 CFR part 60-250 (part 60-250) and 41 CFR part 60-300 
(part 60-300). Part 60-250 applies to any Government contract or 
subcontract of $25,000 or more entered into before December 1, 2003, 
while part 60-300 applies to any Government contract or subcontract of 
$100,000 or more entered into on or after December 1, 2003. The final 
rule rescinds the regulations at part 60-250, as discussed in full in 
the Section-by-Section Analysis below. With regard to part 60-300, 
however, the final rule retains many of the revisions set forth in the 
notice of proposed rulemaking (NPRM).
    OFCCP evaluates the employment practices of over 4,000 Federal 
contractors and subcontractors annually, and investigates individual 
complaints. OFCCP also engages in outreach to employees of Federal 
contractors to educate them about their rights, and provides technical 
assistance to contractors on their nondiscrimination and affirmative 
action obligations. We estimate that our jurisdiction covers 
approximately 200,000 Federal contractor establishments, and an 
estimated 50,000 parent companies.\2\
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    \2\ This establishment estimate is based on a review of FY 2009 
EEO-1 contractor establishment data and other contractor databases, 
including the Federal Procurement Data System (FPDS). Based on EEO-1 
data, we determined that the ratio of parent companies to the number 
of establishments is approximately four establishments per parent 
company.
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    Although progress has been made in the employment of veterans, the 
number of unemployed veterans still remains too high, and substantial 
disparities in unemployment and pay rates continue to persist, 
especially for some categories of veterans. The annual unemployment 
rate for post-September 2001 veterans, referred to as ``Gulf War-era II 
veterans,'' is higher than the rates for all veterans and for 
nonveterans. BLS data on the 2012 employment situation of veterans show 
that about 2.6 million of the nation's veterans had served during Gulf 
War-era II.\3\ In 2012, the unemployment rate for Gulf War-era II 
veterans was 9.9 percent compared to nonveterans at 7.9 percent.\4\ 
However, the unemployment rate, in the same year, for male Gulf War-era 
II veterans age 18 to 24 was 20.0 percent, higher than the rate for 
nonveterans of the same age group (16.4 percent).\5\
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    \3\ U.S. Bureau of Labor Statistics, Economic News Release, 
``Employment Situation of Veterans Summary 2012,'' March 20, 2013, 
http://www.bls.gov/news.release/vet.nr0.htm (last accessed Aug. 8, 
2013).
    \4\ Id., ``Table A: Employment situation of the civilian non-
institutionalized population 18 years and over by veteran status, 
period of service, and sex, 2011-2012 annual averages.''
    \5\ Id.
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    OFCCP also found that, on average, wages of veterans (defined as 
anyone who is employed and reported serving

[[Page 58615]]

in the military in the past) are higher than non-veterans. However, 
there are different age groups represented in each era, and because 
earnings generally increase with age, we controlled for age and race in 
a regression analysis. Using America Community Survey (ACS) data and 
conducting a regression analysis, OFCCP found that:
     Male veterans earn 2.7 percent less than non-veterans.
     Female veterans earn 6.3 percent than non-veterans.\6\
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    \6\ OFCCP's labor economist conducted the regression analysis. 
All models were run using the American Community Survey 2008-2010 
Public Use Microdata (PUMS). The models that examine veterans only 
were also run with the ACS 2006-2010 files, but the results were 
largely the same, so we use the 2008-10 for all (since questions on 
disability were only available in 2008 and after). The analysis was 
run on the private sector.
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    Controlling for the era of service, rather than just whether or not 
the person served,
     OFCCP finds that: Male Gulf War-era II veterans earn 1.4 
percent less than non-veterans.
     Male Vietnam era veterans earn 6.9 percent less than non-
veterans.\7\
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    \7\ Females comprise an estimated 14.2% (nearly 167,000 women) 
in the enlisted ranks.
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    Though it is unclear what portion of these disparities is caused by 
discrimination, employment discrimination and underutilization of 
qualified workers, such as veterans and individuals with disabilities, 
contribute to broader societal problems such as income inequality and 
poverty.
    The final rule is intended to provide contractors with the tools 
needed to evaluate their own compliance and proactively identify and 
correct any deficiencies in their employment practices. These tools 
include, for example, removing barriers related to job postings so both 
contractors can effectively post or advertise their jobs, and 
jobseekers can take full advantage of these job opportunities. It also 
includes data collection to support meaningful self-assessments of 
employment practices and the ability for contractors to adjust their 
outreach and recruitment efforts for greater effectiveness and 
efficiency when needed.

II. Statement of Legal Authority

    Initially enacted into law in 1974 and amended several times in the 
intervening years, the purpose of VEVRAA is twofold. First, VEVRAA 
prohibits employment discrimination against specified categories of 
veterans by Federal Government contractors and subcontractors. The 
universe of protected veterans includes disabled veterans, veterans who 
have separated from the military within the past three years (recently 
separated veterans), veterans who received an Armed Forces service 
medal while on active duty, and veterans who served in active duty 
during a war or in a campaign or expedition for which a campaign badge 
was authorized. Second, it requires each covered Federal Government 
contractor and subcontractor to take affirmative action to employ and 
advance in employment these veterans.
    The VEVRAA regulations found at 41 CFR part 60-250 generally apply 
to Government contracts of $25,000 or more entered into before December 
1, 2003. The threshold amount for coverage is a single contract of 
$25,000 or more; contracts are not aggregated to reach the coverage 
threshold. If a Federal contractor received a Government contract of at 
least $50,000 prior to December 1, 2003, an affirmative action program 
(AAP), the specific obligations of which are detailed at 41 CFR 60-
250.44, must be developed. See 41 CFR 60-250.40.
    The VEVRAA regulations found at 41 CFR part 60-300 apply to 
Government contracts entered into on or after December 1, 2003. The 
threshold amount for VEVRAA coverage and AAP threshold coverage is a 
single contract of $100,000 or more, entered into on or after December 
1, 2003; contracts are not aggregated to reach the coverage threshold. 
Federal contractors and subcontractors that meet the coverage threshold 
and have 50 or more employees must develop an AAP. See 41 CFR 60-
300.40. The regulations found at 41 CFR part 60-300 also apply to 
modifications of otherwise covered Government contracts made on or 
after December 1, 2003. Consequently, a contract that was entered into 
before December 1, 2003, will be subject only to the part 60-300 
regulations if it is modified on or after December 1, 2003, and meets 
the contract dollar threshold of $100,000 or more.
    In the VEVRAA context, receiving a Federal contract comes with a 
number of responsibilities, including compliance with the VEVRAA non-
discrimination and non-retaliation provisions, meaningful and effective 
efforts to recruit and employ veterans protected under VEVRAA, creation 
and enforcement of personnel policies that support the contractor's 
affirmative action obligations, maintenance of accurate records 
documenting the contractor's affirmative action efforts, and providing 
OFCCP access to these records upon request. Contractor compliance with 
these provisions is, therefore, vital to improving the employment 
opportunities of veterans protected by VEVRAA. And, given the unique 
skills and experiences that veterans have acquired as a result of their 
service, improving employment opportunities benefits not only the 
veterans and their families but also the contractor as an employer. 
Failure to abide by these responsibilities may result in various 
sanctions, including withholding progress payments, termination of 
contracts, and debarment from receiving future contracts. It also 
deprives the contractor of the opportunity to benefit from this 
uniquely qualified pool of applicants.

III. Major Provisions

    The following major provisions in the final rule would:
     Provide contractors with a quantifiable means to measure 
their success in recruiting and employing veterans by requiring, for 
the first time, that contractors establish their own or adopt a 
predetermined annual hiring benchmark (currently 8 percent based on 
national labor force data).
     Create greater accountability for employment decisions and 
practices by requiring that contractors maintain several quantitative 
measurements and comparisons for the number of veterans who apply for 
jobs and the number of veterans they hire. Having this data will also 
assist contractors and OFCCP in measuring the effectiveness of 
contractors' outreach and recruitment efforts.
     Provide knowledge and support to veterans seeking jobs by 
improving the effectiveness of the VEVRAA requirement that contractors 
list their job openings with the appropriate state employment service 
agency. Contractor job listings must be provided in a format that the 
state agency can access and use to make the job listings available to 
job seekers.
     Provide knowledge and increasing compliance by 
subcontractors with their obligations by requiring prime contractors to 
include specific, mandated language in their subcontracts alerting 
subcontractors to their responsibilities as Federal contractors.
     Create flexibility for contractors when they are 
establishing formal relationships with organizations that provide 
recruiting or training services to veterans. The relationships or 
``linkage agreements'' can be established to meet the contractors' 
specific needs, while assuring outreach to veterans seeking employment.
     Clarify the contractor's mandatory job listing 
requirements and the relationship between the contractor, its agents, 
and the state employment

[[Page 58616]]

services that providepriority referral of protected veterans.
     Repeal outdated and obsolete regulations at 41 CFR Part 
60-250 that apply to contracts entered into before December 1, 2003 and 
not since modified. OFCCP believes that all such contracts have either 
expired or been modified, and that there is, therefore, no longer a 
need for the Part 60-250 regulations.

IV. Costs and Benefits

    This is an economically significant and major rule. Veterans make 
up 7.25 percent of the employed population.\8\ Under the VEVRAA rule, 
contractors have the option of establishing their own benchmark for 
employing protected veterans or meeting a benchmark set by OFCCP, 
currently 8 percent. Assuming all contractors will choose to meet the 
OFCCP benchmark of 8 percent, OFCCP estimates that Federal contractors 
would need to hire an additional 205,500 protected veterans.\9\ 
Dividing our estimate of this rule's first-year cost by our estimate of 
the number of protected veterans expected to be hired in the first year 
because of this rule returns a cost of approximately $863 to $2,353 per 
new hire.
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    \8\ Calculation based on unpublished table, Employment status of 
persons 18 years and over by veteran status, period of service, sex, 
race, Hispanic or Latino ethnicity, and disability status, Annual 
Average 2012 (Source: Current Population Survey). (10,233/141,050) * 
100 = 7.25%. The table is available on request from the Bureau of 
Labor Statistics at the Department of Labor. BLS does not release 
some tables for a variety of reasons, such as sample size or 
possibility of confusion. Finally, this estimate includes all 
veterans, not only the protected veterans.
    \9\ Based on data from the Bureau of Labor Statistics Quarterly 
Census of Employment and Wages, OFFCP estimates that approximately 
27.4 million employees could be affected.

              Total Cost of the Final Rule (Year One) \10\
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                                             Low              High
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Total Cost of the Rule..............      $177,296,772      $483,560,138
Cost Per Company....................             3,830             7,120
Cost Per Establishment..............             1,035             1,924
Company Cost Per Hire...............               863             2,353
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    \10\ The high cost estimates are based on the highest contractor 
establishment count of 251,300 and 67.919 companies while the low 
estimates are based on a contractor establishment count of 171,275 
and 46,291 companies.

                                                                 Projected Veteran Hires
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                                                                     Year 1            Year 2            Year 3            Year 4            Year 5
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Employees of Fed Contractors (assuming steady with population)     27,400,000.00     27,610,980.00        27,823,584     28,037,826.15     28,253,717.41
Veterans......................................................      2,192,000.00      2,208,878.40      2,225,886.76      2,243,026.09      2,260,297.39
Veterans Gap..................................................        205,500.00        207,082.35        208,676.88        210,283.70        211,902.88
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Present value costs over ten years for the final rule range from $1.08 
billion to $3.1 billion using a 3 percent discount rate. If we use a 7 
percent discount rate then the present value costs range from $899 
million to $2.57 billion. Annualizing these costs yields a cost range 
of $127 million to $363 million at the 3 percent discount rate and $128 
million to $366 million using a 7 percent discount rate.

----------------------------------------------------------------------------------------------------------------
                                             7% discount rate                     3% discount rate
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Benefits..............................  Not Quantified...........  Not Quantified.
Costs.................................  $899 million to $2.57      $1.08 billion to $3.1 billion.
                                         billion.
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These projected hires, some of whom will require reasonable 
accommodation, will not add significant costs for the employers. 
According to a study conducted by the Job Accommodation Network (JAN), 
of the employers who gave the researchers cost information related to 
accommodations they had provided, 57 percent said the accommodations 
needed by employees cost absolutely nothing.\11\ For 43 percent of 
employers, the typical one-time expenditure by employers to provide a 
reasonable accommodation was $500. Finally, 2 percent reported that 
accommodations required a combination of one-time and annual costs.
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    \11\ Job Accommodation Network, ``Workplace Accommodations: Low 
Cost, High Impact,'' Sept. 1, 2012. Accommodation and Compliance 
Series, http://askjan.org/media/lowcosthighimpact.html (last 
accessed Aug. 9, 2013), p.3; ``Fast Facts: Reasonable Accommodations 
& The Americans with Disabilities Act,'' U.S. Chamber of Commerce & 
the Virginia Commonwealth University, Rehabilitation Research and 
Training Center on Workplace Supports,'' http://www.worksupport.com/Topics/downloads/rrtcfactsheet2.pdf (last accessed August 12, 2013).
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    In projecting the overall increase in Federal contractor employment 
of protected veterans under the VEVRAA rule and individuals with 
disabilities under the section 503 rule, there is likely to be an 
interaction between the two categories. Some of the newly hired 
individuals with disabilities will likely be protected veterans. There 
are 5.78 million people 18 years or older in the labor force with a 
disability, 822,000, or 14.21 percent, of whom are veterans.\12\
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    \12\ Calculation based on unpublished table, Employment status 
of persons 18 years and over by veteran status, period of service, 
sex, race, Hispanic or Latino ethnicity, and disability status, 
Annual Average 2012 (Source: Current Population Survey).
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    To meet the section 503 rule's utilization goal of 7 percent, 
Federal contractors would have to hire an additional 594,580 
individuals with disabilities. Assuming that the number of disabled 
veterans hired will be proportional to their share of the disabled 
labor force, then we estimate that 84,490 of the newly hired

[[Page 58617]]

individuals with disabilities will also be protected veterans.\13\ 
Subtracting 84,490 protected veterans from the target of 205,500 leaves 
121,010 non-disabled veterans needed to meet the hiring goal. Viewed 
independently, Federal contractors under VEVRAA would employ an 
additional 205,500 protected veterans and under section 503 employ an 
additional 594,580 individuals with disabilities. In the aggregate, we 
anticipate the overall number of hires across both rules will be closer 
to 715,590. We adjust the reasonable accommodation estimates based on 
the aforementioned assumptions. The total cost of providing reasonable 
accommodation to protected veterans with disabilities is $19,010,209 in 
the year the target is met and $8,037,516 in recurring costs.
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    \13\ Because of data limitations, OFCCP is using the share of 
veterans as a proxy for ``protected'' veterans. For more information 
on the difference between protected and unprotected veterans, please 
visit, http://www.dol.gov/ofccp/regs/compliance/factsheets/vetrights.htm#Q2.
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    Employers often think providing a reasonable accommodation is more 
costly than it actually is. Sometimes an accommodation may be something 
as simple as allowing someone to have their instructions tape recorded, 
or allowing someone to wear ear phones so they are not distracted by 
noise around them, or allowing someone an empty office as space when 
they have difficulty with concentration or attention span. Employers 
must provide effective accommodations but are not expected to create an 
undue hardship for themselves by doing so. Individuals seeking 
reasonable accommodation beyond what is effective have the option of 
paying the difference between the cost of the more expensive 
accommodation and the cost of what the employer will pay for an 
effective reasonable accommodation.
    We estimate the percentage of veterans in the civilian labor force 
with disabilities, with service-connected disabilities, to be 12 
percent.\14\ For all Gulf War-era veterans it is 19 percent but for 
Gulf War-era II veterans it is 24 percent.\15\ We have not found 
projections on the percentage of these populations that are likely to 
seek reasonable accommodation. The requirement to provide reasonable 
accommodations to individuals with disabilities existed under the ADA, 
and now exists under the ADA Amendments Act for employers. This is not 
a new obligation created by this rule. However, because this rule seeks 
to increase employment of protected veterans, and some of those 
veterans are expected to meet the ADA's definition of disabled and, 
therefore, are entitled to a reasonable accommodation, we estimate the 
cost of providing reasonable accommodations to those disabled protected 
veterans that we expect to be hired because of this rule.
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    \14\ Bureau of Labor Statistics, Table 6: Employment status of 
veterans 18 years and over by presence of service-connected 
disability, reported disability rating, period of service, and sex, 
August 2012, not seasonally adjusted http://www.bls.gov/news.release/vet.t06.htm (last accessed July 9, 2013).
    \15\ Id.
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    There are tangible and intangible benefits to investing in the 
recruitment and hiring of disabled veterans. Among them are employer 
tax credits, access to a broader talent pool, an expanded pool of job 
applicants, access to new markets by developing a workforce that 
mirrors the general customer base, lower turnover based on increased 
employee loyalty, and lower training costs resulting from lower staff 
turnover.\16\ According to the U.S. Business Leadership Network 
(USBLN), ``corporate CEOs understand that it's cost effective to 
recruit and retain the best talent regardless of disability.'' \17\ 
Broad public policy considerations also exist related to the decreased 
demand for and cost of social services as more people move into jobs 
and pay taxes. We were not able to quantitatively assess these broad 
societal benefits.
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    \16\ Job Accommodation Network, ``Workplace Accommodations: Low 
Cost, High Impact,'' Sept. 1, 2012. Accommodation and Compliance 
Series, http://askjan.org/media/lowcosthighimpact.html (last 
accessed Aug. 9, 2013).
    \17\ USBLN Disability at Work, and U.S. Chamber of Commerce, 
``Leading Practices on Disability Inclusion,'' http://www.usbln.org/pdf-docs/Leading_Practices_on_Disability_Inclusion.pdf (last 
accessed Aug. 9, 2013). The USBLN and Chamber report shares best 
practices from larger corporations for hiring and providing 
reasonable accommodations.
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Introduction

    Addressing the barriers our veterans face in returning to civilian 
life, particularly with regard to employment, is the focus of a number 
of Federal efforts. Among these efforts is the VOW to Hire Heroes Act 
signed into law by President Obama on November 21, 2011, which provides 
tax credits for businesses that hire veterans who are unemployed or 
have service-connected disabilities and creates a new Veteran's 
Retraining Assistance Program for unemployed veterans. Other Federal 
efforts presented during the August 2011 announcement by President 
Obama included a plan for the private sector to hire 100,000 veterans 
by the end of 2013 and creating a ``career-ready military'' which will 
``ensure that every member of the service receives the training, 
education, and credentials they need to transition to the civilian 
workforce or to pursue higher education.'' These efforts are now a part 
of the Administration's Joining Forces Initiative. Strengthening the 
implementing regulations of VEVRAA, whose stated purpose is ``to 
require Government contractors to take affirmative action to employ and 
advance in employment qualified protected veterans,'' is another 
important means by which the government can address the issue of 
veterans' employment.
    To that end, OFCCP published a notice of proposed rulemaking (NPRM) 
on April 26, 2011 in the Federal Register (76 FR 23358), seeking 
comment on a number of proposals that would strengthen the regulations 
implementing VEVRAA. The NRPM was published for a 60-day public comment 
period. The proposed regulations detailed specific actions that 
contractors and subcontractors must satisfy to meet their VEVRAA 
obligations, including increasing data collection obligations, and 
requiring covered Federal contractors and subcontractors to establish 
hiring benchmarks for protected veterans. The NPRM also proposed the 
rescission of 41 CFR part 60-250. After receiving several requests to 
extend the public comment period, OFCCP published a subsequent notice 
in the Federal Register on June 22, 2011 (76 FR 36482), extending the 
public comment period an additional 14 days.
    OFCCP received over 100 comments on the NPRM. Commenters 
represented diverse perspectives including: Approximately 40 
individuals; ten groups representing contractors; three disability 
rights advocacy groups; two veterans' associations; two unions; and two 
governmental entities. Commenters raised a broad range of issues, 
including concerns with the cost and burden associated with the 
proposed rule, the extended recordkeeping requirements, developing 
benchmarks, and the new categories of data collection and analyses. 
OFCCP carefully considered the comments in the development of this 
final rule.
    Pursuant to Executive Order (EO) 13563, the final rule was 
developed through a process that involved public participation. In 
addition to the 60-day public comment period, OFCCP conducted multiple 
town hall meetings, webinars, and listening sessions with individuals 
from the contractor community, state employment services, disability 
organizations, veterans' service organizations and other interested 
parties to understand the features of VEVRAA regulations that

[[Page 58618]]

work well, those that can be improved, and possible new requirements 
that could help to effectuate the overall goal of increasing the 
employment opportunities for qualified veterans with Federal 
contractors.

I. Compliance With the Final Rule

    Although this final rule becomes effective 180 days after 
publication, full compliance with the requirements of this final rule 
by current contractors will be phased in as follows. Current 
contractors subject to subpart C of the existing 41 CFR part 60-300 
regulations that have written affirmative action programs (AAP) 
prepared pursuant to those regulations in place on the effective date 
of this final rule may maintain that AAP for the duration of their AAP 
year. Such contractors are required to update their affirmative action 
programs to come into compliance with the requirements of subpart C of 
this final rule at the start of their next standard 12-month AAP review 
and updating cycle. OFCCP will verify a contractor's compliance with 
the requirements of this final rule if the contractor is selected for a 
compliance evaluation pursuant to Sec.  60-300.60 or subject to a 
complaint investigation pursuant to Sec.  60-300.61. The effective date 
and the approach to compliance are the same as those set forth in the 
section 503 Final Rule. OFCCP believes that adopting similar approaches 
to the effective date and to compliance makes the most sense based on 
the similarity of the two rules, and will help contractors make 
required system and process changes at one time.

II. Overview of the Final Rule

    As stated above, the final rule incorporates many of the proposed 
changes set forth in the NPRM. However, in order to focus the scope of 
the final rule more closely on key issues, and in an effort to reduce 
the burden of compliance on contractors, the final rule also revises or 
eliminates some of the NPRM's proposals. This discussion highlights the 
major provisions of the final rule and summarizes relevant comments. 
The fuller discussion of the provisions of the rule is in the Section-
by-Section Analysis.
    The final rule strengthens the affirmative action provisions for 
Federal contractors in several ways. The regulations reiterate the 
contractor's mandatory job listing requirements and the relationship 
between the contractor, its agents, and the state employment services 
that provide priority referral of protected veterans. The mandatory job 
listing obligation, which is set forth in and required by the VEVRAA 
statute, see 38 U.S.C. 4212(a)(2)(A), ensures that veterans seeking the 
assistance of state employment service delivery systems to find 
employment will be able to find job listings from Federal contractors, 
and that the delivery systems will be able to provide priority referral 
of these veterans back to contractors. The final rule also addresses 
the increased use of technology in the workplace by allowing for the 
electronic posting of employee rights and contractor obligations under 
VEVRAA and updating the manner in which compliance evaluations are 
conducted. Further, the regulations enhance data collection pertaining 
to protected applicants and hires in order to provide contractors vital 
information against which they can effectively measure their 
recruitment efforts, and establish two mechanisms--the flexible 
approach set forth in the NPRM, or a more simplified, single national 
target--from which contractors may choose in order to establish a 
hiring benchmark. These revisions will help contractors better evaluate 
their outreach efforts and modify them as needed, toward the end of 
increasing employment opportunities for protected veterans by Federal 
contractors and subcontractors. Additionally, as proposed in the NPRM, 
part 60-250 of these regulations is rescinded. However, as we discuss 
further in the Section-by-Section Analysis, part 60-300 is revised to 
provide that any protected veteran as defined in the former part 60-250 
regulations who is employed by or applies for a position with a part 
60-250 covered contractor will still be protected under the anti-
discrimination provisions of part 60-300, and will be able to file 
complaints with OFCCP regarding discriminatory treatment.
    OFCCP revised or eliminated a number of provisions from the NPRM in 
response to the comments that were received, particularly as they 
relate to the cost and burden of the rule, recordkeeping requirements, 
data collection and analyses, and benchmarks. These changes are 
summarized below.
    OFCCP received 55 comments concerning the overall burdens and costs 
of the proposed rule from several contractor groups and contractors, 
including 21 form letters. Most commenters stated that OFCCP's 
estimates in costs and hours were too low. Commenters also noted that 
OFCCP's contractor universe was too small. In response to these 
concerns, OFCCP modified the burden and costs estimates for the final 
rule. As discussed further in the Regulatory Procedures section, OFCCP 
also increased the overall contractor and subcontractor establishment 
count to 171,275 based on Fiscal Year 2009 Employer Information Report 
EEO-1 (EEO-1), the Federal Procurement Data System-Next Generation 
(FPDS-NG) report data on contractor establishments, and other 
information. These changes provide a more accurate depiction of the 
burden and cost associated with the final rule. As discussed in more 
detail below, OFCCP also made key changes to the recordkeeping 
requirements to minimize the burden on contractors.
    We received comments on the estimated number of contractor 
establishments as well, including recommending an establishment count 
of 285,390 using the Veterans Employment Training Services (VETS) 
annual report. While OFCCP declines to exclusively rely on the VETS 
report number, we present an estimated high end for the range of the 
cost of the rule based on a contractor establishment number of 251,300. 
This number is based on 2010 VETS data from their pending Information 
Collection Request.\18\
---------------------------------------------------------------------------

    \18\ OMB Control Number 1293-0005, Federal Contractor Veterans' 
Employment Report, VETS-100/VETS-100A, http://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=201104-1293-003 (last accessed 
Aug. 13, 2013).
---------------------------------------------------------------------------

    The NPRM proposed that contractors maintain data pursuant to 
Sec. Sec.  60-300.44(f)(4) (linkage agreements and other outreach and 
recruiting efforts), 60-300.44(k) (collection of referral, applicant, 
and hire data), and 60-300.45(c) (criteria and conclusions regarding 
hiring benchmarks) for five years. Twenty-three commenters opposed 
these provisions. Several of the commenters were particularly concerned 
with the burden associated with the five-year requirement. In response, 
OFCCP reduces the proposed five-year recordkeeping requirement to three 
years in the final rule. Further, in light of the comments we received, 
the final rule does not incorporate the proposal under paragraph 5 of 
the Equal Opportunity (EO) Clause and Sec.  60-300.44(k) of the NPRM to 
maintain data related to referrals from employment service delivery 
systems. The proposal required contractors to maintain quantitative 
measurements and comparisons regarding those protected veterans who 
were referred by state employment services. Commenters were concerned 
with the requirement to obtain referral data, as they indicated that 
the state employment delivery service either cannot provide data or 
provides data inconsistently across the states, and that acquiring the 
data and

[[Page 58619]]

synthesizing it would be burdensome. In reviewing the practical utility 
of the referral data in light of the burden that it would create on 
contractors, OFCCP has eliminated the requirement to collect and 
analyze referral data. Eliminating the referral data requirement and 
reducing the length of recordkeeping for the other provisions minimizes 
the burden on contractors yet still requires contractors to keep 
adequate records to aid and inform their outreach and recruitment 
efforts.
    The NPRM also proposed to require many of the affirmative action 
efforts that are only suggested in Sec.  60-300.44 of the existing 
rule. Among these were proposals requiring contractors to: review 
personnel processes on an annual basis (Sec.  60-300.44(b)); establish 
linkage agreements with three veteran-related organizations to increase 
connections between contractors and veterans seeking employment (Sec.  
60-300.44(f)); take certain specified actions to internally disseminate 
its affirmative action policy (Sec.  60-300.44(g)); and train all 
personnel on specific topics related to the employment of protected 
veterans (Sec.  60-300.44(j)). After consideration of the comments and 
taking into account the expected utility of these provisions in light 
of the burden that contractors would incur to comply with the 
proposals, OFCCP decided not to incorporate the majority of these 
proposals, and instead retains the language in the existing rule. The 
proposals in the NPRM, for the most part, required certain specific 
steps contractors must take to fulfill their already existing, general 
affirmative action obligations. These general affirmative action 
obligations--reviewing personnel processes on a periodic basis, 
undertaking appropriate outreach and positive recruitment activities, 
developing internal procedures to disseminate affirmative action 
policies, and training its employees on these policies--remain in the 
final rule. By eliminating the specific provisions but maintaining the 
general affirmative action obligations, the final rule provides the 
contractor flexibility and lesser burden while maintaining a robust 
affirmative action program.
    The final rule also modifies the approach to setting benchmarks. 
The NPRM proposed requiring contractors to establish annual hiring 
benchmarks, expressed as the percentage of total hires who are 
protected veterans that the contractor seeks to hire in the following 
year. The hiring benchmarks were to be established by the contractor 
using existing data on veteran availability, while also allowing the 
contractor to take into account other factors unique to its 
establishment that would tend to affect the availability determination. 
OFCCP received a total of 38 comments on the proposed benchmarks. 
Twelve commenters questioned whether contractor established benchmarks 
would be arbitrary and ineffective because of concerns about the 
reliability of data on the number of protected veterans in the 
workforce. Commenters also sought clarity on exactly how they should 
develop benchmarks based on the varying sources of data available. In 
addition, commenters asserted that the benchmarks were quotas that 
would adversely impact women and minorities since demographically 
veterans are predominantly white males. In response to these concerns, 
OFCCP has revised Sec.  60-300.45 to provide a simpler, nationwide 
benchmark as another option that contractors can use, in addition to 
the flexible approach set forth in the NPRM. Further, the final rule 
addresses the incorrect assumptions--e.g., that goals represent a 
``quota'' or will place contractors in jeopardy of violating the sex 
discrimination provisions of Executive Order 11246--that many comments 
in the NPRM detailed.
    Finally, in response to some comments and to further reduce costs, 
the final rule eliminates a few other minor requirements included in 
the NPRM. For instance, the final rule does not include the proposed 
requirement in Sec.  60-300.42(d) of the NPRM that contractors 
affirmatively ask disabled veterans if they require a reasonable 
accommodation, retaining the requirement in the existing rule that 
contractors must take part in an interactive process regarding 
accommodation and should, but are not required to, seek the advice of 
the applicant regarding such accommodation. This aligns the rule with 
the obligations set forth in the Americans with Disabilities Act. 
Additionally, the final rule eliminates the specific obligation to 
inform off-site employees about the availability of the contractor's 
affirmative action plan, and instead retains the existing obligation 
that requires the affirmative action plan to be available upon request 
with the location and hours of availability posted publicly. As with 
the other changes discussed, these revisions maintain the general 
obligations while reducing the burden of compliance for contractors.
    The final rule presents the most substantial re-write of VEVRAA 
regulations since their inception. In light of these significant 
changes, and in response to contractors' requests to delay 
implementation due to these changes, the effective date of this final 
rule is set for 180 days after publication in the Federal Register. The 
detailed Section-by-Section Analysis below identifies and discusses all 
of the final changes in each section. For ease of reference, part 60-
300 will be republished in its entirety in the final rule.

Section-by-Section Analysis

41 CFR Part 60-250

Rescission of Part 60-250
    The NPRM proposed two alternative approaches to updating part 60-
250. The first approach proposed rescinding part 60-250 in its 
entirety. The second approach proposed revising part 60-250 so that it 
mirrors the proposed changes to part 60-300. OFCCP received 16 comments 
on these proposals from a variety of entities including individuals, 
law firms, contractors, and associations representing veterans, 
contractors, or individuals with disabilities.
    OFCCP received few comments supporting retaining part 60-250. One 
commenter stated that it held several contracts that are covered under 
parts 60-250 and 60-300. One individual commenter stated that part 60-
250 should remain in place as some major contractors have contracts 
spanning several decades that are still in force. The commenter also 
expressed concern about eliminating the definition of ``special 
disabled veteran.'' The commenter noted that 30 percent of disabled 
veterans may need additional affirmative action since it would be 
difficult to compete with a veteran that has no service connected 
disability.
    OFCCP received 14 comments that either recommended rescinding part 
60-250, indicated that the commenter was unaware of contractors that 
were subject to part 60-250, or stated that the commenter was neutral 
on the proposal to rescind part 60-250. Many commenters questioned 
whether there were any remaining active contracts that would still be 
covered by part 60-250. One commenter, an industry group, stated that 
one of its members has a continuing contract from the 1980s; however, 
that contract has since been modified and is no longer covered under 
part 60-250.
    Commenters provided alternative recommendations to implementing a 
part 60-250 that mirrors part 60-300. An equal employment opportunity 
consulting firm recommended allowing contractors to combine their 
obligations under both parts 60-250 and 60-300 into a single AAP to 
eliminate unnecessary duplication. Another

[[Page 58620]]

commenter recommended widening the scope of part 60-300 to incorporate 
contracts that are covered under part 60-250.
    Part 60-250 is rescinded. As stated in the NPRM and echoed by many 
commenters, we do not believe that there are any remaining contracts 
for $25,000 or more entered into prior to December 1, 2003, that have 
not either terminated or since been modified (which, if over $100,000 
in value, would fall under part 60-300's coverage). While the agency 
received one comment from a company that asserted that it held 
contracts that are subject to part 60-250, OFCCP's research revealed 
that the commenter is a grantee. However, out of an abundance of 
caution that any contracts falling under part 60-250's coverage still 
exist, and to ensure that all veterans that are protected by part 60-
250 (and not part 60-300 as well) will be able to pursue complaints of 
discrimination, the final rule includes a definition of ``pre-JVA 
veteran'' in Sec.  60-300.2, and provides that such individuals 
continue to be protected by the non-discrimination prohibitions in 
Sec.  60-300.21 and are able to file discrimination complaints pursuant 
to Sec.  60-300.61. There is further discussion of this definition in 
the analysis of Section 60-300.2.

41 CFR Part 60-300

Subpart A--Preliminary Matters, Equal Opportunity Clause
Section 60-300.1 Purpose, Applicability and Construction
    Section 60-300.1 of the current rule sets forth the scope of VEVRAA 
and the purpose of its implementing regulations. The NPRM proposed 
deleting references throughout the regulation to the ``Vietnam Era 
Veterans' Readjustment Assistance Act of 1974'' or ``VEVRAA'' and 
replacing it in this section and throughout the regulation with 
``Section 4212.'' OFCCP proposed the change due to concerns that the 
continued reference to ``Vietnam era veterans'' leads to confusion 
regarding the categories of veterans that are protected under the law. 
There were a total of six comments on the proposed revision.
    Some commenters supported referring to the regulations as ``Section 
4212.'' One commenter stated that the change would be an important and 
positive step to clarifying the fact that the regulations are no longer 
focused on issues that only concern veterans of the Vietnam era. 
Another commenter believed that the proposed change would eliminate 
confusion entirely regarding whether VEVRAA applied to only Vietnam era 
veterans. One commenter opposed the revision and argued that deleting 
the reference to ``VEVRAA'' would be an insult to Vietnam era veterans. 
Commenters also provided several recommendations for this section. One 
commenter suggested that if the agency is going to use the term 
``Section 4212,'' it should do so consistently. The commenter cited 
several examples where ``Section 4212'' was used inconsistently in the 
NPRM. Other commenters suggested that the agency utilize a name that 
connects ``Section 4212'' to the veterans who are protected, such as 
``Section 4212/Protected Veterans.'' The commenter that opposed the 
revision stated that OFCCP should invest resources into properly 
advertising the law rather than changing the name.
    The final rule does not incorporate the proposal to use the term 
``Section 4212,'' and instead continues the use of the term ``VEVRAA.'' 
While referring to the law as ``Section 4212'' had potential benefits 
as described in the NPRM, there was also concern that the new term 
``Section 4212'' might invite further confusion. For instance, for 
those unfamiliar with the law, the term ``Section 4212'' does not 
indicate any relationship to veterans' rights on its face. Further, 
there was concern that some may think that ``Section 4212'' and 
``VEVRAA'' were two unrelated laws. Accordingly, the final rule retains 
the term ``VEVRAA,'' and in response to comments we have ensured that 
the term is used consistently throughout the regulation.
    In addition, to address confusion among contractors and veterans 
regarding the scope of the various veterans' employment rights 
statutes, the final rule adds language to the discussion in paragraph 
(c)(2) of VEVRAA's ``relationship to other laws.'' New paragraph 
(c)(2)(i) highlights that VEVRAA and the Uniformed Services Employment 
and Reemployment Rights Act (USERRA) are separate laws with distinct 
obligations for contractors and distinct protections for employees who 
have past, present or future military service, status or obligations. 
It clarifies that this part does not limit the contractor's 
obligations, responsibilities, and requirements under USERRA, including 
the obligation to reemploy employees returning from qualifying military 
service, and emphasizes that compliance with this part is not 
determinative of compliance with USERRA.
Section 60-300.2 Definitions
    The NPRM proposed clarifying several key definitions in part 60-
300. The current classifications of protected veterans under VEVRAA 
include: (1) Disabled veterans, (2) veterans who served on active duty 
in the Armed Forces during a war or in a campaign or expedition for 
which a campaign badge was authorized, (3) veterans who, while serving 
on active duty in the Armed Forces, participated in a United States 
military operation for which an Armed Forces service medal was awarded 
pursuant to Executive Order No. 12985, and (4) recently separated 
veterans. The regulations define ``disabled veteran,'' ``recently 
separated veteran,'' and ``Armed Forces service medal veteran.'' The 
definition of ``other protected veteran'' in the existing regulation 
applies to veterans who served on active duty in the Armed Forces 
during a war or in a campaign or expedition for which a campaign badge 
has been authorized. OFCCP proposed replacing ``other protected 
veteran'' with ``active duty wartime or campaign badge veteran'' to 
eliminate confusion regarding the veterans that are protected under 
this category. Some have interpreted erroneously the ``other protected 
veteran'' category as a ``catch-all'' that includes all veterans. The 
proposed rule also added new definitions for ``protected veteran'' and 
``linkage agreement.'' OFCCP received a total of 18 comments on the 
proposed changes to Sec.  60-300.2 from a variety of entities including 
individuals, law firms, contractors, and associations representing 
veterans, contractors, or disability rights.
     Definition for ``Active Duty Wartime or Campaign Badge 
Veteran''
    There were a total of eight comments on the proposal to change the 
category of veterans referred to as ``other protected veteran'' in the 
existing rule to ``active duty wartime or campaign badge veteran.'' 
This category of veteran includes all those who served on active duty 
in the U.S. military, ground, naval, or air service either: (a) during 
a war; or (b) in a campaign or expedition for which a campaign badge 
was authorized by the Department of Defense (DOD). The proposal did not 
change which veterans are covered; we made the change so that the 
category name was more accurately descriptive of who it covered.
    Most commenters supported the proposal. One commenter noted that 
the proposed language would more accurately reflect the language in the 
statute and alleviate some of the past confusion surrounding the 
wording. Another commenter stated that the proposed change is helpful 
in understanding the nature of veterans protected by this category.

[[Page 58621]]

    A few commenters expressed concern about the proposed definition. 
One commenter argued that the law is quite clear on who is protected by 
VEVRAA and that the proposed term ``active duty wartime or campaign 
badge veteran'' does not provide any additional clarification. A human 
resources consulting company suggested that using ``active duty'' may 
lead to under-reporting. The company asserted that individuals may 
interpret this to mean that they have to be on active duty to qualify. 
Commenters also stated that it is unclear who qualifies as a 
``wartime'' or ``campaign badge veteran.'' One commenter noted that the 
clearest guidance on who qualifies as a ``campaign badge veteran'' 
could only be found on the United States Department of Defense and 
Office of Personnel Management Web sites. The commenter further stated 
that many contractors do not want to directly reference the information 
on those sites because they are related to the Federal government's 
veterans' preference. The commenter requested that OFCCP develop 
guidance specifically for contractors clearly identifying which 
veterans are protected under the ``wartime'' or ``campaign badge 
veteran'' classification.
    The final rule adopts the definition ``active duty wartime or 
campaign badge veteran'' as proposed in the NPRM. OFCCP believes that 
this is a more accurate description, and less subject to confusion, 
than the general ``other protected veteran'' classification. OFCCP 
notes that the Department of Defense and the individual services of the 
Armed Forces (e.g., Army; Navy) administer these campaign badges, and 
thus contractors should consult with DOD or the issuing military 
service if they have questions about whether a particular badge is a 
campaign badge that provides coverage under VEVRAA.
     Definition for ``Protected Veterans,'' ``Pre-JVA 
Veterans''
    While commenters were generally supportive of the proposal to 
create a definition for ``protected veteran,'' there were a few 
concerns regarding using the term ``protected'' to label the 
definition. One commenter argued that using the term ``protected 
veteran'' may cause further confusion since many mistakenly interpreted 
``other protected veteran'' to mean all other veterans not protected 
under the other defined categories. Another commenter argued that the 
definition should utilize the label ``protected veteran,'' since this 
is the statutory language in VEVRAA.
    The final rule retains the proposed definition for ``protected 
veteran.'' As this final rule eliminates the ``other protected 
veteran'' definition and replaces it with a clearer, more specific 
alternative, we believe that the new ``protected veteran'' term will 
not be confused with the previous ``other protected veteran'' term. 
Further, while we understand that the VEVRAA statute uses the term 
``protected veterans'' to describe the various categories of veterans 
protected by VEVRAA, we use the term ``protected veteran'' in the 
regulations for consistency with other regulations administered by 
OFCCP. The Executive Order 11246 and section 503 regulations, as well 
as the VEVRAA regulations to date, have used the term ``protected'' to 
refer to the individuals and groups of individuals who have rights 
under the various statutes (e.g., ``protected classes''). Meanwhile, 
the term ``covered'' has typically referred to the contractors to whom 
the regulations apply (e.g., ``covered contractor''). Therefore, in 
order to maintain word usage continuity with all of OFCCP's laws, we 
retain the term ``protected veteran'' as proposed in the NPRM.
    One commenter suggested that OFCCP expand the types of veterans 
protected under VEVRAA to include Desert Storm-era veterans, veterans 
that served in a war zone and veterans who utilize service dogs. The 
categories of ``protected veterans'' are not set by OFCCP, but rather 
are defined by the VEVRAA statute codified at 38 U.S.C. 4212(a)(3). 
OFCCP cannot expand the categories beyond those set forth in the 
statute. We note that most of the types of veterans listed above are 
protected by the categories of veterans set forth in the statute. 
Veterans that served in the Desert Storm-era or otherwise in a war zone 
likely will be protected under the ``active duty wartime or campaign 
badge veteran'' category of protected veteran, and possibly the 
``recently separated veteran'' category as well. As for veterans who 
use service dogs, if they were discharged or released from active duty 
due to a service-connected disability, or are otherwise entitled to 
compensation for disability under laws administered by the Department 
of Veterans Affairs, they would already be protected under the 
``disabled veteran'' classification.
    Finally, as noted in the discussion on the rescission of part 60-
250, the final rule also includes a definition for ``pre-JVA veteran,'' 
which incorporates those individuals who were previously protected 
under part 60-250 into part 60-300. The definition is as follows:
    ``Pre-JVA veteran means an individual who is an employee of or 
applicant to a contractor with a contract of $25,000 or more entered 
into prior to December 1, 2003, and who is a special disabled veteran, 
veteran of the Vietnam era, pre-JVA recently separated veteran, or 
other protected veteran, as defined below:
    (1) Special disabled veteran (also referred to in this regulation 
as `Pre-JVA special disabled veteran') means:
    (i) a veteran who is entitled to compensation (or who but for the 
receipt of military retired pay would be entitled to compensation) 
under laws administered by the Department of Veterans Affairs for a 
disability:
    (A) Rated at 30 percent or more; or
    (B) Rated at 10 or 20 percent in the case of a veteran who has been 
determined under 38 U.S.C. 3106 to have a serious employment handicap; 
or
    (ii) A person who was discharged or released from active duty 
because of a service-connected disability.
    (2) Veteran of the Vietnam era means a person who:
    (i) Served on active duty for a period of more than 180 days, and 
was discharged or released there from with other than a dishonorable 
discharge, if any part of such active duty occurred:
    (A) In the Republic of Vietnam between February 28, 1961, and May 
7, 1975; or
    (B) Between August 5, 1964, and May 7, 1975, in all other cases; or
    (ii) Was discharged or released from active duty for a service-
connected disability if any part of such active duty was performed:
    (A) In the Republic of Vietnam between February 28, 1961, and May 
7, 1975; or
    (B) Between August 5, 1964, and May 7, 1975, in all other cases.
    (3) Pre-JVA recently separated veteran means a pre-JVA veteran 
during the one-year period beginning on the date of the pre-JVA 
veteran's discharge or release from active duty.
    (4) Other protected veteran means a person who served on active 
duty during a war or in a campaign or expedition for which a campaign 
badge has been authorized, under the laws administered by the 
Department of Defense.''
    As stated in the discussion of the rescission of part 60-250, 
references to ``Pre-JVA veteran'' are included in the discrimination 
prohibition section for the final rule (Sec.  60-300.21) and the 
complaint procedures section of the final rule (Sec.  60-300.61) to 
ensure that, if there are any individuals remaining who are protected 
solely by part 60-250, such individuals will be able to avail 
themselves of their rights and file complaints for discrimination based 
on their veteran status just as ``protected veterans'' under part 60-
300 are able to do. We do not include ``pre-JVA veterans'' along with 
``protected

[[Page 58622]]

veterans'' in the sections of the regulation pertaining to contractors' 
affirmative action obligations. As we have noted above, we have no 
evidence that there are any contracts remaining that fall solely under 
part 60-250's coverage, and thus requiring contractors to engage in 
affirmative action efforts pursuant to contracts that by all accounts 
no longer exist is not a good use of resources. Regardless, the 
protected veteran categories under part 60-300 include the vast 
majority of veterans who were protected under the part 60-250 
categories--indeed, the part 60-300 categories are even broader with 
regard to recently separated veterans and disabled veterans. To the 
extent they do not, many of contractors' affirmative action obligations 
under part 60-300 would likely reach such individuals anyway (e.g., a 
contractor's recruitment and outreach effort, which could include a 
linkage agreement with a local veterans service group).
     Definition for ``Linkage Agreements''
    Commenters expressed a variety of concerns regarding the proposed 
definition of ``linkage agreements.'' However, as the final rule 
eliminates the requirement for contractors to enter into linkage 
agreements--see discussion of Sec.  60-300.44(f), below--there is no 
need for the regulation to contain a definition for it, and thus it is 
eliminated from the final rule.
     Additional Definitions
    Commenters recommended adding certain definitions to Sec.  60-300.2 
for clarification purposes. Two commenters stated that OFCCP needed to 
clearly define ``priority referral.'' One of the commenters, a law 
firm, expressed concern that contractors are specifically directed to 
request ``priority referrals'' and conduct analyses of ``priority 
referrals'' in comparison to other referrals, but the regulations do 
not clearly define ``priority referral.'' Another commenter requested 
that OFCCP define ``external job search organizations'' because the 
term has been broadly interpreted to encompass a broad range of 
organizations including online job search engines, veterans' service 
organizations, and other third parties that provide candidates for 
contractors.
    OFCCP declines to include a definition of ``priority referral'' in 
Sec.  60-300.2. OFCCP believes that it is clear from the statute that 
the term refers to individuals referred pursuant to a local employment 
services office's requirement to give ``veterans priority in referral'' 
for contractor employment listings. See 38 U.S.C. 4212(a)(2). Further, 
the requirement that the One-Stop service delivery systems provide 
priority referral of veterans is not administered and carried out by 
OFCCP, but by other agencies within the Department. The Department's 
Employment and Training Administration (ETA) and Veterans' Employment 
and Training Service (VETS) have published guidance on implementing 
priority of service requirements for veterans, including: the Training 
and Employment Guidance Letter 10-09 (accessible on ETA's Web site at 
http://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=2816); Veterans' 
Program Letter 07-09; and Training and Employment Notice 15-10, ``A 
Protocol for Implementing Priority of Service for Veterans and Eligible 
Spouses.'' However, we note that the final rule eliminates the proposed 
requirement to collect and maintain data on priority referrals, which 
should limit any concerns raised in response to the NPRM about how to 
specifically categorize priority referrals.
    OFCCP also disagrees with the assertion that the agency should 
define ``external job search organization.'' The NPRM noted in the 
discussion of the proposed Paragraph 4 of the EO Clause that if a 
``contractor uses any outside job search companies (such as a temporary 
employment agency) to assist in its hiring, the contractor must provide 
the state employment service with the contact information for these 
outside job search companies.'' This context clarifies the kinds of 
organizations that are considered ``external job search 
organizations.'' OFCCP intends for ``external job search organization'' 
to be read as broadly as possible. ``External job search organization'' 
includes any entity not wholly owned and operated by the contractor 
that assists with its hiring.
    Finally, the final rule appends additional language to the 
definition for ``employment service delivery system'' (ESDS). The 
existing rule references that the ESDS offers services in accordance 
with the Wagner-Peyser Act. The final rule adds some additional 
background and explanation of the Wagner-Peyser Act, stating that 
``[t]he Wagner-Peyser Act requires that these services be provided as 
part of the One-Stop delivery system established by the States under 
Section 134 of the Workforce Investment Act of 1998.'' The Wagner-
Peyser Act of 1933 established a national network of Employment Service 
offices that provided labor exchange services to jobseekers and 
employers. The Workforce Investment Act of 1998 (WIA) amended the 
Wagner-Peyser Act and required states and localities to integrate 
employment and training programs into a single public workforce system. 
Thus, employment services and training programs are all provided 
through a national network of One-Stop Career Centers established in 
the local workforce investment areas of the states. The description of 
the Employment Service's role in the public workforce system can be 
found at 20 CFR 652.202, and Section 7(e) of the Wagner-Peyser Act.
    We also note that several commenters representing the contractor 
community requested that OFCCP add formal definitions for ``applicant'' 
and for ``Internet applicant,'' as those terms are defined in the 
Executive Order 11246 (EO 11246) implementing regulations at 41 CFR 
part 60-1. While OFCCP does not formally adopt the definition of 
``Internet applicant'' into the section VEVRAA regulations, OFCCP is 
harmonizing the requirements of these regulations and the EO 11246 
Internet Applicant Rule. OFCCP provides further guidance on this issue 
in the preamble discussion related to Sec.  60-300.42.
Section 60-300.5 Equal Opportunity Clause
    The NPRM proposed several changes to the content of the Equal 
Opportunity Clause found in Sec.  60-300.5, and the manner in which the 
Clause is included in Federal contracts. These proposals, the comments 
to these proposals, and the revisions made to the final rule are 
discussed in turn below.
     EO Clause Paragraph 2--Clarification of Mandatory Job 
Listing Obligations
    The NPRM proposed additional language to this paragraph clarifying 
that the contractor must provide job vacancy information to the 
appropriate employment service in the manner that the local employment 
service delivery system (ESDS) requires in order to include the job in 
their database so that they may provide priority referral of veterans. 
The NPRM also proposed additional language to this paragraph clarifying 
that, for any contractor who utilizes a privately-run job service or 
exchange to comply with its mandatory listing obligation, the 
information must be provided to the appropriate employment service in 
the manner that the employment service requires. OFCCP received 14 
comments concerning this section from an individual, law firms, 
contractors, contractor groups, a veteran's group, and others. As 
explained below, we adopt the language proposed in the NPRM for this 
paragraph with one minor revision.
    The majority of the comments received asserted that posting jobs in 
the

[[Page 58623]]

format required by a given ESDS was burdensome, as ESDSs in varying 
states and localities require different submission formats and 
information for their job listing system. On a related note, several 
commenters suggested that the Department reinstitute America's Job 
Bank, a nationwide job listing service operated and eventually 
eliminated several years ago by the Employment and Training 
Administration. OFCCP did not develop or maintain America's Job Bank, 
as one law firm commenter asserted.
    A bit of historical background is perhaps helpful in addressing 
these comments. As was discussed in the NPRM, the requirement to list 
jobs with the appropriate ESDS is not a purely regulatory creation, but 
is established in the statute itself. See 38 U.S.C. 4212(a)(2)(A). The 
statute has long required that each contractor ``shall immediately list 
all of its employment openings with the appropriate employment service 
delivery system.'' Id. The JVA, in amending VEVRAA in 2002, further 
specified that while contractors could also list a job with America's 
Job Bank or any additional or subsequent national electronic job bank 
established by the Department of Labor, this was not in and of itself 
sufficient to satisfy the job listing requirement. Id. at 
4212(a)(2)(A). Accordingly, reinstitution of America's Job Bank or 
something similar would not change the statutory requirement that 
contractors list their jobs with the appropriate ESDS. OFCCP is 
obligated to comply with the statute as written.
    Thus, the mandatory job listing requirement set forth in the NPRM 
is not a new creation; it merely clarified that contractors list their 
jobs with the ESDS ``in the manner and format required'' by the ESDS. 
This, for example, could include requiring electronic transmission 
through a web-based form or electronic document format (such as PDF), 
requiring paper transmission using mail or facsimile, or requiring the 
contractor to provide particular types of information in its 
submissions. As we stated in the NPRM, this clarification stems from 
numerous reports received by OFCCP that contractors were occasionally 
providing job listing information to the ESDS in an unusable format, 
such that their jobs were not being listed and the ESDS could not 
properly carry out the priority referral of veterans, which is required 
by VEVRAA and its regulations. We received input during the public 
comment period from individuals working for or with an ESDS that 
corroborated these reports. If the purpose of the mandatory job listing 
requirement is to help veterans find work with Federal contractors, 
then surely Congress did not intend to permit contractors to provide 
information about their job openings in an unusable format, completely 
defeating the purpose of the requirement. Some commenters were 
concerned that the proposed language in the NPRM required contractors 
to provide information about their job openings in one specific format 
mandated by the ESDS. This was not the intention of the proposal. 
Rather, the aim of the proposal was simply to ensure that contractors 
provide information about their job openings with the ESDS in a format 
that the ESDS can use to provide priority referrals of protected 
veterans to contractors. If an ESDS permits the contractor to provide 
this information in various formats, the contractor would be free to 
use any one of them. To clarify this requirement, the final rule 
revises the proposal's language (providing the listing ``in the manner 
or format required by the appropriate [ESDS] . . .'') to require 
contractors to list their jobs ``in a manner and format permitted by 
the appropriate [ESDS] which will allow that system to provide priority 
referral of veterans. . .''
    Finally, a few commenters questioned whether the language proposed 
in the NPRM for the last sentence of this paragraph, which clarifies 
that any contractor using a privately-run job service or exchange to 
list its jobs is still required to have the job listed with the 
appropriate ESDS in a usable format, would forbid third parties from 
posting jobs for contractors or the use of private job boards. The 
language in the NPRM, now adopted into the final rule, does not prevent 
a contractor from utilizing a third party to list its jobs, so long as 
the job listing is submitted to the appropriate ESDS in any manner and 
format permitted by the ESDS. However, if the job is not listed by the 
third party with the appropriate ESDS in a permitted manner and format, 
the contractor will be held responsible. Similarly, the language in the 
NPRM, now adopted into the final rule, does not prevent a contractor 
from listing its jobs on any privately-run job boards it may deem 
worthwhile; however, it may only do so in addition to, and not instead 
of, the mandatory job listing requirement established by statute and 
set forth in the rule.
     EO Clause Paragraph 4--Information Provided to State 
Employment Services
    The NPRM proposed that the contractor, when it becomes obligated to 
list its job openings with the appropriate state employment service, 
must provide additional information, including its status as a Federal 
contractor, the contact information for the contractor hiring official 
at each location in the state, and its request for priority referrals 
of protected veterans for job openings at all its locations within the 
state, and that this information must be updated annually. These 
requirements were added in response to feedback received from ESDSs 
that there is no centralized list of Federal contractors that they can 
consult in order to determine if a listing employer is a Federal 
contractor, and to ensure that these ESDSs have contact information for 
the listing contractor if there are any questions that need to be 
resolved in the job listing or priority referral process. The NPRM also 
required that the contractor provide the ESDS with the contact 
information for any outside job search companies (such as a temporary 
employment agency) assisting with its hiring process.
    OFCCP received four comments specific to these proposed changes. 
One commenter stated that GSA has a list of Federal contractors and, 
therefore, the Federal Government should make this list available to 
the ESDS and not require listing companies to indicate whether or not 
they are a Federal contractor as defined by the VEVRAA regulations. 
While it is true that the GSA e-library Web site has a list of 
contractors, this list does not contain companies that have contracts 
with all agencies throughout the Federal Government, and in fact did 
not include certain contractors that OFCCP has investigated in recent 
years and for whom coverage is not disputed. Additionally, the library 
is not limited to those contracts entered into on or after December 1, 
2003 with a value of $100,000 or more, the criteria for coverage under 
part 60-300 of the regulations. As such, this list is both under-
inclusive and over-inclusive, and cannot be relied upon for VEVRAA 
enforcement purposes. In this context, and in the interest of insuring 
that Federal contractors are properly identified so an ESDS can fulfill 
its duty to give priority referral of protected veterans to 
contractors, we believe that requiring contractors to simply indicate 
``VEVRAA Federal Contractor'' on its job listings facilitates the 
business engagement efforts of the ESDS and is not unduly burdensome 
for either the contractor or the ESDS (this revision does not add any 
additional reporting requirements for the ESDS aside from those already 
set forth in the VEVRAA and these regulations). Accordingly, the final 
rule incorporates this proposal.

[[Page 58624]]

    Some commenters stated that posting the contact information for 
``the contractor official responsible for hiring at each location'' 
would be burdensome on that person, especially if recruiting 
nationwide, and might be confusing, as multiple persons could be 
involved in hiring. Among the alternative suggestions in the comments 
was using ``chief hiring official,'' ``HR contact,'' or ``senior 
management contact'' in the place of ``contractor official responsible 
for hiring at each location.''
    As stated in the NPRM, the reason for requiring this information 
was to ensure that the ESDS had the contact information for someone 
working for the contractor that could answer any questions the ESDS may 
have about the listing to ensure it is processed appropriately and was 
the proper recipient of priority referrals of veterans. In order to 
make this requirement less vague and to provide contractors with 
greater flexibility, the final rule includes a sentence providing 
further guidance that the ``contractor official'' may be a chief hiring 
official, a Human Resources contact, a senior management contact, or 
any other manager for the contractor that can verify the information 
set forth in the job listing. Additionally, the final rule makes a 
small change to the reporting schedule for the information required by 
this paragraph. While the NPRM required that this information be 
reported annually, the final rule requires that contractors provide 
this information at the time of its first job listing, and then update 
it for subsequent job listings only if any of the provided information 
has changed. This will ensure that the ESDS has the information it 
needs while potentially limiting the reporting burden on contractors.
    The NPRM also required that the contractor provide the ESDS with 
the contact information for any outside job search companies (such as a 
temporary employment agency) assisting with its hiring process, and 
replaced the term ``state workforce agency'' and ``state agency'' 
throughout the regulation with the term ``employment service delivery 
system,'' which was already a defined term in the regulation. We did 
not receive any comments specific to these proposals, and thus they are 
adopted in the final rule as proposed.
     EO Clause Paragraph 5--Maintaining Referral Data
    The NPRM proposed an entirely new paragraph 5 to the EO Clause that 
would require contractors to collect and maintain data on the number of 
referrals and priority referrals they receive, in order to give the 
contractor and OFCCP a quantifiable measure of the availability of 
protected veterans and, therefore, provide part of a baseline for 
measuring the success of a contractor's outreach and recruitment 
programs. The NPRM also proposed that contractors maintain this data 
for five years, in order to ensure that contractors had enough 
historical referral data to consider when evaluating its outreach 
efforts (see Sec.  60-300.44(f)(3)) and establishing benchmarks (see 
Sec.  60-300.45).
    OFCCP received several comments on this proposal, the majority of 
which stated that the data collection and five-year recordkeeping 
requirements were unduly burdensome. Other commenters believed that it 
would be difficult and perhaps impossible to obtain accurate referral 
data, and thus the practical utility of the data collection requirement 
was limited. For instance, one commenter asserted that accurate 
referral data would be difficult to obtain if an applicant filed 
directly with a contractor, and that referral data from private Web 
sites would not be counted as referral. Several commenters representing 
the contractor community also asserted that requiring contractors to 
collect and maintain this data was inconsistent with the Internet 
Applicant rule set forth in the Executive Order 11246 regulations.
    OFCCP has considered these comments and believes that the points 
raised by commenters regarding the practical utility of the referral 
data, in light of the burden of collecting it, have merit. Accordingly, 
the final rule deletes the proposed paragraph 5 and renumbers the 
subsequent paragraphs in the EO Clause accordingly.
     EO Clause Paragraph 10 (NPRM)/Paragraph 9 (Final Rule)--
Providing Notice to People with Disabilities
    In paragraph 10 of the EO Clause in the NPRM, we proposed two 
changes. First, we updated the contractor's duty to provide notices of 
rights and obligations that are accessible to individuals with 
disabilities, replacing the outdated suggestion of ``hav[ing] the 
notice read to a visually disabled individual'' as an accommodation 
with the suggestion to provide Braille, large print, or other versions 
that allow persons with disabilities to read the notice themselves. 
OFCCP received one comment from a contractor asserting that there were 
``too many'' types of notices possible for all types of disabilities. 
We respectfully disagree with this commenter's assertion. The context 
of the existing regulation and the proposed changes clearly and 
specifically refer to providing an alternative notice to individuals 
who are unable to read it due to visual impairment or visual 
inaccessibility (such as an individual who uses a wheelchair being 
unable to read the fine print of a notice posted high on a wall). The 
commenter did not specify any other disabilities for which contractors 
would need to create alternative notices, and we cannot conceive of any 
that would create any significant burden. Further, any burden in 
providing a notice in Braille is slight given the fact that they are 
available from the EEOC's Office of Communications and Legislative 
Affairs, who may be contacted at 202-663-4191 or TTY 202-663-4494. See 
http://www1.eeoc.gov/eeoc/publications/. We have amended the language 
slightly in the final rule to clarify that among the ``other versions'' 
of the notice there are additional technological options available to 
contractors that would fulfill the requirement, such as providing it 
electronically or on computer disc.
    Second, we proposed additional language detailing that a contractor 
can satisfy its posting obligations through electronic means for 
employees who use telework arrangements or otherwise do not work at the 
physical location of the contractor, provided that the contractor 
provides computers to its employees or otherwise has actual knowledge 
that employees can access the notice. The addition of this language is 
in response to several things: the increased use of telecommuting and 
other work arrangements that do not include a physical office setting; 
internet-based application processes in which applicants never enter a 
contractor's physical office; and a number of complaints received by 
OFCCP in recent years from individuals employed by contractors without 
a constant physical workplace--such as airline pilots--who assert that 
they were unaware of their rights under VEVRAA. OFCCP received two 
comments on this proposal, one from a law firm and one from a 
contractor, raising two separate issues.
    The first issue raised by one of these comments was that ``actual 
knowledge'' of an off-site employee being able to access the notice is 
unduly burdensome. We respectfully disagree. First, to clarify, 
``actual knowledge'' does not mean actual knowledge that the employee 
accessed the notice, but rather actual knowledge that the notice was 
posted or disseminated in such a way that would be accessible to the 
employee. As set forth in the proposed language, for a contractor with 
employees who do not work at a physical location of the contractor, 
electronic notices that are posted in a conspicuous location and format 
on the company's intranet or sent by electronic

[[Page 58625]]

mail to employees satisfies the posting obligations. In the example of 
electronic mail, ``actual knowledge'' could easily be documented merely 
by maintaining an electronic copy of the email message sent to 
employees--something that is done (or can be done) automatically by 
virtually all enterprise-based email systems. Similarly, ``actual 
knowledge'' for postings on a company intranet can be verified simply 
by having an employee in personnel or IT periodically check the link to 
the electronic posting to ensure that it works and the posting is 
readable. Performing these types of checks on information posted on a 
company intranet is a common best practice that takes seconds to 
complete. In light of the numerous comments and complaints OFCCP has 
received from protected veteran employees of Federal contractors--
particularly those without a traditional physical workplace--that they 
were unaware of their rights or their contractor's affirmative action 
obligations, we believe the importance of ensuring that employees have 
access to statements of their rights and the contractor's obligations 
far outweighs the slight burden that compliance creates.
    The second issue raised in the comments pertained to the 
requirement that, for contractors using electronic or internet-based 
application processes, an electronic notice of employee rights and 
contractor obligations must be ``conspicuously stored with, or as part 
of, the electronic application.'' One commenter opined that storing the 
electronic notice with the application would increase the size of 
applicant files. The potentially small increase in the size of the 
electronic file does not outweigh the benefit of providing employees 
notice of their employment rights and protections.
    Accordingly, for the reasons stated above, OFCCP has adopted the 
proposed changes to paragraph 10 of the EO Clause into paragraph 9 of 
the final rule. We have also added a clarification stating that a 
contractor is able to satisfy its posting obligation by electronic 
means for employees who do not work at a physical location of the 
contractor, provided that the contractor provides computers ``or access 
to computers'' that can access the electronically posted notices. This 
clarifies that electronic posting is appropriate not only for employees 
who telework, but also for those who share work space--and contractor-
provided computers--at a remote work center.
     EO Clause Paragraph 11 (NPRM)/Paragraph 10 (Final Rule)--
Providing Notice to Labor Organizations
    The NPRM proposed additional language that a contractor, in 
addition to its existing obligation to notify labor organizations with 
which it has collective bargaining agreements about its affirmative 
action efforts, must also notify the labor organizations about its non-
discrimination obligations as well. There were no comments specific to 
this minor change, and thus the language in paragraph 11 of the NPRM is 
adopted as paragraph 10 of the final rule as proposed.
     EO Clause Paragraph 13 (NPRM)/Paragraph 12 (Final Rule)--
Contractor Solicitations and Advertisements
    The proposed regulation added a new paragraph 13 to the EO clause 
which would require the contractor to state and thereby affirm in 
solicitations and advertisements that it is an equal employment 
opportunity employer of veterans protected by VEVRAA, much like it is 
already required to do under the Executive Order 11246 regulations.
    OFCCP received one comment from a contractor group, objecting to 
this proposal on the grounds that advertisements would cost more due to 
their increased word length. However, as stated in the NPRM, 
contractors are already required under Executive Order 11246 to state 
in advertisements and solicitations that ``all qualified applicants 
will receive consideration for employment without regard to race, 
color, religion, sex, or national origin.'' See 41 CFR 60-1.4(a)(2). 
The requirement set forth in paragraph 13 of the NPRM would require 
adding ``protected veteran status,'' or an abbreviation thereof, to the 
language that contractors are already required to use in 
advertisements. This is a very minor change involving nominal time and 
expense to contractors that will affirm to the public a fact that many 
do not know--that protected veterans are entitled to non-discrimination 
and affirmative action in the workplace of Federal contractors. 
Accordingly, the language in paragraph 13 of the NPRM is adopted as 
paragraph 12 of the final rule as proposed.
     Inclusion of EO Clause in Federal Contracts (proposed 
Sec. Sec.  60-300.5(d) and (e))
    Finally, the NPRM proposed requiring that the entire equal 
opportunity clause be included verbatim in Federal contracts. This 
proposed change was to ensure that the contractor, and particularly any 
subcontractor, who often relies on the prime contractor to inform it of 
nondiscrimination and affirmative action obligations, reads and 
understands the language in this clause. OFCCP received four comments--
from two law firms, a contractor, and a contractor group--all of whom 
opposed this proposed new requirement. These commenters asserted that 
the requirement to incorporate the EO Clause into Federal contracts was 
too burdensome, as the length of a contract would increase greatly in 
size to perhaps double or triple its original length. The commenters 
further opined that the increase in the length would cause contracts to 
be rewritten, and that the increase in paper that would accompany such 
a requirement was not environmentally friendly. Finally, the commenters 
asserted that cutting and pasting the text of the clause into the text 
of contracts was not a simple task, and would require time to reformat 
and otherwise edit the contract prior to signing it.
    In light of the comments and upon further consideration of the 
issue, OFCCP withdraws and revises the proposal to incorporate the 
entire EO Clause into Federal contracts. In addition to the burden 
concerns set forth by commenters, there is concern that the length of 
the EO Clause will dissuade, rather than promote, contractors and 
subcontractors from reading and taking note of the non-discrimination 
and affirmative action obligations toward protected veterans. This is 
contrary to the intent behind the proposal in the NPRM.
    However, the requirement in the existing regulations does little to 
notify contractors and subcontractors of the nature of their 
obligations to employ and advance in employment protected veterans, 
which was a primary objective of the NPRM proposal. Accordingly, in 
order to draw greater attention to the contractors' obligations under 
VEVRAA without the burden of including the entire VEVRAA EO clause, the 
final rule revises paragraph (d) of this section to require the 
following text, set in bold text, in each contract, following the 
reference to VEVRAA required by the FAR:

    ``This contractor and subcontractor shall abide by the 
requirements of 41 CFR 60-300.5(a). This regulation prohibits 
discrimination against qualified protected veterans, and requires 
affirmative action by covered prime contractors and subcontractors 
to employ and advance in employment qualified protected veterans.''

    This requirement would apply to all contracts entered into after 
the effective date of the rule.
    Lastly, the final rule does not incorporate the proposed change to 
paragraph (e), and instead reverts to the existing language in that 
subsection. The NPRM proposed eliminating the last clause of the 
paragraph (``whether or not it is physically incorporated in

[[Page 58626]]

such contract and whether or not there is a written contract between 
the agency and the contractor'') to align with the proposed paragraph 
(d), which required incorporation of the entire EO Clause into Federal 
contracts. Because paragraph (d) of the final rule does not include 
this requirement, the final rule revises paragraph (e) accordingly back 
to its existing form.
Subpart B--Discrimination Prohibited
Section 60-300.21 Prohibitions
    The proposed rule included clarifying language to paragraph (f)(3) 
of this section, qualifying that an individual who rejects a reasonable 
accommodation made by the contractor may still be considered a 
qualified disabled veteran if the individual subsequently provides or 
pays for a reasonable accommodation. One law firm commenter stated that 
the proposal to allow individuals to provide their own accommodations 
could lead to legal, safety, and equal treatment issues.
    OFCCP opts to retain the proposed language in the final rule. 
First, this proposal is not ``wholly inconsistent'' with the ADA like 
the commenter suggested. Rather, it is entirely consistent with 
longstanding EEOC ADA reasonable accommodation policies. See, e.g., 
EEOC's ``Enforcement Guidance on Reasonable Accommodation and Undue 
Hardship Under the Americans with Disabilities Act,'' October 17, 2002 
(``to the extent that a portion of the cost of an accommodation causes 
undue hardship, the employer should ask the individual with a 
disability if s/he will pay the difference.'') We likewise do not 
believe that safety concerns warrant a change in the regulation, as the 
provisions on ``direct threat'' in this regulation and any contractors' 
general workplace safety policies will guard against these concerns. 
Nor would a contractor have to permit a disabled veteran to provide an 
accommodation if the contractor can show that that accommodation would 
significantly disrupt the workplace or otherwise impose an undue 
hardship on its operations.
    Finally, as set forth in the discussion of the new ``pre-JVA 
veteran'' definition in Sec.  300.2, the final rule adds ``or pre-JVA 
veteran'' after each instance of ``protected veteran'' in this section, 
and adds ``or pre-JVA special disabled veteran'' after each instance of 
``disabled veteran'' in this section. This incorporates the categories 
of veterans protected by the now rescinded part 60-250 into this part, 
ensuring that pre-JVA veterans, if any still exist, are protected by 
the anti-discrimination provisions of this section.
Subpart C--Affirmative Action Program
Section 60-300.40 Applicability of the affirmative action program 
requirement
    The NPRM proposed one small change to paragraph (c) of this 
section, specifying that a contractor's affirmative action program 
shall be reviewed and updated annually ``by the official designated by 
the contractor pursuant to Sec.  60-300.44(i).'' We received no 
comments on this section. Accordingly, Sec.  60-300.40 is adopted in 
the final rule as proposed.
Section 60-300.41 Availability of affirmative action program
    The proposed regulation added a sentence requiring that, in 
instances where the contractor has employees who do not work at the 
contractor's physical establishment, the contractor shall inform these 
employees about the availability of the affirmative action program by 
means other than a posting at its establishment, in light of the 
increased use of telecommuting and other flexible workplace 
arrangements. This proposal in many respects mirrored the electronic 
notice requirements set forth in paragraph 10 of the EO Clause at Sec.  
60-300.5 of the rule. OFCCP received 6 comments from an individual, two 
law firms, two contractors and a contractor association regarding the 
proposed revisions to this section, discussed in turn below.
    The comments from the two law firms assert that the proposed 
changes regarding data collection and analysis in Sec. Sec.  60-
300.44(f) and 60-300.44(k) change the character of the VEVRAA AAP by 
including potentially confidential information and should warrant 
excluding ``data metrics'' contained in the AAP when the AAP is 
accessible by applicants and employees. One of these comments indicated 
that even if data is aggregated, it may still identify an employee as a 
veteran violating confidentiality, e.g., one hire occurs for which the 
position is named and the individual is identified as a disabled 
veteran. Another comment similarly recommended that a ``soft'' copy of 
the AAP be made available to those requesting a copy. Finally, one 
comment noted that the AAP should simply be made available at the 
convenience of the requesting applicant and/or employee, which is 
essentially the function of the existing rule.
    In response to these comments, and as part of the effort to focus 
the final rule on those elements that are of critical importance to 
OFCCP and reduce burden on contractors where possible, the final rule 
does not incorporate the proposals in the NPRM regarding informing off-
site individuals about the availability of the contractor's affirmative 
action program. Rather, the final rule retains the language in the 
existing Sec.  60-300.41 in that regard. Therefore, contractors must 
still make available their affirmative action programs to employees and 
applicants for inspection upon request. We further clarify, in light of 
the modern workplace in which more and more workplaces house 
information electronically, that contractors may respond to requests by 
making their AAPs available electronically, so long as the requester is 
able to access the electronic version of the information. In response 
to the law firm commenters' concerns about confidentiality and the 
AAP's ``data metrics,'' OFCCP revises the language for the final rule 
to state that ``[t]he full affirmative action program, absent the data 
metrics required by Sec.  60-300.44(k), shall be made available to any 
employee or applicant . . .'' (revisions emphasized). This balances the 
interest in confidentiality of the contractor and its employees with 
the need for transparency regarding the contractor's affirmative action 
efforts.
Section 60-300.42 Invitation to self-identify
    The NPRM included three significant revisions to this section: (1) 
Requiring the contractor to invite all applicants to self-identify as a 
``protected veteran'' prior to the offer of employment without 
disclosing the particular category of veteran; (2) in addition to the 
new pre-offer inquiry, requiring a post-offer self-identification 
process to collect more refined data regarding the specific category or 
categories of protected veteran to which an applicant belongs; and (3) 
requiring, rather than suggesting, that the contractor seek the advice 
of the applicant regarding accommodation. OFCCP received 28 comments on 
this section, 9 of which were in support of the self-identification 
proposals in the NPRM. For those that opposed portions of the NPRM, 
most comments centered on the issues of burden, the possibility of 
inaccurate self-reporting, alleged conflict between the pre-offer 
inquiry and requirement to seek accommodation advice with State and 
Federal laws (most notably the ADA and the ADAAA), and interplay 
between the pre-offer data collection requirement and the Internet 
Applicant Rule set forth in the regulations for Executive Order 11246. 
The proposals and the comments to these proposals, and the revisions 
made to the final rule are discussed in

[[Page 58627]]

turn below (with the exception of some specific comments on burden, 
which are addressed in the Regulatory Procedures section of the final 
rule).
     Paragraph (a): Pre-offer invitation to self-identify
    As discussed in the NPRM, the primary reason for proposing a pre-
offer invitation to self-identify was to allow the contractor, and 
subsequently OFCCP, to collect valuable, targeted data on the number of 
protected veterans who apply for Federal contractor positions. The data 
would enable the contractor and OFCCP to measure the effectiveness of 
the contractor's recruitment and affirmative action efforts over time, 
and thereby identify and promote successful recruitment and affirmative 
efforts taken by the contractor community.
    At the outset, several commenters addressed the issue of whether a 
pre-offer invitation to self-identify as a protected veteran was 
legally permissible under the Americans with Disabilities Act 
regulations, which limit the extent to which employers may inquire 
about disabilities prior to an offer of employment. The vast majority 
of commenters addressing the issue--including disability rights groups, 
veterans groups, and two commenters representing the contractor 
community--stated that the proposed pre-offer inquiry was legally 
permissible. Two commenters representing contractors on EEO matters 
disagreed. One stated that its clients avoid pre-offer inquiries 
specifically to avoid ``running afoul'' of the ADA. The other stated 
that ``[w]hile the ADA provides that an applicant can ask for a 
reasonable accommodation during the hiring process, employers cannot 
otherwise ask any questions about an individual's disability.''
    OFCCP believes the concerns of these two commenters are based on an 
incorrect reading of the ADA and its regulations. As we discussed in 
the NPRM, the ADA and section 503 regulations specifically permit the 
contractor to conduct a pre-offer inquiry into disability status if it 
is ``made pursuant to a Federal, state or local law requiring 
affirmative action for individuals with disabilities,'' such as VEVRAA. 
See 29 CFR 1630.13, 1630.14; 41 CFR 60-741.42. Further, as discussed in 
the NPRM, even though a pre-offer inquiry into disability status is 
legally permissible, the proposed pre-offer inquiry does not ask about 
disability status specifically; rather, it only asks that the applicant 
identify whether he or she is a protected veteran generally. 
Regardless, the ``affirmative action'' exception carved into the ADA 
clearly allows the type of pre-offer self-identification proposed in 
the NPRM, and thus there is no legal reason to modify it.\19\
---------------------------------------------------------------------------

    \19\ To assuage any remaining doubt on this matter, OFCCP 
obtained a letter from EEOC's Office of Legal Counsel in advance of 
the publication of this rule affirming that a requirement to invite 
pre-offer self-identification of disability is permissible under the 
ADA and its regulations. This letter will be posted on OFCCP's Web 
site.
---------------------------------------------------------------------------

    Among those commenters agreeing that the proposed pre-offer inquiry 
was legally permissible, however, two commenters--a disability rights 
association and a contractor--stated that the inclusion of paragraphs 
(a)(1) and (a)(2), which describe the conditions under which pre-offer 
invitations of disabled veterans are legally allowed, is confusing when 
they are stated ``additionally'' to the required pre-offer invitation 
in paragraph (a). One of these commenters stated it was unclear whether 
the inclusion of these paragraphs ``intended to require pre-offer 
invitation for all protected veterans or only for non-disabled 
protected veterans.'' Given that the new regulation requires all 
contractors to conduct a pre-offer inquiry that is lawful under the 
ADA, this guidance is now largely superfluous. Accordingly, as 
suggested by these commenters, this language (i.e., the third sentence 
of paragraph (a), and subparagraphs (1) and (2)) are not included in 
the final rule.
    The majority of those commenting upon the scope of the proposed 
pre-offer inquiry--requesting ``protected veteran'' status in the 
aggregate, as opposed to inviting individuals to identify as one or 
more of the categories of protected veteran--approved of it, but one HR 
consulting firm commenter stated that the pre-offer inquiry should ask 
individuals to denote the specific categories of veteran under which 
they fall, and that contractors could then aggregate the data for 
purposes of evaluating their outreach efforts and setting benchmarks. 
OFCCP declines to require contractors to collect data by protected 
veteran category at the pre-offer stage. We believe maintaining such 
refined data at this stage would be more burdensome on contractors than 
simply capturing whether interested job seekers are protected veterans 
or not, particularly given that the overall population of protected 
veterans is relatively small and that further division of the pool 
would tend to reduce the contractor's ability to engage in any 
meaningful data analysis. Further, as discussed in the NPRM, the 
contractor's obligations would be the same with respect to each 
category of protected veteran at the pre-offer stage, thus there is 
limited benefit at that stage to knowing the specific categories of 
protected veteran to which each individual belongs.
    The majority of those commenters opposed to the proposed pre-offer 
inquiry expressed concerns about the accuracy of veteran self-
identification data. First, several commenters from the contractor 
community asserted that not all protected veterans will self-identify--
either due to privacy concerns, fear of reprisal, or a failure to 
understand that they fall within one of the four listed categories of 
protected veterans--which will result in an underreporting of actual 
protected veteran applicants. Second, the commenters asserted that some 
veterans that are not protected by VEVRAA may nevertheless choose to 
self-identify as a protected veteran due to a misunderstanding of the 
four categories of protected veterans, which could lead to an 
inaccurate over-reporting of protected veterans. While some commenters 
urged OFCCP to eliminate the pre-offer inquiry entirely on these 
grounds, others propounded suggestions for how to increase the accuracy 
of self-reporting. One commenter suggested that the invitation include 
language that the applicant must know he or she is a protected veteran 
in order to self-identify as such (rather than the model language in 
Appendix B, which asks applicants to self-identify if they believe they 
are a veteran who may be protected), in order to ``minimize the 
possibility of self-identification error.'' Several other commenters 
requested that OFCCP provide contractors (and, in turn, applicants) 
with more detailed descriptions of the protected veteran categories, 
including, for instance, the specific campaign badges or Armed Forces 
service medals that qualify a veteran as an ``active duty wartime or 
campaign badge veteran'' or ``Armed Forces service medal veteran,'' 
respectively.
    At the outset, while OFCCP concedes the possibility that self-
reporting data on veterans will not be entirely accurate, OFCCP 
disagrees that this is sufficient reason to eliminate the pre-offer 
inquiry. Contractors already collect and report data on the number of 
protected veteran employees and new hires on an annual basis pursuant 
to the VETS-100A form. While this data is subject to the same accuracy 
concerns, it provides the Department with a useful measure for 
identifying and tracking the number of protected veteran new hires and 
employees among the Federal contractor workforce. Similarly, while 
self-reported applicant data will never be perfect, it is nonetheless a 
useful

[[Page 58628]]

mechanism for collecting important information that currently goes 
completely unrecorded--the number of protected veterans who are able to 
connect to Federal contractors and submit an expression of interest in 
employment. With regard to more detailed descriptions of the protected 
veteran categories, we note that the campaign badges and service medals 
are created and administered by the Department of Defense and the 
individual services of the Armed Forces, and thus those with questions 
would be best served consulting with DOD or the issuing military 
service if they have questions about whether a particular badge or 
medal is a campaign badge or service medal that provides coverage under 
VEVRAA.
    Another concern raised by several commenters is that the 
requirement to collect and maintain self-identification data from 
applicants does not comport with the Internet Applicant Rule found in 
the regulations to Executive Order 11246. See 41 CFR 60-1.3, 1.12. 
These commenters recommended that OFCCP add a definition of 
``applicant'' and ``Internet applicant'' to this final rule and ensure 
that wherever in the regulations the term ``applicant'' is used, the 
term ``Internet applicant'' applies as well. OFCCP did not propose to 
add a definition of ``applicant'' or ``Internet applicant'' in its 
NPRM. Therefore, the final rule does not do so. However, the discussion 
that follows provides guidance about how contractors may invite 
Internet applicants to self-identify as a protected veteran under 
VEVRAA in a manner consistent with demographic collection requirements 
under the Executive Order Internet Applicant Rule. Under this final 
rule, contractors will be able to invite applicants to self-identify as 
a protected veteran at the same time the contractor solicits 
demographic data on applicants under the Executive Order 112146 
Internet Applicant Rule. For Internet applicants this generally will be 
after the contractor has determined the individual has been screened 
for basic qualifications and meets other requirements for being an 
Internet applicant. Therefore, this final rule does not require 
contractors to change their existing systems for screening Internet 
applicants so long as those systems comply with existing law.
    By way of background, OFCCP's longstanding definition of 
``applicant'' is contained in agency subregulatory guidance. See the 
Uniform Guidelines on Employee Selection Procedures (UGESP), Question 
and Answer 15, 44 FR 11996 (March 2, 1979).\20\ According to that 
guidance, in general, an applicant is a person who has indicated an 
interest in being considered for hiring, promotion, or other employment 
opportunities, either in writing (by completing an application form or 
submitting a resume) or orally, depending upon the contractors' 
practice. The Internet Applicant Rule came into effect in February 
2006, and pertains to recordkeeping by contractors on Internet-based 
hiring processes and the solicitation of race, gender, and ethnicity 
data, in conjunction with their recordkeeping obligations under the 
Executive Order implementing regulation at Sec.  60-1.12. Under Sec.  
60-1.12, contractors' recordkeeping obligations include maintaining 
expressions of interest through the Internet that the contractor 
considered for a particular position, as well as applications and 
resumes. Contractors also are required to maintain, where possible, 
data about the race, sex, and ethnicity of applicants and Internet 
applicants, as appropriate. The term Internet applicant is defined in 
Sec.  60-1.3 and generally means an individual who: (1) Submitted an 
expression of interest in employment through the Internet; (2) is 
considered by the contractor for employment in a particular position; 
(3) possessed the basic qualifications for the position; and (4) did 
not remove himself or herself from consideration.
---------------------------------------------------------------------------

    \20\ Question and Answer 15 reads: ``Q. What is meant by the 
terms ``applicant'' and ``candidate'' as they are used in the 
Uniform Guidelines? A: The precise definition of the term 
``applicant'' depends upon the user's recruitment and selection 
procedures. The concept of an applicant is that of a person who has 
indicated an interest in being considered for hiring, promotion, or 
other employment opportunities. This interest might be expressed by 
completing an application form, or might be expressed orally, 
depending upon the employer's practice.''
---------------------------------------------------------------------------

    OFCCP has taken into account contractors' concerns about inviting 
self-identification for applications submitted electronically, 
particularly for those contractors who create resume data bases which 
they mine for applicants when they have a job opening. In recognition 
of these concerns, and consistent with EO 13563's focus on simplifying 
and harmonizing requirements, OFCCP will permit contractors to invite 
applicants to self-identify as a protected veteran at the same time as 
the contractor collects the demographic data for applicants required 
under EO 11246. The Internet Applicant Rule under EO 11246 generally 
allows contractors to do a ``first cut'' and screen out individuals 
whom they believe do not meet the basic qualifications of the 
position--without capturing or retaining any demographic documentation 
on these individuals. There is the concern, however, that in doing this 
``first cut'' contractors may be engaging in discrimination (e.g., if 
they are incorrectly applying their basic qualifications, or the basic 
qualifications have an adverse impact on a protected group and are not 
job related and consistent with business necessity), and by not keeping 
the demographic information on the individuals they screened out they 
are eliminating evidence to prove that discrimination may be occurring. 
This concern is even greater with regard to disabled veterans because 
these Executive Order ``first cuts'' are not designed to take into 
account the possibility that someone with a disability might be able to 
meet the qualification standard or perform the essential functions of 
the job with the provision of a reasonable accommodation.
    Under existing law, it is unlawful under VEVRAA to use 
qualification standards, including at the ``basic qualifications'' 
screen stage, that screen out or tend to screen out a disabled veteran 
or class of disabled veterans unless the standard is shown to be job-
related for the position in question and consistent with business 
necessity. Selection criteria that concern an essential function may 
not be used to exclude a disabled veteran if that individual could 
satisfy the criteria with a reasonable accommodation. See Sec.  60-
300.21(g). These requirements, therefore, apply when contractors design 
and implement their ``basic qualifications'' screens. In addition, 
after the initial screening for ``basic qualifications,'' contractors 
must also ensure that they are complying with their duty to evaluate 
all applicants for jobs based on the applicant's ability to perform the 
essential functions of the job with or without reasonable 
accommodation.
    OFCCP will treat the recordkeeping provisions of VEVRAA at 60-
300.80 in the same manner as the recordkeeping requirements under EO 
11246 at 41 CFR 60-1.12 as applied to Internet applicants. These 
recordkeeping requirements are not new and will impose no additional 
burden on contractors. The record retention requirements exist 
independently of whether and when individuals are invited to self 
identify under VEVRAA.
    The VEVRAA recordkeeping provisions require contractors to retain 
personnel or employment records made or kept by the contractor for one 
or two years depending on the size of the contractor and contract. 
These records

[[Page 58629]]

include the records contractors are required to maintain under 41 CFR 
60-1.12. Section 60-1.12 requires contractors to maintain all 
expressions of interest through the Internet or related technologies 
considered by the contractor for a particular position, such as on-line 
resumes or internal resume databases, and records identifying job 
seekers contacted regarding their interest in a particular position. 
For purposes of recordkeeping with respect to internal resume 
databases, the contractor also must maintain a record of each resume 
added to the database, a record of the date each resume was added to 
the database, the position for which each search of the database was 
made, and corresponding to each search, the substantive search criteria 
used and the date of the search. For purposes of recordkeeping with 
respect to external databases the contractor must maintain a record of 
the position for which each search of the database was made, and 
corresponding to each search, the substantive criteria used, the date 
of the search, and the resumes of job seekers who met the basic 
qualifications for the particular position who are considered by the 
contractor. As with records retained under the EO 11246, these records 
are to be maintained regardless of whether the job seeker is an 
Internet applicant.
    If a contractor has a practice of welcoming unsolicited resumes 
regardless of current job openings, OFCCP will permit the contractor to 
invite self-identification only of those considered for employment, 
consistent with requirements under EO 11246 and its regulations at 41 
CFR 60-1.3 and 60-1.12. The obligation to invite self-identification is 
triggered by considering the job seeker for employment, not by 
including the resume in the resume database. For example, if a 
contractor has an internal resume database with 1,000 resumes and is 
looking for applicants to fill a job as an engineer in Omaha, the 
contractor could limit the pool of resumes under review by applying a 
``basic qualifications'' screen that identifies those who have a 
masters degree in electrical engineering, at least three years of 
experience as an electrical engineer, and further limit the review to 
resumes submitted within the last three months. If that search produced 
a pool of 30 job seekers, the contractor might narrow the pool further 
by asking the 30 job seekers if they are interested in being considered 
for the job. If 10 job seekers indicate interest in being considered, 
they would be applicants and the contractor would invite the 10 job 
seekers to self-identify. In contrast, if a contractor has a practice 
of not accepting unsolicited resumes, job seekers who submit an 
unsolicited resume are not applicants. Accordingly, the contractor 
would have no obligation to invite them to self-identify as a protected 
veteran.
    It is also possible that potential and qualified job applicants 
with disabilities may not apply for jobs posted on contractors' online 
application systems because, for example, they are not aware that 
selection criteria concerning essential functions may not be used to 
exclude them if they can satisfy the criteria with a reasonable 
accommodation. Contractors seeking to fill jobs should seek to attract 
the best possible pool of applicants; this includes applicants who are 
disabled veterans who could perform the job with or without reasonable 
accommodations. OFCCP notes that a best practice for ensuring a 
diverse, qualified pool of applicants for contractors using online 
application systems is posting a notice on their human resources Web 
page or online application portal that notifies job applicants who may 
need a reasonable accommodation to perform the functions of a job that 
they are entitled to one under the ADAAA. This best practice encourages 
qualified individuals with disabilities to pursue job vacancies, and 
provides contractors with access to a wide range of skills and talents.
    In providing this guidance as to application of the self-
identification requirement under VEVRAA, contractors should be able to 
operate as they have been using their existing systems and processes 
because this final rule does not change how contractors handle Internet 
applicants. This should allow contractors to avoid creating separate 
data collection and storage systems as many contractors feared. For 
those contractors that need further help determining which individuals 
must be given a pre-offer self-identification inquiry, OFCCP is 
available to provide technical guidance.
    One commenter expressed concern regarding possible liability in 
connection with storing large amounts of sensitive data, such as that 
disclosed in an applicant's pre-offer self-identification form. 
However, the current regulations have long required contractors to 
maintain sensitive self-identification data that comes from post-offer 
inquiries, thus contractors should already have a mechanism in place 
for the proper storage of this information. While the additional pre-
offer data increases the amount of data that contractors will need to 
maintain, this is largely a scope or resources question, not an 
information security issue. We have addressed the expected cost and 
burden of the pre-offer requirement in the revised Regulatory 
Procedures section of the final rule.
    Finally, several commenters asserted that the new pre-offer inquiry 
would require significant lead time for contractors to change their 
current human resources information and applicant tracking systems so 
as to capture the pre-offer self-identification data. A revised burden 
analysis for these endeavors is included in the Regulatory Procedures 
section of the final rule. With regard to the amount of lead time 
necessary to incorporate the changes in this paragraph, one law firm 
commenter suggested that contractors be given ``a substantial grace 
period, which we propose to be at least one to two years,'' so that 
contractors and their systems providers can get up to speed. Another 
law firm commenter was less specific with the time needed, but said 
that ``90 days would not be enough time for some companies that do not 
have the internal resources to do it themselves.'' OFCCP has consulted 
with information systems analysts regarding an appropriate amount of 
preparation time, and on the basis of those discussions believes an 
effective date of 180 days after publication of the final rule is 
sufficient for contractors to incorporate Appendix B, or a 
substantially similar form, into their systems. Moreover, as noted in 
the Introduction to this preamble, contractors are permitted to update 
their affirmative action programs to come into compliance with the new 
requirements during their standard 12-month AAP review and updating 
cycle. If a contractor has prepared an AAP under the old regulations it 
may maintain that AAP for the duration of the AAP year even if that AAP 
year overlaps with the effective date of this final rule.
     Paragraph (b): Post-offer invitation to self-identify
    The NPRM created a new paragraph (b) to describe the contractor's 
duty to invite applicants to submit post-offer self-identification 
regarding the specific category of protected veteran to which the 
applicant belongs, and retain this information. As we explained in the 
NPRM, this self-identification requirement will enable the contractor 
to capture refined data pertaining to each category of protected 
veteran to foster the contractor's compliance with the requirement to 
report such data set forth in the Veterans' Employment and Training 
Service (VETS) regulations at 41 CFR part 61-300. Although OFCCP 
received no comments specific to new paragraph (b), the paragraph is 
revised

[[Page 58630]]

in the final rule to make this intent explicit. Accordingly, paragraph 
(b) is revised to state that, post-offer, ``the contractor shall invite 
applicants to inform the contractor'' if they belong to one or more of 
the categories of protected veteran ``for which the contractor is 
required to report pursuant to 41 CFR part 61-300.'' This clarifies 
that the contractor's paragraph (b) obligation to ask applicants to 
identify their specific protected veteran classification(s) is 
contingent upon their having an obligation to report that information 
on the VETS-100A, or other future form, pursuant to 41 CFR part 61-300.
     Paragraph (c): Content of invitations
    The NPRM revised paragraph (c) of this section by deleting the 
second sentence of the parenthetical at the end of the paragraph. This 
sentence described the format of and rationale behind the current 
Appendix B, which has been substantially amended in light of the new 
self-identification procedures proposed herein. We received no comments 
on this paragraph. Accordingly, the language in the NPRM is adopted as 
proposed. In addition, we revised the first sentence of paragraph (c) 
to say that invitations to self-identify ``shall state that the 
contractor is a Federal contractor required to take affirmative action 
to employ and advance in employment protected veterans pursuant to the 
Act.'' This language replaces the statement in the existing regulation 
that ``a request to benefit under the affirmative action program may be 
made immediately and/or at any time in the future.'' OFCCP believes 
that this statement could be misinterpreted to suggest that affirmative 
action must be ``requested'' by a protected veteran, thus confusing 
protected veterans and contractors alike.
     Paragraph (d): Requirement that contractor seek 
applicant's advice regarding accommodation
    There were three proposed changes to paragraph (d). First, we 
revised the language to reflect the newly proposed self-identification 
process in which applicants will only identify themselves as disabled 
veterans at the post-offer self-identification stage. Second, we 
replaced the term ``appropriate accommodation'' in paragraph (d) with 
``reasonable accommodation,'' which is the more broadly used and 
accepted legal term. OFCCP received no comments on these two changes, 
and thus the language in the NPRM is adopted as proposed.
    As for the third proposed change to paragraph (d), the NPRM 
required, rather than suggested, that the contractor seek the advice of 
the applicant regarding accommodation. As we explained in the NPRM, the 
idea was that this requirement would help to initiate a robust 
interactive and collaborative process between the contractor and the 
employee or applicant to identify effective accommodations that will 
facilitate a disabled veteran's ability to perform the job. OFCCP 
received 10 comments from various organizations on this change, all of 
which opposed the proposal.
    Several of these commenters argued that the proposed change is 
inconsistent with (and, according to some commenters, in violation of) 
the ADA, which states that an employer may ask all individuals if they 
require a reasonable accommodation, not just individuals that self-
identify as disabled. Specifically, several commenters cited ADA 
enforcement guidance from the EEOC stating that if an employer asks 
post-offer disability-related questions to entering employees, it must 
ask the same question to all entering employees in the same job group, 
and not a single classification of employees (such as ``disabled 
veterans''). However, as set forth in the discussion of paragraph (a) 
of this section, both herein and in the NPRM, the EEOC's interpretive 
guidance for its ADA regulations permits inquiries into disability 
status if made pursuant to another Federal law or regulation. It states 
that ``[t]he ADA does not preempt any Federal law, or any State or 
local law, that grants to individuals with disabilities protection 
greater than or equivalent to that provided by the ADA. This means that 
the existence of a lesser standard of protection to individuals with 
disabilities under the ADA will not provide a defense to failing to 
meet a higher standard under another law.'' See Appendix to 29 CFR part 
1630. Accordingly, the proposed affirmative action obligation, in 
requiring contractors to inquire with disabled veterans offered 
employment to determine if they need a reasonable accommodation, is not 
inconsistent with the ADA.
    However, other commenters, including a human resources association, 
asserted that disabled veterans should not be treated differently than 
disabled non-veterans with regard to reasonable accommodations, and 
that creating unique processes for veterans could serve to stigmatize 
veterans rather than help them. One commenter argued that the proposed 
change implies that contractors should assume that just because an 
individual self-identifies as a disabled veteran, they are in need of 
an accommodation, which may have negative and unintended consequences. 
Several other comments suggested that the proposed change does not take 
into account the administrative burden associated with ascertaining 
whether an individual is legally entitled to an accommodation and to 
research alternative sources of funding for requested accommodations 
when the accommodation is financially burdensome. Since the contractor 
is to be proactive in determining whether an individual needs an 
accommodation, the contractor would potentially have to conduct this 
research for each person that self-identifies as having a disability.
    The final rule does not incorporate the proposed requirement, and 
instead retains the existing rule's suggestion that contractors ask 
disabled veteran applicants whether an accommodation is necessary. The 
final rule also states that the contractor should engage in an 
interactive process with the applicant to help identify a reasonable 
accommodation, which is consistent with ADA guidance. Eliminating the 
proposed requirement alleviates the administrative burden concerns 
raised by some commenters, thus reducing the burden associated with the 
rule, while highlighting the importance of the reasonable accommodation 
obligation.
    Finally, the final rule makes a technical, non-substantive change 
by eliminating the parenthetical at the end of the second sentence 
which provides an example of a post-offer inquiry. OFCCP finds that 
this language is unnecessary and potentially confusing.
Section 60-300.43 Affirmative action policy
    The NPRM proposed replacing the phrase ``because of status as a'' 
in this section to ``against,'' in order to clarify that the 
nondiscrimination requirements of VEVRAA are limited to protected 
veterans and that reverse discrimination claims may not be brought by 
individuals who do not fall under one of the protected veteran 
categories. We received no comments on this section. Accordingly, Sec.  
60-300.43 is adopted in the final rule as proposed.
Section 60-300.44 Required contents of affirmative action programs
    The proposed rule contained significant revisions to several of the 
paragraphs under this section. These proposals, the comments to these 
proposals, and the revisions made to the final rule are discussed in 
turn below.
     Paragraph (a): Affirmative action policy statement
    Section 60-300.44(a) requires contractors to state their equal

[[Page 58631]]

employment opportunity policy in the company's AAP. The NPRM proposed 
revising the section to clarify the contractor's duty to provide notice 
of employee rights and contractor obligations in a manner that is 
accessible and understandable to persons with disabilities. The NPRM 
also proposed revising paragraph (a) to require the contractor's chief 
executive officer to clearly articulate their support for the company's 
AAP in the policy statement. OFCCP received three comments on the 
proposed revisions from an individual, a law firm and a human resources 
consulting group.
    There were a variety of comments on this section. One individual 
suggested that the policy statement include `retain' in the following 
sentence ``* * * the contractor will: Recruit, hire, train and promote 
persons in all job titles * * *'' Another commenter, a law firm, 
recommended revising the language so that it is inclusive of 
contractors that have foreign parent companies by requiring the top 
United States based executive to attest to their support for the 
contractor's AAP. Finally, the human resources consulting group 
expressed concern that OFCCP seemed to dictate the terms of the policy 
statement, but did not provide a sample statement as an Appendix.
    OFCCP declines to add the term ``retain'' to this section. The 
regulation currently states that the contractor's affirmative action 
policy must state that it will ``recruit, hire, train and promote 
persons in all job titles, and ensure that all other personnel actions 
are administered, without regard to'' protected veteran status. Given 
that the regulation already prohibits veteran status to be a 
consideration for ``all other personnel actions,'' there is no need to 
delineate further specific personnel actions in the regulatory text.
    OFCCP agrees with the suggestion to revise the language of this 
section to clarify the level of company leadership that must 
demonstrate their support for the company's AAP. The purpose of the 
proposed revision is to ensure that the statement communicates to 
employees that support for the AAP goes to the very top of the 
contractor's organization. For contractors with foreign-based parent 
companies, it is appropriate to require the company leadership that is 
based in the United States to express that support. Therefore, Sec.  
60-300.44(a) of the final rule is revised to state ``[t]he policy 
statement shall indicate the top United States executive's (such as the 
Chief Executive Officer or the President of the United States Division 
of a foreign company) support for the contractor's affirmative action 
program * * *.''
    OFCCP declines to make any modifications to the portion of Sec.  
60-300.44(a) related to the content of the policy statement. OFCCP 
outlined the required content of the policy statement when the agency 
issued the final rule implementing VEVRAA in 2007 (72 FR 44408). The 
NPRM did not propose any revisions to this language. OFCCP declines to 
append a policy statement to the rule. OFCCP believes that providing a 
policy statement in the Appendix may discourage contractors from 
proactively developing a policy statement that reflects the company's 
culture and values. If contractors need additional guidance on how to 
develop an equal opportunity policy statement, OFCCP staff is available 
to provide technical assistance.
     Paragraph (b): Review of personnel processes
    The proposed rule made two changes to this paragraph. First, it 
required that the contractor review its personnel processes on at least 
an annual basis to ensure that its obligations are being met, as 
opposed to ``periodically.'' Second, the proposed paragraph (b) 
mandated certain specific steps (carried over from the existing 
Appendix C) that the contractor must take, at a minimum, in the review 
of its personnel processes, including: (1) Identifying the vacancies 
and training programs for which protected veteran applicants and 
employees were considered; (2) providing a statement of reasons 
explaining the circumstances for rejecting protected veterans for 
vacancies and training programs and a description of considered 
accommodations; and (3) describing the nature and type of 
accommodations for disabled veterans who were selected for hire, 
promotion, or training programs.
    OFCCP received 13 comments from contractors, contractor 
associations and law firms regarding these proposals. Eleven of the 13 
comments asserted that a significant burden was imposed by the proposed 
section, much greater than that calculated by OFCCP in the NPRM's 
Regulatory Procedures section. For instance, regarding compliance with 
item (1) above, the commenters indicated that for most contractors 
there are no such tracking systems in place and these will take time, 
staff, and money to establish. The comments also indicate that 
promotion and training opportunities, unlike hiring, are not as readily 
distinguishable for individual candidates. It is noted that these 
opportunities may be available to all employees, take a number of 
different forms, and may be noncompetitive. The comments indicate it is 
``unreasonable'' to make this mandatory because it fails to recognize 
these differences and creates additional administrative and documentary 
burdens. These commenters further objected that the requirement to 
create and maintain a statement of reasons for every instance in which 
a protected veteran was denied a position or training activity was 
unreasonable and tantamount to requiring a drafted legal defense before 
any claims were brought, could serve to ``drive underground'' the real 
reason for the rejection, and treated protected veterans differently 
than protected classes under E O 11246 and section 503.
    Based on the comments submitted and the questions raised about the 
efficacy of these requirements toward the end of increasing employment 
of protected veterans as compared to the burden that it creates, OFCCP 
does not adopt the proposal as drafted in the NPRM, and the final rule 
retains the existing language in Sec.  60-300.44(b). However, in so 
doing, OFCCP reiterates that the existing paragraph (b) contains 
several requirements--including ensuring that its personnel processes 
are careful, thorough, and systematic, ensuring that these processes do 
not stereotype protected veterans, and designing some kind of 
procedures that facilitate a review of the implementation of these 
obligations--that still apply to contractors. As they do currently, 
contractors may coordinate the periodic review of their personnel 
processes for compliance with both VEVRAA and section 503.
     Paragraph (c): Physical and mental qualifications
    The NPRM proposed three substantive revisions to this paragraph. 
First, it required that all physical and mental job qualification 
standards must be reviewed and updated, as necessary, on an annual, as 
opposed to a ``periodic,'' basis. Second, paragraph (c)(1) of the NPRM 
required the contractor to document its annual review of physical and 
mental job qualification standards. Third, paragraph (c)(3) of the NPRM 
required the contractor to contemporaneously document those instances 
in which it believes that an individual would constitute a ``direct 
threat'' as understood under the ADA and as defined in these 
regulations.
    As to the proposal to require annual reviews of physical and mental 
job qualification standards, OFCCP received 10 comments from 
contractors, a contractor association, employee and other associations, 
and law firms. Nine of the 10 comments stated that the requirement to 
review physical and mental qualifications of all jobs with

[[Page 58632]]

openings during the AAP period would be burdensome because of the 
number of job openings, variety of jobs, time, staff and needed changes 
to HRIS systems. One employment benefit consultant firm commenter 
characterized the burden as ``one of the most burdensome requirements 
of the proposal.'' Additionally, one comment noted that the assumption 
that a description of the job's physical and mental requirements should 
already be available when a job opening occurs is a false assumption.
    Five comments suggested less burdensome approaches. One comment 
suggested continuing to follow the current regulation and conducting 
periodic reviews. Three comments suggested reviewing the qualifications 
only when a change in the job occurs. One of the three comments also 
noted that an initial review should occur with the start of the covered 
contract along with reviews when changes occur. One comment suggested 
doing reviews of only ``jobs filled,'' not all job openings.
    We note at the outset that the existing regulation clearly 
prohibits the contractor from using job qualification standards that 
are not job related and consistent with business necessity and have the 
effect of discriminating (or perpetuating discrimination) against 
protected veterans. See 41 CFR 60-300.21(d), 60-300.44(c)(2). This is a 
primary reason that the affirmative action provisions require reviews 
of physical and mental job qualification standards. To the extent that 
contractors are not conducting these reviews at all, they are already 
in violation of the existing regulations.
    With this in mind, and taking into account the commenters' concerns 
about the burden associated with the proposal, the final rule does not 
adopt the proposal as drafted in the NPRM. Instead, the final rule 
retains the language in existing Sec.  60-741.44(c)(1), requiring that 
contractors adhere to a schedule for the ``periodic review of all 
physical and mental job qualification standards,'' and providing that 
contractors have the burden to demonstrate that qualification standards 
that tend to screen out qualified individuals with disabilities are job 
related and consistent with business necessity.
    With regard to the second proposed change in paragraph (c)(1) 
requiring that the contractor document its job qualification standard 
reviews, we received four comments. All of these commenters questioned 
what evidence will be necessary to demonstrate that a review has been 
completed. One of these comments noted that the proposed regulation 
lacks clarity as to how job-relatedness is evidenced and asserted that 
the ADA practice of examining ``essential functions'' of a job should 
be sufficient. OFCCP declines to adopt this proposal into the final 
rule as well, and retains the existing provision. As for the comment 
that the ``job relatedness'' standard lacks clarity and should be 
replaced with an ``essential functions'' standard, we note that the 
``job related and consistent with business necessity'' standard has 
been used in the existing VEVRAA regulations for several years, and is 
the same standard that is well-understood and applies to the section 
503 regulations prohibiting discrimination on the basis of disability. 
We therefore decline to revise the standard in the final rule.
    Finally, with regard to the third proposed change requiring the 
contractor to contemporaneously document those instances in which it 
believes that an individual would constitute a ``direct threat,'' one 
comment raised the concern that the provision differed from the 
requirement in proposed Sec.  300.44(b)(3) to disclose the ``direct 
threat'' determination to the affected applicant or employee. However, 
because proposed Sec.  60-300.44(b)(3) was not adopted into the final 
rule, we decline to amend this paragraph to coordinate with it. Rather, 
we adopt paragraph (c)(3) as proposed in the NPRM.
     Paragraph (f): Outreach and recruitment efforts
    Paragraph (f) as it existed prior to the NPRM suggested a number of 
outreach and recruitment efforts that the contractor could undertake in 
order to increase the employment opportunities for protected veterans. 
The NPRM proposed several changes to this paragraph: the proposed 
paragraph (f)(1) required that the contractor enter into three linkage 
agreements with veteran-related entities to serve as sources of finding 
potential veteran applicants; paragraph (f)(2) included a list of 
additional suggested outreach and recruitment efforts that contractors 
could take; paragraph (f)(3) proposed a new requirement that the 
contractor conduct self-assessments of their outreach and recruitment 
efforts; and paragraph (f)(4) clarified the contractor's recordkeeping 
obligations with regard to these outreach and recruitment efforts.
    Overall, OFCCP received 34 comments on the proposed changes to 
Sec.  60-300.44(f). While a few commenters praised OFCCP's efforts to 
strengthen Federal contractors' recruitment and outreach efforts, the 
majority of the comments expressed concerns about the proposed rule. 
Commenters raised a variety of issues including concerns about the 
burden associated with the proposed mandatory requirements, technical 
questions regarding the drafting of the proposed rule language, and the 
utility of some of the recommended provisions.
    As stated above, paragraph (f)(1) required contractors to enter 
into three linkage agreements with three different veteran-related 
entities: specifically, the proposal required linkage agreements with 
(1) the Local Veterans' Employment Representative (LVER) in the local 
employment service office nearest the contractor's establishment; (2) 
one of several organizations listed in the existing regulation, with 
the addition of the Department of Defense Transition Assistance Program 
(TAP); and (3) an organization listed on the National Resource 
Directory (NRD), a Web site provided by the Departments of Labor, 
Defense, and Veterans Affairs. Commenters voiced several concerns with 
this proposal. Several commenters expressed concern about the 
administrative and financial burden related to requiring three linkage 
agreements. Further, a specific point made by one commenter echoed in 
general terms by several others was that, if the linkage agreement 
requirement was to be a ``per establishment'' requirement rather than a 
``per contractor'' requirement, a Federal contractor with multiple 
establishments could end up entering into hundreds of linkage 
agreements. Commenters also questioned the capacity of the 
organizations that are outlined in the proposed rule, noting that some 
of the entities listed in the NRD do not exist anymore, the DOD's TAP 
program does not reach all service members, and that some veterans' 
service organizations have difficulty generally getting through to 
staff or returning phone calls. While two commenters stated that 
entering into linkage agreements with LVERs was an appropriate 
requirement, several others raised the concern that LVERs, of which 
there are fewer than 1,000 in the entire country, may not have the 
capacity to enter into and manage linkage agreements with all Federal 
contractor establishments.
    In light of these comments, and in order to reduce the burden on 
contractors, the final rule does not incorporate the proposal requiring 
contractors to enter into linkage agreements. Rather, the final rule 
retains the existing language of Sec.  60-300.44(f), which requires 
that the contractor undertake ``appropriate outreach and positive 
recruitment activities,'' in paragraph (f)(1)(i) of the final rule, and 
then provides a number of suggested

[[Page 58633]]

resources in paragraph (f)(2)(i) that contractors should utilize to 
carry out their general recruitment obligations. Paragraph (f)(2)(i) of 
the final rule differs from the existing rule only in that it adds two 
additional resources discussed in the NPRM--the Department of Defense 
Transition Assistance Program (TAP) and the National Resource 
Directory--to the list of suggested resources that contractors should 
consult. This will allow contractors flexibility to choose the 
resources they feel will be most helpful in identifying and attracting 
protected veteran job seekers. It will also provide contractors with 
greater flexibility to switch between and among different resources in 
order to find those that are the most effective, in light of the self-
assessment obligation set forth in paragraph (f)(3) of the final rule. 
For those commenters who had concerns that the NRD contained resources 
that were out of date or did not contain additional resources that 
would be a good source for protected veteran job seekers, we note that 
the NRD is a dynamically-updated resource, and that contractors may 
suggest that additional veterans groups and service organizations be 
added to it through the ``Suggest a Resource'' link on the NRD's front 
page. On a related note, however, the reference to the specific URL 
address for the NRD's employment resources in the text of the 
regulation has been revised to refer to the NRD's home page. As one 
commenter noted, the URL listed in the regulation had changed since the 
publication of the NPRM, and may very well change again in the future, 
thus listing the URL address for a specific Web page in the regulation 
text makes little sense.
    Lastly with regard to paragraph (f)(1), several commenters argued 
that OFCCP underestimated the burden hours associated with complying 
with the proposed paragraph (f)(1)(iii) (paragraph (f)(1)(ii) in the 
final rule), which requires the contractor to send written notification 
of company policy related to its affirmative action efforts to all 
subcontractors, including subcontracting vendors and suppliers. OFCCP 
retains this requirement as proposed, as we believe it is crucial to 
effective implementation and enforcement of the regulations that 
subcontractors are aware of VEVRAA's affirmative action obligations. 
Compliance with this requirement could be met by providing 
subcontractors with the affirmative action policy statement it is 
already required to post on company bulletin boards pursuant to Sec.  
60-300.44(a), either electronically or in paper form. A discussion 
responding to commenters' concerns regarding the burden of compliance 
with this requirement is found in the Regulatory Procedures section of 
this final rule.
    OFCCP received relatively few comments regarding the proposed 
paragraph (f)(2) (paragraph (f)(2)(ii) in the final rule), which set 
forth additional suggested outreach efforts that contractors could 
engage in to increase its recruitment efforts. These comments centered 
on the proposed paragraph (f)(2)(vi) (which is paragraph (f)(2)(ii)(F) 
in the final rule), which states that ``the contractor, in making 
hiring decisions, shall consider applicants who are known protected 
veterans for all available positions for which they may be qualified 
when the position(s) applied for is unavailable'' (emphasis added). The 
commenters indicated that the word ``shall'' suggested that contents of 
that paragraph were mandatory. The use of ``shall'' in this paragraph 
was an inadvertent error in the NPRM. OFCCP intended the paragraph to 
state that contractors ``should consider applicants * * *'' and the 
final rule amends the NPRM in that regard. We also note that this 
suggested activity is intended to be a limited one. Contractors who 
choose to consider protected veterans for jobs other than those for 
which they applied may exercise discretion to limit this consideration 
based on geography, the qualifications of the applicant, and other 
factors. Contractors may also exercise discretion with respect to the 
time period by which they will consider applicants for other positions. 
This provision is intended to be flexible and is not required of 
contractors.
    The final rule adds an additional resource to paragraph (f)(2)(ii) 
that contractors are suggested to use, and that is the Veterans Job 
Bank. The Veterans Job Bank, created by the Obama Administration and 
launched in November 2011 as part of the National Resource Directory 
Web site, is an easy-to-use tool aimed at helping veterans find job 
postings from companies looking to hire them. Through the Veterans Job 
Bank, veterans are able to search hundreds of thousands of jobs 
(500,000 at the time the Veterans Job Bank was launched) by location, 
keyword, and military occupation code (MOC). Further, the Web site 
provides detailed instructions for employers wishing to post their job 
openings with the Veterans Job Bank, so that the resource can continue 
to grow and become an even more effective resource for veterans seeking 
new job opportunities and employers seeking qualified workers.
    Paragraph (f)(3) of the NPRM required the contractor, on an annual 
basis, to review the outreach and recruitment efforts it has undertaken 
over the previous twelve months and evaluate their effectiveness in 
identifying and recruiting qualified protected veterans, and document 
its review. Several commenters expressed concern about the utility of 
the suggested metrics for analyzing external outreach and recruitment 
efforts. One commenter stated that if the only standard used for 
assessing outreach and recruitment is the number of veterans hired, the 
proposed rule would effectively become a quota system for hiring 
protected veterans. Another commenter questioned whether overall hiring 
statistics would provide much useful information about the 
effectiveness of specific outreach efforts. Commenters also had 
concerns about the requirement to analyze hiring data for the current 
year as well as the previous two years. One commenter stated that 
``[e]very other analytical requirement under the affirmative action 
regulations, including Executive Order 11246, focuses on reviewing the 
past one-year recordkeeping period.'' Commenters argued that the most 
recent year is the most relevant year in measuring effectiveness of 
affirmative action efforts. Finally, commenters also questioned OFCCP's 
calculation of the cost of compliance with this provision.
    OFCCP declines to make changes to the proposed paragraph (f)(3) in 
response to these comments. With regard to the comment suggesting that 
the number of veterans hired was the ``only'' standard for analyzing 
the effectiveness of outreach efforts, OFCCP respectfully disagrees. 
The proposed rule makes clear that the number of veterans hired should 
be a primary factor considered, given VEVRAA's stated purpose to 
``employ and advance in employment'' protected veterans, but is far 
from the only metric used for analyzing external outreach and 
recruitment efforts. Rather, the proposed rule required that the 
contractor consider all the metrics required by Sec.  60-300.44(k) 
(which includes applicant and hiring data), but also clearly allows the 
contractor to consider any other criteria, including ``a number of 
factors that are unique to a particular contractor establishment,'' in 
determining the effectiveness of its outreach, so long as these 
criteria--whatever they are--are reasonable and documented so that 
OFCCP compliance officers can understand what they are. The purpose of 
the self-assessment is simply to ensure that the contractor

[[Page 58634]]

thinks critically about how to evaluate and improve upon its 
recruitment and outreach efforts in order to maximize its connections 
to protected veterans seeking jobs. OFCCP strongly believes this is a 
worthy goal--indeed, a goal central to the very heart of VEVRAA's 
affirmative action obligations--and that the proposal provides the 
contractor a significant amount of flexibility to meet that goal.
    With regard to the timeframe of applicant and hire data that a 
contractor must consider when evaluating its outreach efforts--the 
current year and two previous years--OFCCP understands that this is a 
longer period than that required by, for instance, the Executive Order, 
which looks to hiring and applicant data over the previous year. 
However, VEVRAA is a different law with different analytic mechanisms. 
As explained in the NPRM, the purpose of considering a longer history 
of data under VEVRAA is because it will provide more complete 
information through which a contractor can understand which outreach 
efforts it has engaged in historically have tended to correspond with 
increased veteran applicants and hires. Further, we do not believe that 
requiring contractors to look at and compare a few additional numbers, 
which are already calculated pursuant to Sec.  60-300.44(k), is 
onerous, particularly compared to the potential benefit. Accordingly, 
we retain the paragraph (f)(3) in the final rule as written in the 
NPRM. OFCCP has conducted an amended calculation of the cost of this 
provision in light of the comments provided, set forth in the 
Regulatory Procedures section of this final rule.
    The final rule makes one small change to the second to last 
sentence in paragraph (f)(3). As explained in the preamble to the NPRM, 
OFCCP proposed that the contractor's conclusion as to the effectiveness 
of its outreach efforts ``shall be reasonable as determined by OFCCP in 
light of these regulations.'' The final rule replaces the word 
``shall'' with ``must,'' which more clearly describes the requirement.
    Finally, several commenters expressed concern about the five-year 
recordkeeping requirement set forth in paragraph (f)(4). As discussed 
previously in this final rule and in the discussion of recordkeeping in 
Sec.  60-300.80, and for the reasons stated therein, OFCCP amends this 
to a three-year recordkeeping requirement. While this documentation may 
take several forms, such documentation may include, for example, the 
numbers and types of outreach and recruitment events, the targeted 
group(s) or types of participants, when and where the events occurred, 
and who conducted and participated in the outreach and recruitment 
efforts on behalf of the contractor.
     Paragraph (g): Internal dissemination of affirmative 
action policy
    This section requires contractors to develop internal procedures to 
communicate to employees their obligation to engage in affirmative 
action efforts to employ and advance in employment qualified protected 
veterans. The NPRM proposed requiring the contractor to undertake many 
specific actions that are only suggested in the existing rule, 
including incorporating the affirmative action policy in company policy 
manuals, informing all applicants and employees of the contractor's 
affirmative action obligations, and conducting meetings with management 
and company leadership to ensure they are informed about the 
contractor's obligations. The NPRM also proposed requiring contractors 
to hold meetings with employees at least once a year to discuss the 
company's VEVRAA affirmative action policy. OFCCP received 17 comments 
on Sec.  60-300.44(g) from a variety of groups, including a disability 
association, an employee association, four contractor associations, 
four law firms, and two individuals, among others.
    One commenter proposed maintaining some of the language in the 
current Sec.  60-300.44(g)(1). The commenter expressed concern about 
the NPRM's deletion of the following sentence: ``[t]he scope of the 
contractor's efforts shall depend upon all the circumstances, including 
the contractor's size and resources and the extent to which existing 
practices are adequate.'' The commenter asserted that deleting this 
sentence leaves the requirement without an applicable measure of 
compliance. The commenter recommended maintaining the language in the 
section and defining ``adequate'' to mean ``being received and 
understood by veterans, as determined in sample interviews.''
    The final rule adopts the proposed language in Sec.  60-
300.44(g)(1) without change because the rule provides a measure of 
compliance, thus making the suggested change unnecessary. This section 
clearly states that the procedures for internally disseminating 
affirmative action policies ``. . . shall be designed to foster 
understanding, acceptance and support among the contractor's executive, 
management, supervisory and other employees and to encourage such 
persons to take the necessary actions to aid the contractor in meeting 
this obligation.'' Further, the revisions clearly identify the actions 
that contractors must undertake to meet this obligation.
    With regard to the remainder of paragraph (g), the existing rule 
has a single paragraph (g)(2) that lists eight separate actions that 
contractors were suggested to undertake to implement and internally 
disseminate their internal affirmative action policies. The NPRM 
proposed to mandate some of these actions and thus restructured the 
remainder of paragraph (g). Paragraph (g)(2) of the NPRM listed five 
internal dissemination efforts that would be required of all 
contractors: (i) Including the contractor's affirmative action policy 
toward veterans in the contractor's policy manual; (ii) informing all 
employees and prospective employees of the contractor's affirmative 
action obligations and having annual meetings with employees to discuss 
these obligations; (iii) conducting meetings with executive, managerial 
and supervisory personnel to ensure they understood the intent of the 
policy and responsibility for its implementation; (iv) discussing the 
policy thoroughly in employee orientation and management training 
programs; and (v) if the contractor is party to a collective bargaining 
agreement, informing union officials and/or employee representatives of 
the contractor's affirmative action policy and requesting the union's 
cooperation in implementing it. Paragraph (g)(3) of the NPRM listed 
additional dissemination efforts that would continue to be suggested 
efforts as in the existing rule, such as publicizing its affirmative 
action policy in company publications and including in these 
publications features and articles of protected veteran employees. 
Finally, paragraph (g)(4) of the NPRM set forth the recordkeeping 
obligations in connection with those actions contractors undertook.
    We received many comments in response to the elements that were 
required in paragraph (g)(2) of the NPRM. Some commenters requested 
alternative options to including the affirmative action policy in the 
contractor's policy manual pursuant to the proposed Sec.  60-
300.44(g)(2)(i). A law firm suggested allowing for posting the policy 
on the company's intranet where similar human resources and EEO 
pronouncements are found. One comment requested that OFCCP clarify the 
requirement to make it optional for contractors that do not have policy 
manuals. Several of the comments expressed concern about the 
requirement in the proposed paragraph

[[Page 58635]]

(g)(2)(ii) to hold a meeting at least once a year with employees to 
discuss affirmative action obligations. Commenters asserted the OFCCP 
miscalculated the burden associated with hosting these meetings, 
stating that requiring this element would incur a much higher burden. 
Commenters stated that OFCCP should allow contractors to disseminate 
the equal employment opportunity policy at regularly scheduled meetings 
and allow for electronic and web-based formats. Commenters also stated 
that it was unclear what would constitute adequate training and 
compliance with the newly required elements of paragraph (g)(2).
    In response to the comments, and with an eye toward reducing the 
burden on contractors, the final rule narrows the scope of the internal 
dissemination efforts that will be required of contractors from that 
set forth in the NPRM. Two of the five elements that the NPRM proposed 
to require are maintained as requirements in paragraph (g)(2) of the 
final rule: (1) Including the policy in the contractor's policy manual; 
and (2) notifying (a change from ``meeting with'' in the NPRM, in order 
to facilitate compliance) union officials to inform them of the policy 
and request their cooperation, if the contractor is party to a 
collecting bargaining agreement. The first of these requirements is 
modified slightly from what was proposed in the NPRM based on comments 
received so as to allow contractors to include the affirmative action 
policy either in the contractor's policy manual, or to otherwise make 
the policy available to its employees. We believe that most companies 
generally have some form of document that provides guidance on human 
resources policies and procedures--either a policy manual, employee 
handbook, or similar document- that is available to employees that is 
an appropriate place to put the policy. OFCCP believes including the 
affirmative action policy in these documents will enhance the 
visibility of the contractor's commitment to protected veterans. 
However, the final rule also allows contractors the flexibility to make 
the policy available to its employees through other means. This could 
include posting the policy on a company intranet, but this will only 
fulfill the requirement if all employees have access to this intranet.
    The remaining elements that were required in the NPRM and/or were 
suggested in the existing rule remain in paragraph (g)(3) of the final 
rule as actions that the contractor is suggested to take, with the 
exception of the recordkeeping provision, which has been eliminated. We 
note, however, that to the extent any activities undertaken pursuant to 
paragraph (g) involve the creation of records that are subject to the 
general recordkeeping requirement of Sec.  60-300.80, contractors will 
still be required to maintain such documents as specified by Sec.  60-
300.80.
     Paragraph (h): Audit and reporting system for affirmative 
action program
    Section 60-300.44(h) outlines the contractor's responsibility to 
design and implement an audit and reporting system for the company's 
AAP. The NPRM proposed requiring contractors to document the actions 
taken to comply with the section. The NPRM also proposed that 
contractors maintain the records of their documentation subject to the 
recordkeeping requirements of Sec.  60-300.80. OFCCP received one 
substantive comment on the proposed revisions. The commenter, a human 
resources consulting group, stated that the documentation requirement 
would be potentially burdensome.
    This section is adopted in the final rule as proposed. Many of the 
requirements of Sec.  60-300.44(h) necessitate developing 
documentation. The section requires contractors to measure the 
effectiveness of its affirmative action program, indicate any need for 
remedial action, determine the degree to which the contractor's 
objectives have been attained, determine whether protected veterans 
have had the opportunity to participate in all company professional and 
social activities, and measure the contractor's compliance with the 
program's specific obligations. Section 60-300.44(h)(2) requires 
contractors to undertake necessary action to bring the program into 
compliance. In order to conduct this kind of analysis, many contractors 
will likely develop documentation. The final rule formalizes that 
process for all contractors and requires that the documentation be 
maintained in accordance with the recordkeeping requirements of Sec.  
60-300.80. OFCCP feels strongly that this requirement will allow for a 
more effective review of whether the contractor's affirmative action 
obligations in this paragraph are being met.
     Paragraph (i): Responsibility for implementation
    The only substantive proposed change in paragraph (i) required that 
the identity of the officials responsible for a contractor's 
affirmative action activities must appear on all internal and external 
communications regarding the contractor's affirmative action program. 
In the current regulation, this disclosure is only suggested. Upon 
further review, OFCCP does not believe that the benefit of this 
suggested change outweighs the potential burden that it would place on 
contractors. Accordingly, the final rule does not incorporate the 
proposal, and the language in the existing regulation that contractors 
should, but are not required, to take this step is retained.
     Paragraph (j): Training
    Paragraph (j) of the existing regulation already requires that the 
contractor train ``[a]ll personnel involved in the recruitment, 
screening, selection, promotion, disciplinary and related processes . . 
. to ensure that the commitments in the contractor's affirmative action 
program are implemented.'' The NPRM proposed revising this paragraph to 
identify specific topics that must be considered in this training, 
including: the benefits of employing protected veterans; appropriate 
sensitivity toward protected veteran recruits, applicants and 
employees; and the legal responsibilities of the contractor and its 
agents regarding protected veterans generally and disabled veterans 
specifically, such as reasonable accommodation for qualified disabled 
veterans and the related rights and responsibilities of the contractor 
and protected veterans. The NPRM also required that the contractor 
record which of its personnel receive this training, when they receive 
it, and the person(s) who administer(s) the training, and maintain 
these records, along with all written or electronic training materials 
used.
    OFCCP received 12 comments from law firms, disability and veterans 
associations, and contractors and contractor associations. The majority 
of these comments raised concern regarding the burden the training 
requirements places on contractors and the manner in which OFCCP 
calculated it. Several comments noted specific concerns about what 
constitutes ``sensitivity'' training. Two commenters suggested that 
OFCCP or OFCCP-approved training programs should be offered, instead of 
the contractor having to create additional training to what is done 
now.
    Taking these comments into account, and balancing the utility of 
the proposal against the burden that it would create for contractors, 
the final rule does not incorporate the portion of the proposed rule 
listing specific training items that must be covered by contractors or 
the specific recordkeeping requirement. However, the final rule does 
retain the existing rule's general requirement that ``[a]ll personnel 
involved in the recruitment, screening, selection, promotion, 
disciplinary, and related processes'' must be trained to ensure that 
the contractor's affirmative action

[[Page 58636]]

commitments are implemented. Further, we note that to the extent any 
activities undertaken pursuant to paragraph (j) involve the creation of 
records that are subject to the general recordkeeping requirement of 
Sec.  60-300.80, contractors will still be required to maintain such 
documents as specified by Sec.  60-300.80.
     Paragraph (k): Data Collection Analysis
    The proposed regulation added paragraph (k) to the rule, requiring 
that the contractor document and update annually the following 
information: (1) For referral data, the total number of referrals, the 
number of priority referrals of protected veterans, and the ``referral 
ratio'' of referred protected veterans to total referrals; (2) for 
applicant data, the total number of applicants for employment, the 
number of applicants who are known protected veterans, and the 
``applicant ratio'' of known protected veteran applicants to total 
applicants; (3) for hiring data, the total number of job openings, the 
number of jobs filled, the number of known protected veterans hired, 
and the ``hiring ratio'' of known protected veteran hires to total 
hires; and (4) the total number of job openings, the number of jobs 
that are filled, and the ``job fill ratio'' of job openings to job 
openings filled.
    As stated in the NPRM, the impetus behind this new section is that 
no structured data regarding the number of protected veterans who are 
referred for or apply for jobs with Federal contractors is currently 
maintained. This absence of data makes it nearly impossible for the 
contractor and OFCCP to perform even rudimentary evaluations of the 
availability of protected veterans in the workforce, or to make any 
sort of objective, data-based assessments of how effective contractor 
outreach and recruitment efforts have been in attracting protected 
veteran candidates. Conversely, maintaining this information will 
provide the contractor with much more meaningful data for evaluating 
and tailoring its recruitment and outreach efforts.
    OFCCP received a total of 52 comments from veterans' associations, 
a disability association, an employee association, contractor 
associations, medical and other associations, law firms, and 
contractors. The three veterans and disability associations that 
commented on the proposal supported the required data collection and 
the goal behind it. Virtually all commenters from the contractor 
community opposed the proposal on varying grounds, including: issues 
with the integrity of the data to be collected (and particularly data 
on referrals); assertions that some of the data conflicts with the 
Internet Applicant Rule in the Executive Order regulations; and 
assertions that collecting, analyzing, and maintaining the data would 
be unduly burdensome. Further, 19 commenters, all of whom were members 
of the construction industry, submitted form letters asserting that 
they should be exempted from the requirement due to the unique nature 
of their industry. Finally, a number of commenters sought clarification 
of some of the processes set forth in paragraph (k). These issues are 
considered in turn below.
    With regard to the eleven data elements required by the proposed 
new section, 40 comments (total includes 19 form letters) articulated 
data integrity concerns regarding data to be used in calculating the 
referral ratio. Comments describe the state employment service delivery 
systems as ``self-service,'' leaving source identification to the 
candidate for the job, and as such making data unreliable in terms of 
identifying referrals. Examples were provided indicating that veterans 
may apply directly online with a company and may fail to identify that 
he/she was referred and even that he/she is a veteran. These comments 
also raised the issue that the referral ratio does not account for 
referrals from sources other than the state employment service delivery 
systems and may include referrals of veterans that are not qualified 
for the position(s) at issue. For the reasons set forth in the 
discussion of the proposed paragraph 5 of the EO Clause (Sec.  60-
300.5), OFCCP has eliminated from the final rule the requirement for 
contractors to collect, maintain, and analyze information on the number 
of referrals and the ratio of priority referrals of veterans to total 
referrals, i.e., paragraphs (k)(1), (k)(2), and (k)(3) in the NPRM. 
This eliminates many of the concerns commenters had with regard to this 
paragraph, and also serves to decrease the burden on contractors.
    However, eight of these comments also discussed the requirement to 
document and maintain applicant and hiring ratios. These comments 
reiterated data integrity issues and questions about the purpose of 
conducting the calculations or comparisons. One of the primary issues 
identified by commenters is that applicant data appears to be dependent 
upon self-identification which is not reliable. These issues were 
addressed in the discussion of the invitation to self-identify 
proposals in Sec.  60-300.42(a). In short, demographic data based on 
self-identification will never be perfect, but it is the best data that 
is available.
    Another identified concern is that the proposed data collection and 
analysis is not aligned with the availability analysis conducted when 
examining employment activities for females and minorities. However, as 
stated previously in this preamble, VEVRAA and the Executive Order are 
different laws with different data calculation and enforcement schemes, 
largely because of the differences in the Census and other data 
available. It is, therefore, not feasible to pattern data collection 
after the Executive Order regulations.
    Comments also questioned the purpose of the job opening/job filled 
ratio. On a related point, one comment from a law firm noted that there 
appears to be an underlying assumption that there will be jobs that are 
not filled which is seldom true in the current economic environment. 
While it may not be a common occurrence in the current economic 
environment: (a) this does not mean it never happens (and if it never 
does, the burden on the contractor to calculate a ``job fill ratio'' 
shrinks to virtually nothing); and (b) the current economic environment 
will not last forever, at which point these regulations will still be 
in effect. The job fill ratio is a commonly recorded metric by 
companies and HR professionals, as it measures the effectiveness of a 
company's recruiting efforts. Also, in some cases, a particularly low 
job fill ratio could be an indicator that the company's hiring process 
is being conducted incorrectly. This is useful information for both the 
contractor and OFCCP. We have eliminated the requirement, however, that 
contractors document and maintain for three years the ratio of jobs 
filled to job openings and the ratio of protected veterans hired to all 
hires. The remaining data points permit OFCCP and the contractor to 
make those calculations; thus separate data collection is unnecessary. 
Several commenters also objected to the collection of data about 
protected veteran status of applicants because it differs from the 
recordkeeping requirements related to Internet Applicants under the EO 
11246 implementing regulations at 41 CFR 60-1.12. We addressed this 
issue in the discussion of the pre-offer self-identification 
requirement, and incorporate by reference that discussion here, but we 
wish to reiterate the salient points here in response. Under Sec.  60-
1.12, contractors' recordkeeping obligations include maintaining 
expressions of interest through the Internet that the contractor 
considered for a particular position, as well as applications and 
resumes. Contractors

[[Page 58637]]

also are required to maintain, where possible, data about the race, 
sex, and ethnicity of applicants and Internet Applicants, as 
applicable. The term Internet Applicant is defined at Sec.  60-1.3. The 
term ``applicant'' is defined in OFCCP subregulatory guidance. The 
Internet Applicant definition is limited to OFCCP recordkeeping and 
data collection requirements under the Executive Order implementing 
regulations in Sec.  60-1.12.
    In sum, after consideration of the comments received, the final 
rule retains the NPRM's proposal for contractors to document and 
maintain applicant, hiring, and job fill ratio data, but eliminates the 
requirement for contractors to document and maintain referral data.
    With regard to burden calculation issues, 43 of the 52 commenters, 
entirely from the contractor community, indicated that OFCCP had not 
correctly calculated the burden of this section. Specific cost 
information was provided by two commenters. A contractor association 
that combined comments from three such entities indicated that a survey 
conducted by the association found OFCCP's estimate of six minutes a 
year to collect, maintain and ``in some cases'' calculate the data 
elements should be stated more accurately as six hours. A revised 
burden calculation is included in the Regulatory Procedures section of 
this final rule, as well as the methodology behind the revised 
calculation, but we wish to highlight a few points here where we 
believe the contractor community may have misunderstood portions of the 
burden we proposed they undertake. First, as stated above, the referral 
data metrics have been eliminated, which reduces the burden. Second, 
the hiring metrics are already maintained and calculated by the 
contractor as part of its existing obligation under 41 CFR part 61-300; 
therefore, that portion of paragraph (k) does not create any additional 
burden. The only ``new'' items proposed were those pertaining to the 
self-identification applicant data and the job fill ratio.
    Also pertaining to burden, 19 commenters from the construction 
industry asserted that they should be exempted from this section of the 
proposed regulation because of the unique nature of the industry, 
namely that it is project-based and its workers are transitory and 
seasonal. Traditionally, construction contractors who meet the basic 
coverage requirements (contract amount and number of employees) of 
VEVRAA have not been exempted from any of its provisions. This includes 
the collection of data under part 61-300 for the VETS-100A report, 
which tracks the numbers of new hires and overall employees who are 
protected veterans, data which makes up a significant portion of the 
requirements under paragraph (k). Accordingly, we decline to exempt 
construction contractors.
    Commenters from the contractor community also cited burden concerns 
with the proposed requirement to maintain the paragraph (k) 
computations for a period of five (5) years. As set forth in the 
discussions of Sec.  60-300.44(f)(4) and Sec.  60-300.80 herein, the 
final rule reduces the document retention requirement to three (3) 
years, and revises the language of paragraph (k) to reflect this 
change.
    Finally, a few of the comments raised clarification questions we 
would like to address, including: (1) Whether the intent of the 
analyses is to measure change from year to year; (2) whether the ratios 
should be run by job group, job title, or establishment; and (3) how 
compliance determinations will be made. As to the first question, as 
set forth in the discussion of Sec.  60-300.44(f)(3), measuring change 
from year to year, and looking at two previous years of data, is a 
central intent of the analyses, as that can aid the contractor in 
seeing trends that may be associated with certain of its outreach and 
recruitment efforts over time. However, as discussed in that section, 
contractors are also free to use any other reasonable criteria in 
addition to the applicant and hiring data they feel is relevant to 
evaluate the effectiveness of their efforts. As to the second question, 
the ratios in paragraph (k) will be calculated by establishment, and 
not by job groups or titles within a given establishment. The number of 
protected veterans in the civilian workforce is relatively small (at 
least compared to the number of women or minorities nationwide), and 
thus we believe that running analyses by job groups or titles is 
unlikely to provide any meaningful analysis.
    With regard to the third question, compliance determinations for 
paragraph (k) will be made based simply on whether the contractor has 
documented and maintained the five listed metrics in the final rule. 
OFCCP Compliance Officers will not be using the applicant and hiring 
data to conduct underutilization or impact ratio analyses, as is the 
case under the Executive Order, and enforcement actions will not be 
brought solely on the basis of statistical disparities between veterans 
and non-veterans in this data. Compliance officers will look to see 
whether the contractor has fulfilled its obligations under Sec.  60-
300.44(f)(3) to critically analyze and assess the effectiveness of its 
recruitment efforts, using the data in paragraph (k) as well as any 
other reasonable criteria the contractor believes is relevant, and has 
pursued different and/or additional recruitment efforts if the 
contractor concludes that its efforts were not effective.
Section 60-300.45 Benchmarks for hiring
    The NPRM proposed that the contractor establish annual hiring 
benchmarks by using existing data on veteran availability from five 
different sources of information: (1) Bureau of Labor Statistics data 
of the average percentage of veterans in the civilian labor force in 
the State where the contractor is located; (2) the raw number of 
protected veterans who participated in the employment service delivery 
system (i.e., One-Stop Career Centers) in the State where the 
contractor is located; (3) the referral, applicant, and hire data 
collected by the contractor pursuant to Sec.  60-300.44(k); (4) the 
contractor's recent assessments of its outreach and recruitment efforts 
as set forth in Sec.  60-300.44(f)(3); and (5) any other factors, 
including but not limited to the nature of the contractor's job 
openings and/or its location, which would tend to affect the 
availability of protected veterans. The last of these factors would 
allow the contractor to take into account other factors unique to its 
establishment that would tend to affect the availability determination. 
The NPRM also proposed to require contractors to document the hiring 
benchmark it established each year, detailing each of the factors that 
it considered in establishing the hiring benchmark and the relative 
significance of each of these factors, and required the contractor to 
retain this document for a period of five years.
    OFCCP received a total of 38 comments on the proposed new 
requirement to establish annual hiring benchmarks for protected 
veterans. Three comments from organizations representing employee 
interests, including a disability association and a veterans 
association, stated that requiring benchmarks using available 
statistics was an important development, and supported the proposed 
regulation in general terms. The remaining comments, virtually all of 
which were from contractors or those representing contractors, opposed 
the requirement for contractor-established benchmarks as proposed. The 
reasons set forth for their opposition fell into five general 
categories: (1) A belief that

[[Page 58638]]

the benchmarks were equivalent to ``quotas''; (2) hiring benchmarks for 
protected veterans would adversely impact women and minorities; (3) the 
benchmarks as proposed were arbitrary and ineffective given that the 
data to be relied upon is not specific to veterans protected by VEVRAA 
and does not correlate to specific job groups, skills, or geographical 
areas; (4) the proposed five-year recordkeeping requirement conflicts 
with equivalent requirements in other laws administered by OFCCP; and 
(5) that setting benchmarks as proposed in the NPRM was unduly 
burdensome for contractors, and OFCCP underestimated the cost and 
burden of the proposal. Further, some commenters provided 
recommendations for how to amend the proposed benchmarks, and others 
submitted questions seeking clarification of aspects of OFCCP's 
proposal. As detailed below, the final rule contains a substantial 
revision, allowing contractors the option of using a benchmark based on 
national veteran data. This option would substantially decrease the 
burden on contractors.
    Before addressing each of the issues raised by the commenters, 
providing some further context and explanation for the proposal and how 
OFCCP envisioned the proposed requirement would work in practice is 
appropriate.
    The primary intent of the benchmark proposal was to provide the 
contractor a yardstick that could be used to measure progress in 
employing protected veterans. OFCCP recognized that data demonstrating 
the availability of protected veterans that is similar to the data used 
to compute availability and establish goals under the EO 11246 program 
does not exist. Owing to the imprecise nature of the data upon which 
benchmarks would be based, OFCCP did not propose additional affirmative 
action obligations (or OFCCP enforcement actions) if a contractor did 
not meet the benchmark that it set. To be sure, OFCCP would expect that 
as part of its annual recruitment and outreach assessment, the 
contractor would assess why it did not meet the benchmark and adjust 
its recruitment efforts for the following year based on what it has 
learned. However, the proposal would not have OFCCP undertake 
enforcement action solely on the basis of a disparity between the 
benchmark and the actual percentage of veterans hired.
    Further highlighting the difference between the benchmark proposal 
and the availability and utilization calculations traditionally 
required under the Executive Order 11246 program, OFCCP designed the 
benchmark proposal to allow the contractor maximum flexibility to take 
into account any additional factors it thought would increase or 
decrease a reasonable benchmark and to weigh these factors in any 
reasonable manner it saw fit. For instance, the contractor might start 
with the average veteran population for its state, reduce this number 
slightly to account for the fact that this data was not limited to 
protected veterans, average this number with the percentage of 
protected veteran applicants it had received over the past three years, 
and increase the resulting percentage slightly in anticipation of 
additional recruiting efforts it knew it would be doing in the next 
year. Then, the contractor could adjust this number up or down 
depending on the overall nature of the work performed at the 
establishment and how that coincides with experience veterans generally 
have, whether the contractor knew that there was a particularly high or 
low number of veterans in the relevant hiring area, or any other 
reasonable factor. So long as the contractor adequately described and 
documented the factors it took into account, it would comply with the 
Sec.  60-300.45 requirement.
    Finally, OFCCP intended the benchmark proposal to raise awareness 
of the significant number of veterans who, having made enormous 
sacrifices defending our nation on our behalf, nevertheless continue to 
face considerable difficulties finding work upon their return home. 
These veterans are highly trained, highly skilled, disciplined, and 
possess considerable leadership and team-building experience--in other 
words, excellent candidates for employment. While recent Federal 
efforts have greatly helped veterans' employment prospects, the service 
of these veterans to our nation abroad is still too often forgotten, 
and the lasting contribution they can make to our private sector at 
home is still too often unfulfilled. The proposed hiring benchmark, 
therefore, is a tool to address this pressing national issue and the 
important role Federal contractors have in addressing it.
    The purposes and intentions of the benchmark proposal made clear, 
we turn to the concerns raised by commenters.
    Five commenters stated that the proposed benchmarks were the 
equivalent of a ``quota.'' One commenter stated that the benchmark 
requirement would make contractors feel the need to meet the data 
requirements by hiring protected veterans who may not be qualified in 
order to meet the benchmark. Another believed the benchmarks suggested 
``quotas'' because the availability analysis factors proposed do not 
factor in the approximate percentage of qualified protected veterans by 
occupational codes or geographical areas. Still another asserted that 
the proposed benchmarks were ``quotas'' and thus unconstitutional, as 
they were not ``narrowly tailored'' to ``a compelling governmental 
interest.''
    The proposed benchmarks are not quotas and should not be conceived 
as quotas. The benchmark is not a rigid and inflexible quota which must 
be met, nor is it to be considered either a ceiling or a floor for the 
employment of particular groups. Quotas are expressly forbidden. We 
hope the discussion in the previous paragraphs clarifying that 
contractors have significant flexibility to set their own benchmarks, 
and will not be cited for violations solely for failing to meet the 
benchmarks they set, allay the fears of these commenters. Further, the 
omission of breaking down the benchmarks by occupational codes or 
geographical areas is merely a function of the fact that such data does 
not exist for protected veterans; it does not evince an intent to set 
rigid quotas. Finally, we note that the legal standard raised by the 
final commenter regarding the constitutionality of the benchmarks is 
incorrect. The ``narrowly tailored to a compelling governmental 
interest'' standard, otherwise known as ``strict scrutiny,'' is applied 
to race-based decision making. See Adarand Constructors, Inc. v. Pena, 
515 U.S. 200 (1996). The benchmarks proposed in the VEVRAA regulations 
are not race-based. Classifications that are based on veteran status 
are subject to so-called ``rational basis review,'' and are legally 
permissible so long as the government action--in this case, the setting 
of benchmarks--is ``rationally related'' to a ``legitimate governmental 
interest.'' See, e.g., Sturgell v. Creasy, 640 F.2d 843, 852 (6th Cir. 
1981). Clearly, requiring contractors to set benchmarks for the hiring 
of protected veterans--particularly benchmarks that afford the 
contractor significant flexibility in their establishment and are not 
rigidly applied so as to automatically create a violation of the law if 
they are not met--is rationally related to the legitimate governmental 
interest of increasing outreach to and employment opportunities for 
protected veterans.
    Six commenters, including individuals, contractor associations, 
consultants, and human resource management firms, expressed concern 
that requiring contractors to establish annual hiring benchmarks for 
protected veterans would adversely impact women and minorities, and 
thus impede

[[Page 58639]]

contractors' nondiscrimination efforts under EO 11246, due to low 
numbers of minorities and women among protected veterans. One commenter 
asked for clarity on whether contractor veteran affirmative action 
efforts could be used as an affirmative defense if those efforts result 
in adverse impact against women, because a large percentage of 
protected veterans are men. Finally, a commenter asked whether OFCCP 
would still require contractors to establish annual hiring benchmarks 
for protected veterans if women and minorities were underutilized. 
OFCCP does not agree that contractor-established benchmarks will 
adversely affect women or minorities. As an initial matter, recent 
Department of Veterans Affairs (DVA) data indicate that for Gulf War-
era I veterans 30.3 percent were minority; Gulf War-era II veterans 
33.6 percent were minority; and Vietnam era veterans 16.4 percent were 
minority.\21\ This compares quite closely with the 27 percent national 
non-white population figure calculated by recent Census data.\22\ For 
this reason alone we do not anticipate any potential effect on 
minorities. Although the representation of women among veterans is 
lower than in the civilian labor force, as discussed in more detail 
below, the employment of women will not be adversely affected by VEVRAA 
affirmative action requirements.
---------------------------------------------------------------------------

    \21\ U.S. Department of Veteran Affairs, National Center for 
Veterans Analysis and Statistics, ``Minority Veterans 2011,'' May 
2013, http:[sol][sol]www.va.gov/vetdata/docs/SpecialReports/
Minority_Veterans_2011.pdf (last accessed Aug. 15, 2013).
    \22\ U.S. Census Bureau, Overview of Race and Hispanic 
Origin:2010, Table 1: Population by Hispanic or Latino Origin and by 
Race for the United States: 2000 and 2010, Mar. 11, 2011, 
http:[sol][sol]www.census.gov/prod/cen2010/briefs/c2010br-02.pdf 
(last accessed Aug. 15, 2013).
---------------------------------------------------------------------------

    The purpose of, and requirements related to, VEVRAA benchmarks do 
not serve to impact the hiring of women or minorities. The purpose of 
VEVRAA hiring benchmarks is simply to provide the contractor a 
quantifiable means to measure its progress towards achieving equal 
employment opportunity for protected veterans. The contractor's 
obligation under Sec.  60-300.45 is to establish a benchmark and 
document that it has done so. Contractors will not be subject to an 
enforcement action or found to be in violation of the VEVRAA 
regulations for failing to meet the benchmark. Hiring preferences are 
not required, the rule does not state that contractors will be expected 
to achieve benchmarks, and the VEVRAA rule does not prescribe actions 
the contractor must take if the benchmark is not achieved. The 
benchmark simply provides the contractor a tool to measure its progress 
in employing protected veterans. Consequently, the VEVRAA enforcement 
scheme does not provide an incentive for contractors to disfavor non-
protected veterans in employment. The point of the benchmark is to 
encourage contractors to be inclusive of protected veterans rather than 
to discriminate against nonveterans through preferences or quotas.
    OFCCP sees no reason why a contractor's VEVRAA obligations would 
affect its nondiscrimination obligations under EO 11246 or Title VII. 
VEVRAA does not require hiring preferences or veteran quotas. Because 
contractors are not required to meet the VEVRAA benchmark, efforts by 
contractors to do so would not be a defense to a charge of employment 
discrimination, including adverse impact, under another law. Further, a 
contractor's obligations under other civil rights laws will not create 
a violation of VEVRAA. To avoid this problem Sec.  60-300.1(c)(2) 
provides that it may be a defense to a charge of violation of VEVRAA 
regulations that a challenged action is required or necessitated by 
another Federal law or regulation, or that another Federal law or 
regulation prohibits an action that would be required by VEVRAA.
    Finally, in response to the question about whether a contractor 
will need to establish a VEVRAA hiring benchmark regardless of its 
utilization of women and minorities, the answer is yes. The VEVRAA 
benchmark is to be established annually regardless of the contractor's 
utilization of any group of employees, including protected veterans. 
The hiring benchmark is simply a tool to allow contractors to measure 
their progress in providing equal opportunity to protected veterans.
    A number of commenters objected to the proposed benchmarks on the 
grounds that the data upon which the contractors are required to rely 
generally is structurally incompatible with the contractor's workplace. 
For instance, one commenter asserted that it opposes hiring benchmarks 
because the metrics outlined in the proposal have no relationship at 
all to the population of qualified candidates eligible for employment. 
Additionally, an organization argued that just because there may be a 
high availability of veterans in a specific location, does not mean 
those same veterans are qualified for the types of jobs available in 
that same location. Furthermore, commenters in opposition to the 
proposed rule argued that the benchmark proposal is flawed because it 
contemplates facility-wide goals. Another organization explains that 
placement goals for an accounting firm will look very different than 
the placement goals for a manufacturing company, and the placement 
goals for entry-level production positions at the manufacturing company 
will look very different than the placement goals for management 
positions at the same company.
    These comments are well-taken, and we submit that some of these 
issues are precisely why the benchmarks we proposed allowed the 
contractor such a significant amount of flexibility in creating them. 
This would allow, for instance, an accounting firm and a manufacturing 
firm in the same city to have different hiring benchmarks, depending on 
the types of positions available and the skill sets required for these 
positions. The decision to have the regulation require the contractor 
to create facility-wide benchmarks rather than goals tied to particular 
job codes or titles is dictated by the limited scope of the veteran 
data available.
    A substantial number of commenters objected to the proposed 
benchmarks on the grounds that the specific categories of data which 
the contractors are required to consider are not specific to protected 
veterans, and otherwise do not provide clear guidance to contractors on 
how to arrive at an overall benchmark. With regard to the BLS data 
specified in paragraph (b)(1), commenters argued that relying on such 
data would inflate benchmarks because data collected by BLS and state 
employment services reflects all veterans in the civilian labor force--
not just protected veterans, and that such data would be based on the 
entire state rather than a more narrow recruitment area. With regard to 
the VETS data specified in paragraph (b)(2), commenters contended that 
this statewide data would have limited relevance to the recruiting that 
occurs in most companies because contractors may recruit from a very 
local market for some positions and may recruit on a national basis for 
other positions. Additionally, commenters argued that to the extent 
contractors are required to rely on statewide data to inform localized 
hiring benchmarks, there are no assurances the statewide data is an 
accurate reflection of the composition of protected veterans in the 
subject locale. Regarding consideration of the contractor's own 
referral, applicant and hiring data of protected veterans in paragraph 
(b)(3), commenters generally questioned the reliability of the data, 
specifically the referral and applicant data, for reasons that have 
been

[[Page 58640]]

thoroughly addressed in previous sections.
    In response to the comments on the proposed data considerations in 
paragraphs (b)(1) and (b)(2), as previously discussed, OFCCP agrees 
that precise and statistically meaningful availability data 
specifically capturing veterans protected under VEVRAA at the local 
level, divided by job group, would be optimal in setting specific, 
refined goals. However, such data does not exist. Accordingly, the 
proposal had contractors consider a variety of sources of data 
capturing large portions of the relevant population (including actual 
applicant flow and hiring data from the contractor's establishment), 
and provided contractors with the flexibility, in the proposed 
paragraphs (b)(4) and (b)(5), to take into account any other factors 
which could reasonably affect protected veteran availability. However, 
commenters also asserted that paragraphs (b)(4) and (b)(5) were 
unhelpfully vague and introduced a high degree of subjectivity into the 
entirety of the benchmark setting process that was uncomfortable. 
Multiple commenters suggested alternative methods for setting 
benchmarks, including a nationwide goal for hiring protected veterans. 
One commenter in particular, a consultant to contractors on EEO issues, 
proposed a mechanism by which aggregate annual VETS-100A data could be 
used to estimate the number of protected veterans in the civilian 
workforce, and by dividing this number by the total civilian workforce, 
arrive at a national goal for protected veterans.
    OFCCP does not believe that VETS-100 data, as currently collected 
and reported, is an appropriate source for establishing benchmarks. 
However, should the VETS data collection and reporting structures 
change in the future, the VETS 100-A data may be a source contractors 
could use when establishing their own benchmarks or that is considered 
by OFCCP should it revise the national benchmark. First, the structure 
of the VETS-100 form is such that contractors do not record a total 
number of protected veteran employees or hires, but rather how many 
veterans fall within each of the four protected categories. Because a 
veteran may fall within multiple categories (e.g., a disabled veteran 
who is also recently separated and earned a campaign badge for his or 
her service), VETS-100 data can double, triple, or even quadruple-count 
the number of protected veteran hires and employees. Also, VETS-100 
data only reflects those protected veterans employed by Federal 
contractors, and not the population of protected veterans available for 
work. Accordingly, if a contractor's protected veteran recruitment 
efforts were deficient and resulted in an unreasonably small number of 
protected veteran hires and employees, this deficiency would therefore 
be incorporated into the contractor's benchmark.
    However, in order to address the concerns of those commenters 
seeking greater clarity and objectivity in setting hiring benchmarks, 
the final rule contains a significant revision allowing contractors 
another method for establishing a hiring benchmark: simply using the 
national percentage of veterans in the civilian labor force, which will 
be published and updated annually on OFCCP's Web site, as the annual 
hiring benchmark. As of September 2011, the national percentage of 
veterans in the civilian labor force was 8.0 percent. OFCCP recognizes 
that this data captures all veterans, and not just veterans protected 
by VEVRAA, but OFCCP reiterates that the benchmark is not a quota. It 
serves primarily as a yardstick by which contractors can measure the 
effectiveness of their affirmative action efforts, and a tool for 
contractors to use in the evaluation of their outreach and recruitment 
efforts. Importantly, as with benchmarks calculated under the five-
factor method set forth in the NPRM, contractors will not be cited 
simply for failing to meet it. For those commenters who asserted that 
the proposed five-factor approach to setting benchmarks was unduly 
burdensome, this approach will decrease the burden significantly, as 
set forth in the Regulatory Procedures section of this final rule.
    For those contractors that would rather use the five-factor 
approach to setting benchmarks proposed in the NPRM, the final rule 
retains this as an option. This option, however, is modified slightly 
to eliminate the consideration of referral data, which contractors are 
no longer required to collect and maintain in the final rule. For those 
who choose this method of setting benchmarks, OFCCP will provide 
technical assistance to contractors upon request.
    With regard to commenters' concerns about the proposed five-year 
recordkeeping requirement in paragraph (c) of this section, the final 
rule reduces this to a three-year requirement, for the reasons set 
forth in the discussion of Sec.  60-300.80 below and previous sections 
that had a proposed five-year recordkeeping requirement discussed 
above.
    Some commenters questioned why the term ``benchmarks'' was used in 
this section as opposed to the term ``goals'' which is used in the EO 
11246 program. We proposed a different term to avoid confusion and to 
highlight the difference in how the two concepts operate. The purposes 
of the EO 11246 placement goals are twofold: (1) ``to serve as 
objectives or targets reasonably attainable by means of applying every 
good faith effort to make all aspects of the entire affirmative action 
program work'' and (2) ``to measure progress toward achieving equal 
employment opportunity.'' 41 CFR 60-2.16(a). The benchmarks established 
under this regulation are intended to serve only the second of these 
two objectives, that is, they serve as a measure of progress and the 
effectiveness of a contractor's outreach and recruitment efforts. The 
Executive Order regulations state goals are ``reasonably attainable'' 
when sufficiently robust data exists describing the availability of 
women and minority workers, the groups for which goals may be 
established under the Executive Order program. As discussed previously 
in this section, however, we do not believe that the data currently 
available is sufficiently robust on the issue of the availability of 
protected veterans. Consequently, the purpose and function of goals 
established in the Executive Order regulations differ from benchmarks 
under the VEVRAA regulations. Therefore, we use different terminology 
to distinguish the terms clearly. To further clarify this difference, 
the final rule slightly revises the language in paragraph (b) of this 
section. The proposal defined hiring benchmarks as ``the percentage of 
total hires that are protected veterans that the contractor will seek 
to hire. . . .'' The final rule deletes the clause ``that the 
contractor will seek to hire'' from the text of paragraph (b) given the 
explanation above.
    Finally, one commenter asked if the annual hiring benchmark it sets 
should be included in the text of the AAP or maintained on-site in the 
event of an OFCCP audit. It is OFCCP's position that annual hiring 
benchmarks should be included in both the text of the AAP and 
maintained on-site in the event of an OFCCP audit, for maximum 
transparency.
Subpart D--General Enforcement and Complaint Procedures
Section 60-300.60 Compliance evaluations
    The proposed rule set forth several changes to the process the 
contractor and OFCCP will follow in conducting compliance evaluations. 
These proposals, the comments to these

[[Page 58641]]

proposals, and the revisions made to the final rule are discussed in 
turn below.
     Paragraph (a)(1): Review of personnel processes
    The NPRM added a sentence to paragraph (a)(1)(i) regarding the 
temporal scope of desk audits performed by OFCCP, stating that OFCCP 
``may extend the temporal scope of the desk audit beyond that set forth 
in the scheduling letter if OFCCP deems it necessary to carry out its 
investigation of potential violations of this part.'' Several 
commenters, including those from individuals, contractors, contractor 
associations, and law firms, objected to this proposed change and asked 
that it be withdrawn. These commenters asserted that the language of 
the proposed rule could result in ``never-ending'' audits for 
contractors, was contrary to a 2010 Administrative Law Judge (ALJ) 
decision in the case OFCCP v. Frito-Lay and would lead to an increased 
burden for contractors.
    As stated in the NPRM, the purpose of this proposal was to clarify 
that OFCCP may need to examine information after the date of the 
scheduling letter during the desk audit in order to determine, for 
instance, if violations are continuing or have been remedied. While the 
existing VEVRAA provision addresses the authority of the agency to 
conduct desk audits, it does not expressly state the temporal scope of 
these audits. It has been OFCCP's longstanding position that the agency 
has authority to obtain information pertinent to the review for periods 
after the date of the letter scheduling the review, including during 
the desk audit. However, in 2010 an ALJ disagreed in a recommended 
decision in the Frito-Lay case, in part because the parallel Executive 
Order 11246 desk audit regulation at issue in the case does not address 
the temporal scope of a desk audit. OFCCP v. Frito-Lay, Inc., Case No. 
2010-OFC-00002, ALJ Recommended Decision and Order (July 23, 2010). On 
May 8, 2012, the Department's Administrative Review Board (ARB) 
reversed this recommended decision, concluding that a desk audit 
authorized by the regulation permitted OFCCP to request additional 
information relating to periods after the scheduling letter. The ARB 
concluded that the regulation does not have an inflexible temporal 
limitation. OFCCP v. Frito-Lay, Inc., Case No. 2010-OFC-00002, ARB 
Final Administrative Order (May 8, 2012). OFCCP views the Frito-Lay 
decision as equally applicable to desk audits concluded under its 
VEVRAA authority as to those conducted under its EO 11246 authority. 
Nevertheless, the final rule makes the clarification explicit in the 
text of the regulation. OFCCP notes that paragraph (a)(1) also 
authorizes OFCCP to request during the desk audit additional 
information pertinent to the review after reviewing the initial 
submission. See United Space Alliance v. Solis, 824 F.Supp.2d 68, 81-82 
(D.D.C. 2011) (holding that agency's interpretation of its desk audit 
regulation to authorize additional information requests when necessary 
was entitled to deference).
    Finally, commenters' concerns that this revision will lead to 
``never-ending'' audits are inapposite. As stated above, the clarifying 
language set forth in the final rule does not change OFCCP's 
longstanding policy, or contractors' obligations, regarding the 
temporal scope of the desk audit. Further, because the clarification 
does not represent a change, concerns about increases in burden are 
similarly unfounded.
     Paragraph (a)(2): Off-site review of records
    The NPRM sought to correct an error in the existing regulations in 
this paragraph, changing the reference to the ``requirements of the 
Executive Order'' to the ``requirements of Section 4212.'' We received 
no comments on this proposed change, but in light of the discussion of 
Sec.  60-300.2 above, we replace the reference to ``Section 4212'' with 
``VEVRAA.''
     Paragraph (a)(3) and (a)(4): Nature of document production 
and scope of focused reviews
    The NPRM revised these two paragraphs to allow OFCCP to review 
documents pursuant to a compliance check and conduct focused reviews 
either on-site or off-site, at OFCCP's option. We received no comments 
on these specific paragraphs, and thus adopt the proposed language into 
the final rule as written.
     Paragraph (d): Pre-award compliance evaluation
    Finally, the proposed rule added a new paragraph (d) to this 
section detailing a new procedure for pre-award compliance evaluations 
under VEVRAA, much like the procedure that currently exists in the 
Executive Order regulations (see 41 CFR 60-1.20(d)). We received one 
comment on this proposal that supported adding pre-award compliance 
evaluation options. Accordingly, this paragraph is adopted into the 
final rule as proposed.
Subpart E--Ancillary Matters
Section 60-300.80 Recordkeeping
    Section 60-300.80 describes the recordkeeping requirements that 
apply to contractors under VEVRAA. The NPRM proposed adding a sentence 
at the end of paragraph (a) of this section clarifying that the newly 
proposed recordkeeping requirements set forth in Sec. Sec.  60-
300.44(f)(4) (linkage agreements and other outreach and recruiting 
efforts), 60-300.44(k) (collection of referral, applicant and hire 
data), 60-300.45(c) (criteria and conclusions regarding contractor 
established hiring benchmarks), and paragraph 5 of the EO Clause in 
Sec.  60-300.5(a) (referral data) must be maintained for five years. 
OFCCP received twenty-four comments on the proposed provision from an 
individual, contractors, associations representing veterans or 
individuals with disabilities, law firms, industry groups, and human 
resources consulting firms. Twenty-three of the commenters opposed the 
new requirement, citing burden and inconsistency with existing 
regulations.
    In response to comments regarding the burden associated with 
maintaining records for five years, the final rule reduces the 
recordkeeping requirements for Sec. Sec.  60-300.44(f)(4), 60-
300.44(k), and 60-300.45(c) to three years. The final rule also 
eliminates the recordkeeping requirements for referral data under the 
proposed paragraph 5 of the EO Clause and Sec.  60-300.44(k). The 
comments regarding the burden associated with the proposed revisions 
and OFCCP's response are discussed in further detail in the Regulatory 
Procedures section.
    Commenters also expressed the view that all of the VEVRAA 
recordkeeping requirements should be consistent with EO 11246, section 
503, and other laws that have recordkeeping obligations. Nearly all 
commenters believed the difference in timeframes would lead to 
confusion, and ultimately non-compliance, even for the most well-
intentioned contractors. One comment asserted that the proposed 
provision is inconsistent with State laws that require employers to 
destroy personal information of job seekers after two years when 
records contain personal information. Several comments indicated that 
the proposed requirement contradicts the Internet Applicant rule, which 
sets forth certain requirements for applications received through the 
internet or related electronic data technologies.
    In response to these comments, the final rule includes a three-year 
recordkeeping requirement, rather than the proposed five-year 
requirement, for Sec. Sec.  60-300.44(f)(4), 60-300.44(k), and 60-
300.45(c). In order to clearly indicate this, the final rule includes a 
new paragraph (b) specifying those records that have the three-year 
requirement, moving paragraphs (b) and (c) in the

[[Page 58642]]

existing rule to paragraphs (c) and (d), respectively. OFCCP feels 
strongly that extending the recordkeeping requirements for these 
particular provisions, all primarily related to recruitment and 
outreach, will enable contractors to better determine the effectiveness 
of their recruitment and outreach activities over time. As noted in the 
NPRM, the absence of data makes it nearly impossible for contractors 
and OFCCP to perform even rudimentary evaluations of the availability 
of protected veterans in the workforce, or to make any quantitative 
assessments of how effective contractor outreach and recruitment 
efforts have been in attracting protected veteran candidates. These 
records will give contactors historical data that can be used for 
analyzing their compliance efforts. As to conflicts with other laws, 
particularly the Internet Applicant Rule, as set forth in detail in the 
discussion of Sec.  60-300.42(a), the final rule harmonizes its 
requirements with the Internet Applicant Rule in the EO 11246 
regulations. With regard to the comment vaguely referencing State law 
conflicts, generally speaking, State laws have provisions that 
acknowledge Federal preemption if there is a conflict, and thus we see 
no reason to change the proposal on that basis.
    Commenters were particularly concerned about retaining referral 
data for five years under paragraph 5 of the EO Clause and Sec.  60-
300.44(k). As discussed previously, the final rule eliminates the 
recordkeeping requirements for referral data, eliminating this concern.
Section 60-300.81 Access to records
    The NPRM made two changes to the current regulation. First, it 
added a sentence requiring the contractor to provide off-site access to 
materials if requested by OFCCP investigators or officials as part of 
an evaluation or investigation. Second, it required that the contractor 
specify to OFCCP all formats (including specific electronic formats) in 
which its records are available, and produce records to OFCCP in the 
formats selected by OFCCP. OFCCP received seven comments regarding the 
proposed Sec.  60-300.81. All seven comments opposed the proposed 
changes, citing confidentiality and burden concerns.
    Commenters expressed concerns about providing records in a format 
requested by OFCCP. Two commenters requested clarification regarding 
whether OFCCP will require contractors to convert records into formats 
requested by the agency. Several commenters stated that contractors 
should have the discretion to determine the format that is most 
efficient for records production based on organizational resources and 
sensitivity of information.
    The final rule clarifies the provision regarding OFCCP's ability to 
request records in specific formats. The final rule states that: 
``[t]he contractor must provide records and other information in any of 
the formats in which they are maintained, as selected by OFCCP.'' The 
final rule language makes clear that the provision will not require 
contractors to invest time or resources creating records in a specific 
format, or to create a documented ``list'' of the formats in which they 
have documents available. Rather, contractors merely need to inform 
OFCCP of the formats in which they maintain their records and other 
information, and allow OFCCP to select the format(s) in which the 
records or information will be provided. This provision should result 
in more efficient OFCCP investigations.
    Commenters also criticized the proposal to allow OFCCP access to 
records off-site, particularly as it relates to the security of 
confidential records. One comment identified an alleged incident where 
an OFCCP Compliance Officer lost contractor information during a 
compliance evaluation. In light of this alleged security breach, the 
comment suggested that contractors should be permitted to determine how 
records are produced to OFCCP. This commenter did not provide further 
details of the incident, and OFCCP is unaware of any specific incident 
such as the one described. Another commenter noted that the language 
could be interpreted broadly to permit others outside of OFCCP to gain 
access to vendor data. Yet another comment stated that it may be 
difficult and time-consuming for contractors to make data accessible to 
OFCCP off-site.
    In order to address the above-referenced concerns, commenters 
provided several recommendations to modify the proposed language of 
this section. One comment recommended that OFCCP clarify that the 
agency is the only entity that may be permitted access to information 
submitted. Another commenter recommended including language in the 
final regulation that states that OFCCP is committed to the 
confidentiality of contractor information and that confidential 
information related to individual employees is not subject to Freedom 
of Information Act requests.
    The final rule retains the proposed requirement to provide OFCCP 
off-site access to materials by request. As an initial matter, it is 
worth noting that access to company records off-site is not a novel 
approach, as the Executive Order contains no limitation on the location 
of access for the compliance evaluation, and indeed specifically 
references off-site access. Thus, this general access regulation 
conforms to those principles. In light of contractors' increased use of 
electronic records in multiple locations, OFCCP feels that this change 
will provide the agency greater flexibility during evaluations and 
investigations. However, OFCCP modified Sec.  60-300.81 of the final 
rule in response to comments regarding record confidentiality. Section 
60-300.81 now includes the following language: ``OFCCP will treat 
records provided by the contractor to OFCCP under this section as 
confidential to the maximum extent the information is exempt from 
public disclosure under the Freedom of Information Act, 5 U.S.C. 552.'' 
It is the practice of OFCCP not to release data where the contractor is 
still in business, and the contractor indicates, and through the 
Department of Labor review process it is determined, that the data are 
confidential and sensitive and that release of the data would subject 
the contractor to commercial harm. This language affirms OFCCP's 
commitment to ensure confidentiality to the fullest extent allowed by 
law. Further, all OFCCP Compliance Officers receive training on the 
importance of keeping records confidential during compliance 
evaluations and complaint investigations. OFCCP will continue to stress 
this policy to ensure that contractor records are kept secure by the 
agency at all times, and will work with contractors to respond to 
specific data confidentiality concerns they may have.
Appendix A to Part 60-300--Guidelines on a Contractor's Duty To Provide 
Reasonable Accommodation
    The proposed rule included three changes to Appendix A which would 
mandate activities that previously were only suggested. First, in the 
third sentence of paragraph 2 and the fourth sentence of paragraph 5, 
we proposed changing the language to reflect the change to Sec.  60-
300.42(d) requiring a contractor to seek the advice of disabled 
veterans in providing reasonable accommodation. Second, in the last 
sentence of paragraph 4, the NPRM proposed requiring that disabled 
veterans, in the event an accommodation would constitute an undue 
hardship for the contractor, be given the option of providing the 
accommodation or paying the portion of the cost that constitutes the 
undue hardship for the contractor, consistent with the change to Sec.  
60-300.21(f)(3).

[[Page 58643]]

Finally, in the last sentence of paragraph 9, the proposed rule is 
changed to require that a contractor must consider the totality of the 
circumstances when determining what constitutes a ``reasonable amount 
of time'' in the context of available vacant positions.
    Comments describing concerns with the first and second proposed 
changes were addressed in the discussion of Sec. Sec.  60-300.42(d) and 
60-300.21(f)(3), respectively. We received no comments on the third 
proposed change. Accordingly, Appendix A is incorporated into the final 
rule as proposed, with small changes to update the references to 
specific accommodations to reflect current technology and terminology 
(such as replacing the reference to ``telecommunication devices for the 
deaf (TDD)'' to the more current ``text telephones (TTYs),'' and 
including modern technology such as speech activated software, and as 
set forth in the discussion of paragraph 9 of the EO Clause in Sec.  
60-300.5. Consistent with the change to Sec.  60-300.42(c), we also 
deleted the words ``and wish to benefit under the contractor's 
affirmative action program'' from paragraph 1.
Appendix B to Part 60-300--Sample Invitation to Self-Identify
    The proposed rule amends Appendix B consistent with the proposed 
changes to the self-identification regulation found at Sec.  60-300.42. 
The majority of comments pertaining to aspects of Appendix B were 
addressed in the discussion of Sec.  60-300.42 above. Separately, three 
commenters stated specifically that the proposed Appendix B would be a 
useful tool for contractors. One commenter stated that OFCCP should 
make clear that a goal of a reasonable accommodation is to enable an 
individual with a disability ``to perform the essential functions of 
the job,'' as this is the accepted legal standard, while the proposed 
paragraph 2 of Appendix B uses ``to perform the job properly and 
safely.'' OFCCP adopts this commenter's language into the final rule. 
OFCCP also eliminates from paragraph 2 of the sample invitation to 
self-identify the option to ``choose not to provide this information.'' 
This option may serve to discourage applicants from self-identifying, 
and is unnecessary, as applicants who wish not to reveal their 
protected veteran status may simply choose not to respond to the 
invitation. Consistent with the change to Sec.  60-300.42(c), paragraph 
3 is deleted, and paragraphs 4, 5, and 6 are renumbered, accordingly, 
as paragraphs 3, 4, and 5. In addition, to address confusion among 
veterans regarding the scope of the protections afforded by the various 
veterans' employment rights statutes, the final rule adds clarifying 
language to paragraph 1 of Appendix B. The new language explains that 
protected veterans with past, present or future military service, 
status or obligations may have additional rights under USERRA, 
including the right to be reemployed by an employer for whom they 
worked immediately prior to their military service.
Appendix C--Review of Personnel Processes
    The NPRM proposed eliminating Appendix C and incorporating relevant 
parts of it into Sec.  60-300.44(b). However, as stated in the 
discussion of Sec.  60-300.44(b), we have eliminated the proposal in 
the NPRM that required specific personnel process reviews. Accordingly, 
the final rule reinstates Appendix C, but substitutes the updated term 
``protected veteran'' in paragraphs 1, 2, and 3, in place of ``disabled 
veteran, recently separated veteran, other protected veteran, or Armed 
Forces service medal veteran.''

Regulatory Procedures

Executive Order 12866 (Regulatory Planning and Review) and Executive 
Order 13563 (Improving Regulation and Regulatory Review)

    OFCCP is issuing this final rule in conformity with Executive 
Orders 13563 and 12866, which direct agencies to assess all costs and 
benefits of available regulatory alternatives and, if regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety 
effects, distributive impacts, and equity). Executive Order 13563 
emphasizes the importance of quantifying both costs and benefits, of 
reducing costs, of harmonizing rules, and of promoting flexibility.
    This rule is economically significant and major as it will have an 
annual effect on the economy of $100 million or more. EO 12866 Sec.  
3(f). OFCCP estimates that first year costs in the rule to be in the 
range of $177,296,772 to $483,560,138. This includes (1) One-time 
costs; (2) recurring costs; (3) capital start-up costs; and (4) 
operations and maintenance costs.\23\ The range of recurring costs of 
the final rule in subsequent years will be approximately $120,386,058 
to $347,617,359.\24\ This rule was reviewed by the Office of Management 
and Budget.
---------------------------------------------------------------------------

    \23\ These costs include both establishment and contractor 
company level costs.
    \24\ The recurring costs include those related to the recurring 
substantive provisions and the copying costs identified in the 
Operations and Maintenance Costs section.
---------------------------------------------------------------------------

A. Introduction
    The final regulatory impact analysis is substantially different 
from the preliminary regulatory impact analysis presented in the VEVRAA 
NPRM based on comments received during the public and interagency 
comment period. First, the final rule has been scaled down 
significantly in order to minimize the costs employers would incur 
under the rule. Second, OFCCP modified the contractor establishment 
count to more accurately reflect the number of contractors that would 
be impacted by the rule. Third, the analysis acknowledges that some 
establishments and or companies may incur higher costs under the final 
rule and illustrates a range of costs to implement several provisions.
1. Eliminated Several Provisions in the NPRM
    While all the proposals in the NPRM had value, after assessing the 
comments received on the NPRM published on April 26, 2011, we made 
several changes in the final rule. OFCCP reconsidered whether the cost 
of several proposals in the NPRM could be justified by their potential 
benefits, and whether alternative methods or approaches could achieve 
comparable or acceptable benefits for less cost or burden. We retain in 
the final rule those provisions proposed in the NPRM that create 
greater contractor accountability through enhanced data collection and 
recordkeeping. Therefore, as an example, the final rule does not 
require each contractor to establish three ``linkage'' agreements with 
various veteran service organizations to facilitate recruitment.
    Other examples of how the final rule takes a tailored approach 
include, but are not limited to, eliminating the proposal that 
contractors reproduce the entire equal opportunity clause in all 
contracts and subcontracts; the proposal that contractor staff training 
must cover a list of specific training items; the proposal to mandate 
annual reviews of personnel policies; and the proposal to mandate that 
contractors identify the official responsible for the affirmative 
action program on all communications are also eliminated in the final 
rule.
2. Increased the Contractor Establishment Count
    In light of the comments concerning the size of the Federal 
contractor

[[Page 58644]]

establishment universe, OFCCP reexamined the original number of 108,288 
contractor establishments it used in the NPRM. For the final rule, we 
combined Equal Employment Data System (EEDS) data with several other 
information sources.\25\ We used FY 2009 EEDS data to determine the 
number of Federal contractor establishments with 50 or more employees; 
this resulted in a total of 87,013 Federal contractor 
establishments.\26\ An additional 10,518 establishments were identified 
through a cross-check of other contractor databases for a total of 
97,531 establishments. Covered Federal contractors must develop AAPs 
for all of their establishments, even those with fewer than 50 
employees. Therefore, OFCCP added an additional 73,744 establishments, 
using EEO-1 and FPDS data, for an adjusted total of 171,275 Federal 
contractor establishments affected by the final rule. This adjustment 
to the methodology for calculating the number of contractors and 
contractor establishments results in a 58 percent increase over the 
earlier estimate used in the NPRM.
---------------------------------------------------------------------------

    \25\ OFCCP determined that the VETS-100 database is not the most 
appropriate resource for calculating the number of federal 
contractors and contractor establishments. Among the concerns 
surrounding this data source are the use of contractor established 
12-month reporting timeframes, the degree to which there is overlap 
or duplication in the VETS-100 and VETS-100A reports, and the 
absence of an employee threshold for reporting purposes.
    \26\ A single firm, business, or ``entity'' may have multiple 
establishments or facilities. Thus, the number of contractor 
establishments or facilities is significantly greater than the 
number of parent contractor firms or companies.
---------------------------------------------------------------------------

    We received comments on the estimated number of contractor 
establishments as well, including recommending an establishment count 
of 285,390 using the VETS annual report. While OFCCP declines to 
exclusively rely on the VETS report number, we present an estimated 
high end for the range of the cost of the rule based on a contractor 
establishment number of 251,300 for comparison. This number is based on 
2010 VETS data from their pending Information Collection Request.\27\
---------------------------------------------------------------------------

    \27\ OMB Control Number 1293-0005, Federal Contractor Veterans' 
Employment Report, VETS-100/VETS-100A, http://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=201104-1293-003 (last accessed 
Aug. 13, 2013).
---------------------------------------------------------------------------

    All costs and hours in the burden analysis of this final rule are 
calculated using adjusted numbers of Federal contractor establishments. 
Federally assisted construction contractors are not subject to these 
regulations and, therefore, are not included in this total. See section 
60-300.2(n) for the definition of ``Government contract.''
3. Revised and Increased Burden Estimates
    OFCCP received 55 comments concerning overall burden hours from 
several employer groups and employers, including 21 form letters. Most 
stated that OFCCP's overall estimate of dollars and hours was much too 
low. Some commenters included estimates of their own for dollar costs 
and burden hours. Several commenters specifically expressed concern 
about the potential burden on smaller contractors, including smaller 
construction contractors, veteran owned businesses, and service-
disabled veteran owned businesses.
    OFCCP acknowledges that estimating the precise amount of time each 
company will take to engage in certain activities will be difficult. 
However in response to public comments, the final regulatory impact 
analysis attempts to account for the fact that smaller contractors may 
not have the same human resources capabilities as larger contractors. 
Specifically, OFCCP has provided low and high range estimates for 
certain requirements either based on the comparison of contractor 
establishment numbers, assumptions about the use of automated 
application systems and human resources information systems,\28\ and/or 
other factors.
---------------------------------------------------------------------------

    \28\ The human resources system low range estimates assume that 
most contractors have automated application systems and human 
resources information systems to meet the data collection 
requirements of the final rule. The high range estimate is based on 
the assumption that contractors with 50-100 employees may still use 
manual application or human resources processes. These contractors 
would likely expend more time conducting the kind of data collection 
and analysis required under the final rule.
---------------------------------------------------------------------------

B. The Need for the Regulation
    Some commenters stated that OFCCP did not adhere to the 
requirements of Executive Order 13563 or Executive Order 12866, which 
require Federal agencies to identify a specific need for any regulation 
they promulgate. These commenters asserted that the unemployment rate 
for veterans was an insufficient basis for such ``extensive 
regulations.'' Another commenter questioned the need for new 
regulations and asserted that better enforcement of the current 
regulations would achieve the same goals. Commenters further stated 
that the anticipated benefits did not outweigh the overall costs of the 
NPRM.
    The current regulations are simply not sufficient to facilitate the 
process of connecting veteran job-seekers with Federal contractors 
seeking to hire qualified employees. The framework articulating a 
contractor's responsibilities with respect to affirmative action, 
recruitment, and placement of veterans has remained largely unchanged 
since the VEVRAA implementing rules were first published in 1976. 
Meanwhile, veterans are returning from tours of duty in Iraq, 
Afghanistan, and other places around the world. These veterans possess 
skills and personal qualities that are highly sought after in the job 
market. However, veterans face substantial obstacles in finding 
employment upon leaving the service and returning home. Addressing the 
barriers our veterans face upon returning to civilian life is the focus 
of a number of Federal efforts, including these revised VEVRAA 
regulations.
    Although progress has been made in the employment of veterans, the 
number of unemployed veterans still remains too high, and substantial 
disparities in unemployment and pay rates continue to persist, 
especially for some categories of veterans. Annual unemployment rate 
for post-September 2001 veterans, referred to as ``Gulf War-era II 
veterans,'' is higher than the rates for all veterans and for non-
veterans. In 2012, according to BLS data on the employment situation of 
veterans for that year, about 2.6 million of the nation's veterans had 
served during Gulf War era II. The unemployment rate for this category 
of veterans was 9.9 percent compared to nonveterans at 7.9 percent.\29\ 
In this same year, the unemployment rate for male Gulf War-era II 
veterans age 18 to 24 was 20.0 percent, higher than the rate for 
nonveterans of the same age group (16.4 percent).
---------------------------------------------------------------------------

    \29\ U.S. Bureau of Labor Statistics, Economic News Release: 
Employment Situation of Veterans Summary, Table A: Employment status 
of the civilian noninstitutional population 18 years and over by 
veteran status, period of service, and sex, 2011-2012 annual 
averages, available online at http://www.bls.gov/news.release/vet.nr0.htm.
---------------------------------------------------------------------------

    OFCCP found that process and institutional barriers, and data 
collection issues are factors contributing to veterans being 
underutilized in the Federal contractor workforce. We learned much from 
conducting multiple town hall meetings, webinars, and listening 
sessions with representatives of the contractor community, state 
employment services, veterans' organizations and other interested 
parties to understand those features of the current VEVRAA regulations 
that work well, those that can be improved, and whether there was a 
need for new requirements to help effectuate the regulations' goal of 
increasing

[[Page 58645]]

employment opportunities for qualified protected veterans with Federal 
contractors. We received information indicating that improvements to 
the regulations were needed to assist protected veterans in gaining and 
keeping employment. For instance, OFCCP learned that there were 
significant problems with contractors submitting their job listings to 
state agencies in usable formats--a requirement in the VEVRAA statute--
which would impede the veteran's ability to learn about job openings 
with Federal contractors and receive priority referral to contractors 
with available positions. In addition, the lack of veteran applicant 
data hindered contractors' ability to assess the success of their 
outreach and recruitment efforts, and whether alternative outreach 
methods might attract greater numbers of protected veteran into their 
applicant pools.
    Efforts to address veterans' unemployment must be sustained, multi-
faceted, and coordinated; these regulations create an enforcement 
structure that supports long-term monitoring, self-assessment, data 
collection and accountability by employers doing business with the 
Federal government. The benchmark created by the regulations provides 
contractors with an aspirational hiring target against which they can 
measure the success of their efforts, and identify any impediments to 
hiring veterans. The regulations also provide more notice or knowledge 
to subcontractors by requiring prime contractors to include specific, 
mandated language in their subcontracts alerting subcontractors to 
their responsibilities as Federal contractors. This supports voluntary 
compliance by subcontractors and should increase job opportunities for 
veterans.
    The regulations address concerns surrounding process and 
institutional challenges related to identifying available veteran job 
applicants. The regulations clarify the contractor's mandatory job 
listing requirements and the relationship between the contractor, its 
agents, and the state employment services that provide priority 
referral of protected veterans; and create flexibility for contractors 
when they are establishing formal relationships with organizations that 
provide recruiting or training services to veterans. The relationships 
or ``linkage agreements'' can be established to meet the contractors' 
specific needs, while assuring outreach to veterans seeking employment.
C. Discussion of Impacts
    In this section, we present a summary of the costs associated with 
the revisions to part 60-300. The estimated cost to contractors is 
based on Bureau of Labor Statistics data in the publication ``Employer 
Costs for Employee Compensation'' (September 2011), which lists total 
compensation for management, professional, and related occupations as 
$50.11 per hour and administrative support as $23.72 per hour. OFCCP 
estimates that 52 percent of the burden hours will be management, 
professional, and related occupations and 48 percent will be 
administrative support.

      Table 1--Contractor New Requirements--171,275 Establishments
------------------------------------------------------------------------
            Provision                  Low cost            High cost
------------------------------------------------------------------------
EO Clause, Parag 12.............         $240,495.10         $240,495.10
EO Clause, Parag 10.............          534,418.00          534,418.00
300.42..........................        2,101,102.72        2,583,328.54
300.45..........................        2,404,913.60        2,404,913.60
                                 ---------------------------------------
    Total.......................        5,280,929.38        5,763,155.20
------------------------------------------------------------------------
EO Clause, Parag 4..............        1,736,859.16        1,736,859.16
300.44(f)(1)....................        4,328,771.47        4,809,761.68
300.44(f)(3)....................        3,174,438.00        3,174,438.00
300.44(f)(4)....................        1,603,263.25        1,603,263.25
300.44(h).......................        1,068,842.17        1,068,842.17
300.44(k).......................        3,740,925.75        6,840,549.94
                                 ---------------------------------------
    Total.......................       17,256,363.05       20,836,977.45
------------------------------------------------------------------------
Reasonable Accommodation........       19,010,209.00       19,010,209.00
Capital and Start-up............       31,457,911.40       43,429,423.20
Rule Familiarization............        8,582,590.25       34,330,361.00
Operations and Maintenance......          616,590.00        1,356,498.00
Costs to Companies..............       80,601,329.83      123,123,360.60
------------------------------------------------------------------------


      Table 2--Contractor New Requirements--251,300 Establishments
------------------------------------------------------------------------
            Provision                  Low cost            High cost
------------------------------------------------------------------------
EO Clause, Parag 12.............         $352,851.59         $352,851.59
EO Clause, Parag 10.............          784,114.64          784,114.64
300.42..........................        3,102,510.41        3,814,616.30
300.45..........................        3,528,515.87        3,528,515.87
                                 ---------------------------------------
    Total.......................        7,767,992.51        8,480,098.40
------------------------------------------------------------------------
EO Clause, Parag 4..............        2,548,372.57        2,548,372.57
300.44(f)(1)....................        6,351,328.56        7,057,031.73
300.44(f)(3)....................        4,657.640.94        4,657,640.94
300.44(f)(4)....................        2,352,343.91        2,352,343.91
300.44(h).......................        1,568,229.27        1,568,229.27

[[Page 58646]]

 
300.44(k).......................        5,488,802.46       10,036,667.35
                                 ---------------------------------------
    Total.......................       23,013,764.59       28,267,332.65
------------------------------------------------------------------------
Reasonable Accommodation........       19,010,209.00       19,010,209.00
Capital and Start-up............       46,172,324.20       64,129,119.80
Rule Familiarization............       12,592,643.00       50,370,572.00
Operations and Maintenance......          904,680.00        1,990,296.00
Costs to Companies..............      108,650,099.89      171,436,114.44
------------------------------------------------------------------------


                                Table 3--Completing Pre-offer Self-Identification
----------------------------------------------------------------------------------------------------------------
                                       171,275 Establishments                    251,300 Establishments
          Provision          -----------------------------------------------------------------------------------
                                    Low cost            High cost             Low cost            High cost
----------------------------------------------------------------------------------------------------------------
300.42(a)...................      $96,695,442.00      $212,729,213.00      $141,874,556.25      $312,124,023.75
----------------------------------------------------------------------------------------------------------------

1. Section 60-300.5 Equal Opportunity Clause
    The Equal Opportunity Clause (EO Clause) in the current rule, as 
well as the VEVRAA statute itself, requires Federal contractors to list 
their job openings with the state or local employment service delivery 
system (employment service). See 38 U.S.C. 4212(a)(2)(a); 41 CFR 60-
300.5(a)(2). Paragraph 2 of the EO Clause in the current regulations 
does not expressly address the manner in which contractors provide job 
openings to the employment delivery service system. The NPRM proposed 
requiring contractors to provide information to the employment service 
in the manner and format that the employment delivery service system 
requires. The NPRM estimated that collecting, informing the employment 
service delivery system and recordkeeping would take 15 minutes per job 
listing for an average of two listings per year. Some commenters 
asserted that OFCCP significantly underestimated the number of annual 
listings or the time required to post a listing, or both.
    The final rule clarifies the intent of the provision by stating 
that contractors need only provide job openings in a format that the 
employment service delivery system will accept. The clarification in 
the final rule does not create a new requirement; rather it explains 
OFCCP's longstanding position regarding the statutory requirement to 
list job openings. This position is explained in publically available 
Frequently Asked Questions (FAQs), published several years ago, 
addressing the various ways contractors must list job openings, the 
documentation contractors must maintain to demonstrate compliance, what 
contractors should do if they send an email and it is returned from the 
state as undeliverable, and how to comply with the job listing 
requirement by using third parties.\30\ Therefore, the final rule does 
not assess burden for complying with existing requirements concerning 
listing job openings in a manner permitted by the employment service 
delivery system. We also do not assess burden for new language 
clarifying that contractors may utilize privately run third-party 
services or exchanges to list its jobs, in addition to listing them 
with the employment service delivery system.
---------------------------------------------------------------------------

    \30\ Office of Federal Contract Compliance Programs, Jobs for 
Veterans Act Frequently Asked Questions, Can a contractor satisfy 
the job listing requirement by sending to the appropriate employment 
delivery system a link to a specific job opening posted on the 
contractor's Web site? http:[sol][sol]www.dol.gov/ofccp/regs/
compliance/faqs/jvafaqs.htm#Q20 (last accessed April 16, 2012).
---------------------------------------------------------------------------

    Paragraph 4 of the EO Clause of the current rule requires 
contractors to provide the appropriate employment service delivery 
system with the name and location of each of the contractor's hiring 
locations. See 41 CFR 60-300.5(a)(4). The NPRM proposed requiring a 
contractor to inform the employment service delivery system that: (1) 
It is a Federal contractor; (2) it is requesting priority referrals of 
protected veterans; and (3) it is providing the contact information for 
the hiring official at each location in the state. The NPRM also 
proposed requiring contractors to provide the employment service with 
the contact information for each external job search organization used 
by the contractor. Several contractors use job search and human 
resources firms to fill job vacancies in the belief that using these 
firms saves them money, gives them greater staffing flexibility and 
increases their access to talent. These firms can search for, recruit 
and even train contractors' employees using human resource software 
solutions that work independently or that can be integrated into a 
contractor's own human resources information system. The NPRM estimated 
that 25 percent of the Federal contractors use job search or similar 
firms and that 20 minutes would be required to provide the four types 
of information proposed in the NPRM. The status of the employer as a 
Federal contractor, the need for priority referrals, the hiring 
official's contact information and the information identifying the 
contractor's external job search firm are all pieces of information 
that should be readily available to the contractor and any job search 
or human resources firm the contractor uses. Transmission of the 
information via email or facsimile is not complex or time consuming and 
can be done from a desktop computer, standalone facsimile or business 
multi-function printer. We received no comments on this burden 
estimate.
    The final rule adopts proposed paragraph 4 of the EO Clause and 
further clarifies the unchallenged burden analysis for this provision. 
OFCCP estimates a total of 15 minutes to ensure that the new 
information required by the regulation is provided to the employment 
service. Because submitting job openings is already required by 
paragraph 2 of the EO Clause, and burden was assessed for that 
provision, we are only assessing additional burden for including a few 
lines of text to identify the contractor as a ``Federal contractor, 
request priority referrals, and identify the contractor's official that 
is responsible for hiring.

[[Page 58647]]

This calculation assumes that the required information is readily 
available within the contractor's human resources department, or the 
job search or similar firm used by the contractor, or both. It is also 
assumed that the language is being incorporated into a job listing 
template and stored electronically, and that this template or similar 
form is easily accessible for use and revision, as needed. The minimum 
recurring burden estimate for this provision is 42,819 hours (171,275 
contractor establishments x 15 minutes/60 = 42,819 hours). As in the 
NPRM, OFCCP estimates that 25 percent of contractors, or 42,819, will 
use outside job search organizations and incur an additional 5 minute 
burden to simultaneously notify the employment service of the contact 
information for its outside job search organizations when submitting 
the required job posting. The burden for this provision is 3,568 hours 
(42,819 contractor establishments x 5 minutes/60 = 3,568 hours). The 
minimum cost for this provision is approximately $1,736,859.\31\
---------------------------------------------------------------------------

    \31\ All of the estimated costs to contractors is based on 
Bureau of Labor Statistics data in the publication ``Employer Costs 
for Employee Compensation'' (September 2011), which lists total 
compensation for management, professional, and related occupations 
as $50.11 per hour and administrative support as $23.72 per hour. 
OFCCP estimates that 52 percent of the burden hours will be 
management, professional, and related occupations and 48 percent 
will be administrative support.
---------------------------------------------------------------------------

    Assuming there are 251,300 establishments that are impacted by the 
final rule, the recurring burden for updating existing mandatory job 
listing templates to include the required information would be 62,825 
hours (251,300 contractor establishments x 15/60 = 62,825 hours). The 
burden for providing information regarding job search organizations 
would be 5,235 hours (251,300 contractor establishments x 25 percent x 
5 minutes/60 = 5,235 hours. The cost for this provision would be 
$2,548,372.
    Paragraph 9 of the EO Clause in the final rule clarifies that 
contractors have a duty to provide notices of employee rights and 
contractor obligations in a manner that is accessible and 
understandable to persons with disabilities. The final rule revises the 
parenthetical at the end of the sentence by replacing the outdated 
suggestion of ``hav[ing] the notice read to a visually disabled 
person'' as an accommodation with the suggestion to provide Braille, 
large print, or other versions that allow persons with disabilities to 
read the notices themselves. The NPRM estimated that contractors would 
take 10 minutes to receive this accommodation request, provide the 
document in an alternative format and maintain a record of its 
disposition of the request. Upon further consideration, OFCCP 
determines that there is no additional cost for this provision. We 
specifically note that the nondiscrimination requirements of VEVRAA 
currently require contractors to provide reasonable accommodation upon 
request. See 41 CFR 60-300.21(f). Therefore, this modification in the 
final rule simply updates the examples of possible accommodations that 
contractors may provide to a visually impaired person, and does not 
impose a new obligation on contractors.
    Paragraph 9 of the final rule also allows, but does not require, 
contractors to post notices regarding employee rights and its equal 
employment opportunity obligations electronically if the contractor 
provides computers that can access the electronic posting to employees 
working remotely or has actual knowledge the employees have access to 
the postings. This provision simply provides contractors with another, 
more expedient, way to meet their existing obligations. OFCCP estimates 
no additional burden for contractors that opt to post relevant notices 
electronically.
    Paragraph 9 of the final rule requires contractors to 
electronically post a notice of job applicants' rights if the 
contractor utilizes an electronic application. The existing regulations 
require contractors to post notices regarding employee rights and equal 
employment opportunity obligations in conspicuous places for employees 
and applicants. See 41 CFR 60-300.5(a)(9). The final rule clarifies how 
contractors can meet this existing obligation for on-line applicants. 
Therefore, there is no new burden for this provision.
    The NPRM proposed adding a new paragraph 13 to the EO Clause that 
would require contractors to add to their solicitations and 
advertisements that they are an equal opportunity employer of veterans 
covered under VEVRAA. Under existing Federal requirements, including EO 
11246, contractors are required to state in solicitations and 
advertisements that the company is an equal opportunity employer. See 
41 CFR 60-1.4(a)(2). The final rule adopts the proposed requirement, 
now paragraph 12 of the EO Clause, requiring contractors to state in 
all solicitations and advertisements that they are equal opportunity 
employers of protected veterans. The NPRM estimated that it would take 
contractors 1 minute to comply with this provision. We received one 
comment from an employer group stating that ads would cost more due to 
their increased word length. OFCCP acknowledges that some contractors 
may experience an increased cost in light of this requirement. However, 
based on the comments that OFCCP received on this issue, there is no 
indication that this would be a significant problem for a substantial 
number of contractors. In fact, the cost of some advertisements and 
solicitations are based on size (i.e., quarter-page, half-page, full-
page) or number of lines, and the type of listing. Moreover, the cost 
of an advertisement will also depend on the publication's circulation 
and location. The number of words in the text actually appears be a 
lesser factor when determining cost. After some research, OFCCP 
determined that the average cost per word nationally is between .10 and 
.20 cents for a classified advertisement. Therefore, the cost would not 
be greatly impacted by adding two words, ``protected veterans,'' to the 
advertisement.
    Information from OFCCP field staff indicates that many contractors 
already include ``veterans'' in their equal employment opportunity 
statement for solicitations, particularly universities and defense 
contractors. These entities are often seeking the particular skills and 
training that veterans receive while in the military. Therefore, based 
on field experience evaluating contractor practices, OFCCP estimates 
that approximately 55 percent of contractors, or 94,201, currently 
comply with this requirement. OFCCP estimates that the remaining 77,074 
contractors will have a one-time burden of 5 minutes for amending their 
existing standard equal employment opportunity statement to include 
``protected veterans'' or similar language. Though no commenter 
specifically objected to the 1 minute estimate of time required to 
incorporate the reference to veterans into an existing form or 
template, OFCCP determined that additional time appears justified and 
adjusted the time required from 1 minute to 5 minutes in the final rule 
to ensure that the document is revised, saved or uploaded so that it is 
readily available for use. Therefore, the total burden for this 
provision is 6,423 hours (77,074 contractor establishments x 5 minutes/
60 = 6,423 hours). The total cost of this provision is approximately 
$240,495.
    Assuming there are 251,300 establishments impacted by the final 
rule, the burden for this provision would be 9,424 hours (113,085 
contractor establishments x 5 minutes/60 = 9,424 hours). The total cost 
of the provision would be $352,852.
    Paragraph 10 of the EO Clause in the final rule, originally 
paragraph 11 in the

[[Page 58648]]

NPRM, clarifies that the existing requirement to notify labor unions 
about a contractor's affirmative action efforts also includes notifying 
them of the contractor's nondiscrimination obligations. This provision 
in the NPRM is adopted as proposed. No additional burden is created by 
this clarification of an existing requirement.
    Paragraphs 1, 3, 5-8, and 11-12 of the EO Clause in the final rule 
remain unchanged from the current rule. Consequently, no burden is 
created.
    Section 41 CFR 60-300.5(d) currently allows contractors to 
incorporate the EO Clause into contracts by reference. Further, the EO 
Clause is considered part of every covered contract and subcontract 
even if it is not physically incorporated into the contract. See 41 CFR 
60-300.5(e). The NPRM proposed requiring that the entire EO Clause be 
included verbatim in Federal contracts. The NPRM estimated that it 
would take 1 minute for contractors to copy and paste the clause into 
its contracts. We received six comments on the burden created by this 
paragraph, all opposing the requirement to include the entire EO Clause 
verbatim in contracts. The commenters stated that this requirement 
would be too burdensome, as the length of a contract, subcontract, or 
purchase order would increase greatly in size, causing contracts to be 
rewritten, and that the EO Clause could not, as we had suggested, be 
readily cut and pasted into these documents. Commenters requested 
retaining incorporation by reference, consistent with other statutory 
and equal opportunity requirements. In light of these comments, the 
final rule permits incorporation of the EO Clause, with the addition of 
some additional language that OFCCP has provided in the regulatory text 
summarizing VEVRAA's purpose. OFCCP estimates that contractors will 
spend approximately 15 minutes modifying existing contract templates to 
ensure the additional language is included. The burden for this 
provision is 14,273 hours (171,275 contractor establishments x 5 
minutes/60 = 14,273 hours). The cost for this provision is $534,418.
    Assuming there are 251,300 establishments impacted by the final 
rule, the burden for this provision would be 20,942 hours (251,300 
contractor establishments x 5 minutes/60 = 20,942 hours). The cost for 
this provision would be $784,115.
    To align with the incorporation by reference approach in 41 CFR 60-
300.5(d), the final rule section 60-300.5(e) reverts back to the 
current language in the regulations. That language considers the EO 
Clause a part of the contract whether or not it is physically 
incorporated into a written contract and whether or not there is a 
written contract. No new burden is created by reverting back to the 
existing language.
2. Section 60-300.21 Prohibitions
    The NPRM proposed clarifying that an individual who rejects a 
reasonable accommodation made by the contractor may still be considered 
a qualified disabled veteran if the individual subsequently provides or 
pays for a reasonable accommodation. See 41 CFR 300.21(f)(3). The final 
rule retains the proposals in the NPRM; however, no new burden is 
created.
3. Section 60-300.40 Applicability of the Affirmative Action Program 
Requirement
    The final rule adopts the small change to paragraph (c) of this 
section. The change specifies that the official designated by the 
contractor pursuant to Sec.  60-300.44(i) reviews and annually updates 
the contractor's affirmative action program. This change reflects the 
intent of the existing language. No burden is generated by this change.
4. Section 60-300.41 Availability of the Affirmative Action Program
    Though changes to this section were proposed in the NPRM, OFCCP is 
not incorporating those proposals into the final rule. Instead, the 
final rule retains the language in the existing Sec.  60-300.41, with a 
small adjustment to clarify that contractors do not need to include the 
data metrics required by Sec.  60-300.44(k) in their AAP, due to 
commenters' concerns about confidentiality. This small clarification 
creates no new or additional burden.
5. Section 60-300.42 Invitation to Self-Identify
    The current regulation requires the contractor to invite applicants 
who are disabled veterans, as defined in section 60-300.2, to self-
identify only after making an offer of employment, subject to two 
exceptions. See 41 CFR 60-300.42(a). For all other veterans protected 
by part 60-300, the current regulation requires the contractor to 
invite the applicant to self-identify ``before the applicant begins his 
or her employment duties.'' See 41 CFR 60-300.42(b).
    The final rule retains the mandatory pre-offer invitation to self-
identify as a ``protected veteran'' in Sec.  60-300.42(a), but 
eliminates the language proposed in paragraphs (a)(1) and (a)(2) 
describing the conditions under which pre-offer invitations of disabled 
veterans are legally allowed because contractors found this language 
confusing. The post-offer invitation to self-identify that is in the 
existing rule remains in the final rule. Finally, instead of requiring 
contractors to seek input from applicants regarding accommodation, the 
final rule suggests that they should do so. The NPRM estimated that it 
would take contractors 1 minute to copy and paste an OFCCP sample 
invitation to identify into a separate form for electronic and paper 
applications. The NPRM also estimated burdens for veterans to fill out 
the self-identification form.
    OFCCP received 11 comments opposing the proposed new pre-offer 
inquiry requirement in section 60-300.42(a). The comments generally 
stated that the estimated burden was too low because, even with the 
sample invitations OFCCP included as Appendix B to the regulation, 
contractors would still need to rewrite existing self-identification 
forms and modify or update their human resources or applicant tracking 
systems.
    Based on feedback from commenters, OFCCP modified its approach to 
this calculation. OFCCP's estimate is based on the assumption that 
modifications to a contractor's application system would be conducted 
at the parent company level.\32\ This estimate distinguishes between 
contractors with web-based or automated application systems and those 
relying on manual or paper-based systems. Larger contractors, those 
with more than 100 employees are more likely to have web-based systems. 
OFCCP estimates that 72 percent of contractors utilize web-based 
application systems.\33\ Working at the corporate level, contractors 
will take 1.5 hours to review and retrieve existing sample invitations 
to self-identify, adopt the sample ``as is'' or make revisions to their 
existing form, save the invitation to self-identify and incorporate the 
document in the contractor's application form. This burden estimate

[[Page 58649]]

should be considered in conjunction with the start-up costs associated 
with this rule. OFCCP allotted 20 hours in the VEVRAA final rule to 
modify human resources information systems or establish a process to 
comply with the rules' new data collection requirements. This is in 
addition to costs specified for incorporating the invitation to self-
identify in the application process. Taken together, contractors will 
have over 21 hours to modify their existing application process. The 
burden for these contractors would be 49,676 hours (33,117 contractor 
companies x 1.5 hours = 49,676 hours). The remaining contractors would 
simply have to incorporate the invitation to self-identify in paper 
applications. OFCCP estimates this will take approximately 30 minutes. 
The burden for these contractors would be 6,440 hours (12,879 
contractor companies x 30 minutes/60 = 6,440 hours). The minimum cost 
for this provision is approximately $2,101,103.
---------------------------------------------------------------------------

    \32\ The EEO-1 data base separately identifies contractor 
entities (companies) and the facilities that comprise them. The 
FPDS-NG data base, by contrast, identifies contractor facilities, 
but does not identify the larger entities of which they are a part. 
OFCCP utilized the ratio (approximately 3.7) of parent companies to 
number of establishments from the EEO-1 data to determine that among 
the universe of 171,275 establishments there are approximately 
45,996 Federal contractor companies.
    \33\ Based on EEO-1 data on the number of establishments 100 or 
fewer employees we determined that 28% were at this level and would 
likely have manual systems as ``smaller'' establishments. Moreover, 
we used a 100 employee threshold as a cut-off for small employers 
for application of the 7% goal at the workforce or EEO-1 job 
category level.
---------------------------------------------------------------------------

    If all contractors used a web-based application the one-time burden 
of preparing the form and making the IT changes for this provision is 
68,994 hours (45,996 contractor companies x 90 minutes/60 = 68,994 
hours). The maximum cost for this provision is $2,583,328.
    Assuming there are 251,300 establishments, or 67,919 contractor 
companies,\34\ in OFCCP's jurisdiction, contractors working at the 
corporate level will take 1.5 hours to review and retrieve existing 
sample invitations to self-identify, adopt the sample ``as is'' or make 
revisions to their existing form, save the invitation to self-identify 
and incorporate the document in the contractor's application form. The 
burden for these contractors would be 73,352 hours (48,901 contractor 
companies x 1.5 hours = 73,352 hours). The remaining contractors would 
simply have to incorporate the invitation to self-identify in paper 
applications. OFCCP estimates this will take approximately 30 minutes. 
The burden for these contractors would be 9,509 hours (19,017 
contractor companies x 30 minutes/60 = 9,509 hours). The minimum cost 
for this provision would be approximately $3,102,510.
---------------------------------------------------------------------------

    \34\ OFCCP utilized the same ratio (approximately 3.7) of parent 
companies to number of establishments from the EEO-1 data to 
determine that among the universe of 251,300 establishments there 
are approximately 67,919 Federal contractor companies
---------------------------------------------------------------------------

    If all contractors used a web-based application, the one-time 
burden of preparing the form and making the IT changes for this 
provision is 101,879 hours (67,919 contractor companies x 90 minutes/60 
= 101,879 hours). The maximum cost for this provision would be 
approximately $3,814,616.
    Applicants for available positions with covered Federal contractors 
will have a minimal burden complying with section 60-300.42(a) in the 
course of completing their application for employment with the 
contractor. Section 60-300.42(a), on pre-offer self- identification, 
requires contractors to invite all applicants to self-identify whether 
or not they are a protected veteran. OFCCP estimates that there will be 
a minimum of 15 applicants per job vacancy for on average 15 vacancies 
per year. OFCCP further estimates that it will take applicants 
approximately 5 minutes to complete the form. The burden for this 
provision is 3,211,406 hours (171,275 contractors x 15 listings x 15 
applicants x 5 minutes/60 = 3,211,406 hours). The minimum costs for 
this provision is $96,695,442. OFCCP estimates that there will be a 
maximum of approximately 33 applicants per job vacancy for on average 
15 vacancies per year per establishment. OFCCP further estimates that 
it will take applicants approximately 5 minutes to fill out the self-
identification form. The burden for this provision is 7,065,093 hours 
(171,275 contractors x 15 listings x 33 applicants x 5 minutes/60 = 
7,065,093 hours). The maximum costs for this provision would be 
$212,729,213.
    Assuming there were 251,300 establishments impacted by the final 
rule, the minimum burden for this provision would be 4,711,875 hours 
(251,300 contractors x 15 listings x 15 applicants x 5 minutes/60 = 
4,711,875 hours). The minimum costs for this provision would be 
$141,874,556. OFCCP estimates that there will be a maximum of 
approximately 33 applicants per job vacancy for on average 15 vacancies 
per year per establishment. OFCCP further estimates that it will take 
applicants approximately 5 minutes to fill out the self-identification 
form. The burden for this provision is 10,366,125 hours (251,300 
contractors x 15 listings x 15 applicants x 5 minutes/60 = 10,366,125 
hours). The maximum costs for this provision would be $312,124,024.
    Several other changes to section 60-300.42 do not create new 
burdens or costs to contractors. Section 60-300.42(b) of the final rule 
carries forward the existing requirement that contractors invite 
voluntary self-identification of all applicants post-offer. Section 60-
300.42(c) of the final rule revises paragraph (c) of this section by 
deleting the second sentence of the parenthetical at the end of the 
paragraph. Neither of these provisions includes a new substantive 
requirement.
    Section 60-300.42(d) of the final rule does not incorporate the 
proposal in the NPRM that would have required contractors to ask 
disabled veterans whether any necessary reasonable accommodation is 
needed, and if so, engage in an ``interactive process'' regarding 
reasonable accommodation. Instead, the final rule retains the language 
in the existing rules which is permissive and also eliminates the 
parenthetical text that provides an example of when a contractor could 
make an inquiry about a reasonable accommodation. The text is 
unnecessary and likely confusing. We note that several comments 
suggested that the proposed change in the NPRM does not take into 
account the administrative burden associated with ascertaining whether 
an individual is legally entitled to an accommodation and to research 
alternative sources of funding for requested accommodations when the 
accommodation is financially burdensome. We are using the existing 
regulatory language in the final rule and, therefore, are no longer 
creating a new burden.
6. Section 60.300.43 Affirmative Action Policy
    The final rule clarifies that the nondiscrimination requirements of 
VEVRAA are limited to protected veterans and that claims of reverse 
discrimination may not be brought by individuals who do not fall into 
one of the ``protected veteran'' categories. No burden is incurred by 
this clarification because the final rule merely deleted the phrase ``. 
. . because of status as a . . .''
7. Section 60-300.44 Required Contents of the Affirmative Action 
Program
Section 60-300.44(a) Policy Statement
    Section 60-300.44(a) of the final rule clarifies the contractor's 
duty to make the equal opportunity policy statement accessible to all 
employees. The final rule revises the parenthetical at the end of the 
sentence by replacing the outdated suggestion of ``hav[ing] the notice 
read to a visually disabled person'' as an accommodation with the 
suggestion to provide Braille, large print, or other versions that 
allow persons with disabilities to read the notices themselves. It also 
requires the policy statement to include the attitude of the top United 
States executive, such as the Chief Executive Officer (CEO) or the 
President of the United States Division of a foreign company, toward

[[Page 58650]]

the contractor's affirmative action program.
    The NPRM estimated that it would take contractors 10 minutes to 
receive the request, provide the document in an alternative format, and 
maintain records of compliance. OFCCP determines that there is no 
additional cost for this provision in the final rule. The 
nondiscrimination requirements of OFCCP's regulations currently require 
contractors to provide reasonable accommodation upon request. See 41 
CFR 60-300.21(f). This modification simply updates the example of a 
possible accommodation that contractors may provide to a visually 
impaired person, and does not impose a new obligation on contractors. 
Similarly, no burden is associated with requiring that the contractor 
indicate the CEO's support for the affirmative action program rather 
than his or her ``attitude on the subject matter.''
Section 60-300.44(b) Review of Personnel Processes
    Section 60-300.44(b) currently outlines the requirements for 
reviewing personnel processes to ensure that they provide for 
consideration of protected veteran applicants. The NPRM proposed 
requiring contractors to review their personnel processes on an annual 
basis to ensure that their obligations are being met, and mandated 
several steps that contractors must take as part of the review process, 
including: (1) Identifying the vacancies and training programs for 
which protected veteran applicants and employees were considered; (2) 
providing a statement of reasons explaining the circumstances for 
rejecting protected veterans for vacancies and training programs; and 
(3) describing the nature and type of accommodations for special 
disabled veterans who were selected for hire, promotion, or training 
programs. The NPRM estimated that it would take contractors 15 minutes 
per listing to identify vacancies; 15 minutes to identify training 
programs; 30 minutes to provide a statement of the reasons for 
rejecting protected veterans for vacancies and training programs; and 
30 minutes per accommodation request. Commenters stated that the burden 
for performing this review would be significantly higher than OFCCP 
estimated since contractors would have to update human resources 
information systems to track the relevant data.
    In response to the comments received, the final rule does not adopt 
the proposals in the NPRM but retains the existing language in 60-
300.42(b) and no new burden is created.
Section 60-300.44(c) Physical and Mental Qualifications
    The current rule requires contractors to ``periodically'' review 
physical and mental job qualification standards to ensure that, to the 
extent the qualification standards screen out qualified, disabled 
veterans, they are job-related for the position in question and are 
consistent with business necessity. See 41 CFR 60-300.44(c)(1). The 
NPRM proposed modifying this section to require the reviews annually 
and contractors to document the methods used to complete the review, 
the results of the review, and any actions taken in response to the 
review.
    We received several comments regarding this provision expressing 
concern that the revision would require contractors to review every job 
on an annual basis whether or not changes occurred, and that OFCCP 
underestimated the burden. In order to minimize the burden, the final 
rule retains the existing language in 41 CFR 60-300.44(c)(1). 
Therefore, there is no new burden for this provision.
    Section 60-300.44(c)(3) of the final rule requires contractors to 
document the specific reasons behind its belief that the ``direct 
threat'' defense applies and maintain this document as a confidential 
medical record. The existing regulations allow contractors to use as a 
defense to an allegation that a job qualification screened out a 
disabled veteran that the disabled veteran poses a ``direct threat'' to 
the health or safety of the individual or others in the workplace. See 
41 CFR 60-300.22. A contractor seeking to establish such a defense 
would have to document its rationale in order to do so. The final rule 
requires that the contractor create and maintain a summary of the 
statement of reasons for its direct threat finding. As contractors 
would already normally document these instances, we assess no burden 
for this provision.
Section 60-300.44(f) External Dissemination of Policy, Outreach and 
Positive Recruitment
    Section 300.44(f)(1) of the current rule suggests a number of 
outreach and recruitment activities that a contractor can undertake in 
order to increase employment opportunities for protected veterans. The 
NPRM proposed requiring contractors to enter into linkage agreements 
with three veterans' recruitment sources: (1) The Local Veterans' 
Employment Representative (LVERs) in the local employment service 
office nearest the contractor's establishment; (2) one of several other 
listed organizations and agencies; and (3) one of the veterans' service 
organizations listed in the National Resource Directory (NRD). The NPRM 
estimated that it would take an average of 1.5 hours to establish one 
new linkage agreement for contractors obtaining OFCCP Compliance 
Officer assistance. The NPRM further estimated that it would take 
contractors an average of 5.5 hours to establish a linkage agreement 
without such assistance.
    We received 12 comments regarding the potential burden of this 
requirement. Commenters asserted that this requirement was more 
burdensome than we had projected. Commenters also asserted that the 
NPRM's requirement to enter into local agreements would not be 
practical for many establishments, especially for contractors that 
recruit in multiple states or nationally, and for contractors in remote 
locations. In addition, commenters expressed concern about how the 
proposed provision would impact existing linkages with organizations 
that may not be included among OFCCP's listed resources. Others 
objected to the five (5) year recordkeeping requirements.
    In response to the comments, OFCCP revised the final rule in 
several ways. First, OFCCP eliminated the requirement to establish 
three linkage agreements. The final rule retains the existing language 
of Sec.  60-300.44(f)(1)(i) which requires that the contractor 
undertake ``appropriate outreach and positive recruitment activities,'' 
and then provides a number of suggested resources. No burden is created 
in the final rule by this provision.
    Section 60-300.44(f)(1)(ii) of the final rule requires contractors 
to send written notification of the company's affirmative action 
program policies to subcontractors, vendors, and suppliers. The NPRM 
estimated that it would take contractors 5 minutes to prepare the 
notification and provide it to its subcontractors via the Internet in a 
group email and 1 minute to add or subtract any additions or deletions 
to the email group. The final rule recalculates the estimated burden of 
this provision. The existing regulations recommend that contractors 
send written notification of the company's affirmative action policies 
to subcontractors, vendors, and suppliers. See 41 CFR 60-300.44(f)(6). 
OFCCP's consultation with field staff indicates that approximately 10 
percent of contractors, or 17,128, currently implement this 
recommendation so no additional burden is calculated for this 
population. At a minimum, OFCCP estimates that the remaining 154,147 
contractors will take 15 minutes to prepare the notification and send 
it to

[[Page 58651]]

subcontractors, vendors, and suppliers, and an additional 15 minutes to 
execute the email address changes in the company's email system. The 
recurring burden for preparing the notice is 38,537 hours (154,147 
contractor establishments x 15 minutes/60 = 38,537 hours). Likewise, 
the IT burden is estimated at 38,537 hours (154,147 contractor 
establishments x 15 minutes/60 = 38,537 hours). The minimum cost for 
this provision is $4,328,771. Assuming that all 171,275 establishments 
incurred the combined 45 minute burden, the maximum cost of this 
provision is $4,809,762.
    Assuming 251,300 establishments would be impacted by the final 
rule, OFCCP estimates that 226,170 contractors will take 45 minutes to 
prepare the notification and send it to subcontractors, vendors, and 
suppliers. The burden for this provision would be 169,628 hours 
(226,170 contractor establishments x 15 minutes/60 = 169,628 hours). 
The minimum cost for this provision would be $6,351,328. Assuming that 
all 251,300 establishments incurred the combined 45 minute burden, the 
burden would be 188,475 hours (251,300 x 45 minutes/60 = 188,475 ours). 
The maximum cost for the provision would be $7,057,032.
    Section 60-300.44(f)(2)(ii) in the final rule sets forth additional 
suggested outreach efforts that contractors could engage in to increase 
its recruitment efforts. The final rule adds an additional resource to 
paragraph (f)(2)(ii) that contractors are suggested to use, and that is 
the Veterans Job Bank. No burden is created by this change.
    Section 60-300.44(f)(2)(ii)(F) in the final rule is different than 
in the NPRM, reverting back to the language in the existing regulation. 
The NPRM stated that contractors ``must consider'' protected veteran 
applicants for jobs other than the one for which they applied. The 
final rule states that contractors ``should consider applicants . . .'' 
and the final rule amends the NPRM in that regard. No burden is created 
by this provision.
    Section 60-300.44(f)(3) of the final rule requires the contractor 
to review the effectiveness of its outreach and recruitment efforts 
annually. In response to comments that OFCCP underestimated the time 
necessary to conduct the annual review, the final rule increases the 
time to comply with this provision from 20 to 30 minutes. OFCCP expects 
that contractors will conduct this assessment in conjunction with the 
correlating assessments required under EO 11246 and section 503 of the 
Rehabilitation Act (section 503). OFCCP believes that if a contractor 
has been complying with its recruitment, outreach, data collection, and 
recordkeeping responsibilities throughout the affirmative action 
program year, as well as its general obligation under Sec.  60-
300.40(c) to review and update its affirmative action program on an 
annual basis (which includes its outreach and recruitment efforts, see 
Sec.  60-300.44(f)), it will take an average of 30 additional minutes 
for the contractor to conduct the specific effectiveness assessment of 
its outreach and recruitment efforts, which would include a simple 
comparison of the annual raw data on applicants and hires that 
contractors collect pursuant to Sec.  60-300.44(k) to previous years' 
data, as well as their hiring benchmark, and determining in light of 
these numbers and any other relevant circumstances whether adjustments 
in their outreach efforts is necessary. OFCCP estimates that 1 percent 
of contractors are first-time contractors during an abbreviated 
affirmative action program year and will be unable to complete the 
review. The recurring burden for this provision is 84,781 hours 
(169,562 contractor establishments x 30 minutes/60 = 84,781 hours). The 
estimated cost for this provision is $3,174,438.
    Assuming that 251,300 establishments would be impacted by the final 
rule, the burden for this provision would be 124,394 hours (248,787 
contractor establishments x 30 minutes/60 = 124,394 hours). The cost 
for this provision would be $4,657,641.
    Section 60-300.44(f)(4) of the final rule is a recordkeeping 
provision. In the final rule, this provision requires contractors to 
document all the outreach and recruitment activities they undertake to 
comply with the obligations of this paragraph, and retain these 
documents for a period of 3 years. Under the existing regulations, 
contractors are required to establish meaningful outreach and 
recruitment contacts. Consequently, contractors' outreach and 
recruitment should already be the subject of some documentation. This 
documentation may take several forms. It may include, for example, the 
numbers and types of outreach and recruitment events, the targeted 
groups(s) or types of participants for each event, the dates or 
timeframes, location of the events, and who conducted and participated 
in the outreach and recruitment on behalf of the contractor. OFCCP 
estimates that it will take contractors 15 minutes to maintain this 
basic outreach and recruitment documentation, much of which would 
typically be generated as a result of their obligations pursuant to 
other provisions in the regulations. This includes IT time to make the 
software configuration needed to tell the system to store the data for 
an additional year. The recurring burden for this provision is 42,819 
hours (171,275 contractor establishments x 15 minutes/60 = 42,819 
hours). The estimated cost for this provision is $1,603,263. Assuming 
there are 251,300 establishments impacted by the final rule, the burden 
for this provision would be 62,825 hours (251,300 contractor 
establishments x 15 minutes/60 = 62,825 hours). The cost for this 
provision would be $2,352,344.
Section 60-300.44(g) Internal Dissemination of Policy
    The final rule adopts the proposed language in section 60-
300.44(g)(1) without change. This section requires contractors to 
develop the internal procedures listed in paragraph (g)(2) of this 
section to communicate to employees its obligation to engage in 
affirmative action efforts to employ and advance in employment 
qualified protected veterans. No additional burden is assessed here 
because the existing regulations require the development of internal 
dissemination procedures.
    The NPRM proposed, in paragraph (g)(2), making a number of 
currently suggested actions in this section mandatory, including 
incorporating the affirmative action policy in company policy manuals, 
informing all applicants and employees of the contractor's affirmative 
action obligations, and conducting meetings with management and company 
leadership to ensure they are informed about the contractor's 
obligations. The NPRM also proposed requiring contractors to hold 
meetings with employees at least once a year to discuss the company's 
affirmative action policy. The NPRM estimated that it would take 
contractors 15 minutes to download an OFCCP training module or 10 hours 
for contractors to develop their own training that communicates the 
company's affirmative action obligations.
    We received 12 comments concerning the potential burden associated 
with this paragraph. Commenters asserted that the burden calculation 
was too low because it did not account for the cost of materials, class 
time and lost productivity. In order to decrease the cost of the 
provision, commenters suggested: (1) Allowing contractors to conduct 
the training during other existing meetings related to equal employment 
opportunity; (2) training managers only, who can then disseminate the 
information to their staff; or (3) specifically allowing

[[Page 58652]]

contractors to use Internet based training to satisfy the requirement.
    The final rule narrows the scope of the internal dissemination 
efforts that will be required of contractors from that set forth in the 
NPRM in section 60-300.44(g)(2)(i). Two of the five elements that the 
NPRM proposed to require are maintained as requirements in paragraph 
(g)(2) of the final rule. The two provisions require (1) including the 
policy in the contractor's policy manual; and (2) notifying union 
officials of the policy and requesting their cooperation, if the 
contractor is party to a collecting bargaining agreement. We assume 
that the majority of Federal contractors have employee manuals and 
other information stored and available electronically, and thus we 
believe no additional burden stems from this requirement. Further, the 
EO Clause currently requires contractors to notify unions of their 
affirmative action policy so there is no new burden associated with 
this requirement. See Sec.  60-300.5, EO Clause paragraph 10 of the 
final rule. Section 60-300.44(g)(3) of the final rule suggests, but 
does not require, the elements that were proposed as requirements in 
the NPRM. Elements that were suggested in the existing rule remain in 
paragraph (g)(3) as suggestions in the final rule, with the exception 
of the recordkeeping provision, which has been eliminated. The 
provisions in the final rule are in the existing regulation so no new 
burden is created.
Section 60-300.44(h) Audit and Reporting System
    The proposals in the NPRM for Sec.  60-300.44(h) outline the 
contractor's responsibility for designing and implementing an audit and 
reporting system for the company's AAP. The only change proposed in the 
NPRM was for the contractor to document the actions taken to comply 
with the obligations set forth in this section and to maintain these 
documents subject to the requirements of Sec.  60-300.80. This would 
allow both the contractor and OFCCP to evaluate the effectiveness of 
its audit and reporting system. The final rule adopts the proposal in 
the NPRM. Under the existing rule, most contractors should document and 
maintain their analysis of the AAPs as a normal part of their review 
and assessment process. Compliance officers report that, on request, 
they review or are provided a range of documents related to the 
analysis including, for example, reports, summaries and data. In many 
regards, this provision merely acknowledges and formalizes a current 
contractor practice. OFCCP estimates that it will take contractors 10 
minutes to document the actions taken to comply with section 60-
300.44(h) and retain those documents. The recurring burden for this 
provision is 28,546 hours (171,275 contractor establishments x 10 
minutes/60 = 28,546 hours). The estimated cost of this provision is 
$1,068,842. Assuming there are 251,300 establishments impacted by the 
final rule, the burden for this provision would be 41,833 hours 
(251,300 establishments x 10 minutes/60 = 41,833 hours). The cost for 
this provision would be $1,568,229.
    Section 60-300.44(h)(2) requires contractors to undertake action 
necessary for bringing the program into compliance. This is an existing 
provision and generates no additional burden.
Section 60-300.44(i) Responsibility for Implementation
    The final rule does not incorporate the proposal in the NPRM and 
the language in the existing regulation that contractors should, but 
are not required, to take this step is retained. Therefore, no burden 
is created.
Section 60-300.44(j) Training
    The final rule restores the existing regulatory requirements. The 
final rule does not incorporate the portion of the proposed rule 
listing specific training items that must be covered by contractors or 
the specific recordkeeping requirement. However, it does retain the 
existing rule's general requirement that ``[a]ll personnel involved in 
the recruitment, screening, selection, promotion, disciplinary, and 
related processes'' be trained to ensure that the contractor's 
affirmative action commitments are implemented. Accordingly, no new 
burden is created by this provision in the final rule.
Section 60-300.44(k) Data Collection and Analysis
    The NPRM proposed adding a new section 60-300.44(k) that would 
require contractors to maintain several quantitative measurements and 
comparisons regarding protected veterans who have been referred by 
state employment services, have applied for positions with the 
contractor, and those that were hired by the contractor. The final rule 
retains the NPRM's proposal for contractors to document and maintain 
applicant and hire data, but eliminates from the final rule the 
requirement for contractors to collect, maintain, and analyze 
information on the number of referrals and the ratio of priority 
referrals of veterans to total referrals, i.e., paragraphs (k)(1), 
(k)(2), and (k)(3) in the NPRM. The final rule also does not require 
contractors to calculate applicant, hiring, and job fill ratios in this 
provision. This eliminates many of the concerns commenters had with 
regard to this paragraph, and also serves to decrease the burden on 
contractors. The other calculations mentioned in this section are 
already required by other sections of part 60-300 or by EO 11246. In 
response to the comments, OFCCP accounts for the costs of modifying 
human resources information systems in the Initial Capital and Start-up 
Costs section, infra.
    Based on feedback received from public comments expressing concerns 
about the costs of modifying human resources information systems, OFCCP 
believes that most contractors will have the capability to conduct the 
required calculations electronically. Therefore, OFCCP estimates that 
it will, at a minimum, take contractors 25 minutes to tabulate the 
applicant data using an electronic database that is integrated with the 
contractors' human resources information database where the data is 
typically stored. In addition, we estimate that an additional 10 
minutes is required to electronically or otherwise store the records 
(e.g., the report or other written documentation generated by the 
calculations that explain the methodology, the data used, and the 
findings and conclusions; the data used to conduct the calculations for 
subsequent validation of the results; and other material used by the 
contractor for the calculations). The recurring burden for this 
provision is 99,910 hours (171,275 contractor establishments x 35 
minutes/60 = 99,910 hours). The minimum cost for this provision is 
approximately $3,740,926.
    However, some commenters noted that companies may have to calculate 
this information manually. Commenters stated that these calculations 
could take more than 6 hours. OFCCP declines to adopt the 6 hour 
estimate for manual calculations in large part because the estimate and 
the requirements of this section are significantly scaled back from the 
proposed rule, as the final rule does not require contractors to 
tabulate referral data or applicant and hiring ratios. Accordingly, 
starting with the 6 hour estimate and scaling it back given the reduced 
burden of the final rule, OFCCP estimates that establishments without 
web-based application systems would take approximately 3 hours to 
tabulate the information required by this section. The burden for these 
establishments would be 102,765 hours (34,255 contractor establishments 
x 3 hours = 102,765). The remaining establishments would incur the 35

[[Page 58653]]

minute burden, for a total of 79,928 hours (137,020 contractor 
establishments x 35 minutes/60 = 79,928 hours). The maximum cost for 
this provision would be approximately $6,840,550.
    Assuming there are 251,300 establishments impacted by the final 
rule, OFCCP estimates that it will, at a minimum, take contractors 25 
minutes to tabulate the applicant data using an electronic database and 
an additional 10 minutes to electronically or otherwise store the 
records (e.g., the report or other written documentation generated by 
the calculations that explain the methodology, the data used, and the 
findings and conclusions; the data used to conduct the calculations for 
subsequent validation of the results; and other material used by the 
contractor for the calculations). The recurring burden for this 
provision would be 146,592 hours (251,300 contractor establishments x 
35 minutes/60 = 146,592 hours). The minimum cost for this provision 
would be approximately $5,488,802.
    OFCCP estimates that establishments without web-based application 
systems would take approximately 3 hours to tabulate the information 
required by this section. The burden for these establishments would be 
150,780 hours (50,260 contractor establishments x 3 hours = 150,780 
hours). The remaining establishments would incur the 35 minute burden, 
for a total of 117,273 hours (201,040 contractor establishments x 35 
minutes/60 = 117,723 hours). The maximum cost for this provision would 
be approximately $10,036,667.
    The NPRM also proposed requiring contractors to maintain that data 
for 5 years. In response to the comments, the final rule reduces the 
record retention requirement for section 60-300.44(k) to 3 years. Since 
some of the data calculations are already required by the implementing 
regulations for EO 11246, the NPRM estimated that it would take 
contractors 6 minutes to comply with the additional requirements of 
this provision. We received nine comments concerning section 60-
300.44(k). Generally, these commenters asserted that OFCCP's burden 
estimate was too low. More specifically, some commenters asserted that 
OFCCP did not include the costs of new software to collect the data. No 
new software needs are anticipated; however, a software switch or 
configuration may be required to tell the system to retain the records 
for the additional time period. According to an IT professional, this 
is a simple configuration and should take about 15 minutes to execute. 
No new burden is added because the change required by the Sec.  60-
300.44(f)(4) recordkeeping provision would include this IT change and 
they would benefit from the economy of scale.
8. Section 60-300.45 Benchmarks for Hiring
    The NPRM proposed requiring contractors to establish annual hiring 
benchmarks, expressed as the percent of total hires who are protected 
veterans that the contractor seeks to hire in the following year. The 
NPRM proposed allowing contractors to consult a number of different 
data sources to develop benchmarks that reflect the contractor's unique 
hiring circumstances. It also required contractors to document the 
annual hiring benchmark and detail the factors they considered when 
establishing the benchmark and significance of each of the factors. The 
NPRM proposed requiring that contractors retain these records for five 
years.
    The NPRM estimated a total of 1 hour per contractor establishment 
for compliance with this requirement. The NPRM further estimated that 
it would take contractors 30 minutes to maintain records of the 
benchmark calculation. We received 10 comments on the proposed 
requirement. Some commenters asserted that OFCCP significantly 
underestimated the burden hours and dollar costs of this provision. 
Commenters stated that OFCCP did not account for the number of openings 
per contractor per year, costs for software, and data storage. One 
commenter stated that the burden would be lower than for EO 11246 
because OFCCP did not propose to require availability or utilization 
analysis.
    The final rule, in consideration of the comments received, requires 
the contractor to establish benchmarks in one of two ways. A contractor 
may use the national percentage of veterans in the civilian labor force 
as the benchmark, or, the contractor may establish its own benchmark 
using the method proposed in the NPRM that fits the company's specific 
needs. OFCCP will provide, and periodically update on its public Web 
site, the national percentage of veterans in the civilian labor force.
    In light of the significant revisions to this section in the final 
rule, we revised the burden estimate. OFCCP estimates that 90 percent 
of contractors, or 154,147, will use the national benchmark provided on 
the OFCCP Web site because it is the easiest approach. The remaining 10 
percent of contractors, or 17,128, will likely opt to develop their own 
benchmarks using the various data sources described in the final rule. 
We estimate that it will take 5 minutes to access, view and print the 
national benchmark we will make available on the OFCCP Web site, and 
another 5 minutes to maintain the relevant documentation for the 90 
percent of contractors that use the national average provided by OFCCP. 
The relevant documentation could, for example, include but is not 
limited to any information showing the official adoption of the 
national benchmark by the appropriate officials and how that was 
communicated to the appropriate staff. We propose creating a specific 
Web page to make locating the information easy for contractors; 
moreover, updating the information is the responsibility of OFCCP and 
not the contractors.
    The one-time burden for using the national benchmark is 12,846 
hours (154,147 contractor establishments x 5 minutes/60 = 12,846 
hours). The burden for maintaining the relevant documentation is 12,846 
hours (154,147 contractor establishments x 5 minutes/60 = 12,846 
hours).
    OFCCP further estimates that it will take the remaining 10 percent 
of contractors 2 hours to establish their own benchmark and 15 minutes 
to maintain documentation demonstrating how the benchmark was 
determined. We expect that this type of documentation would ordinarily 
be generated during the process of establishing the contractor's 
benchmark and obtaining its approval by the appropriate internal 
officials. The amount of detail included in this documentation remains 
in the discretion of the contractors, but OFCCP suggests that the 
documentation provide adequate information as to how the benchmark was 
developed, approved and communicated to the appropriate officials and 
staff. The one-time burden for these contractors is 34,256 hours 
(17,128 contractor establishments x 2 hours = 34,256 hours). The burden 
for maintaining the associated documentation is 4,282 hours (17,128 
contractor establishments x 15 minutes/60 = 4,282 hours). The total 
cost for this provision is approximately $2,404,914.
    Assuming that 251,300 establishments would be impacted by the final 
rule, one-time burden for using the national benchmark would be 37,695 
hours (226,170 contractor establishments x 10 minutes/60 = 37,695 
hours). The burden for contractors that choose to establish their own 
benchmarks would be 56,543 hours (25,130 contractor establishments x 
2.25 hours = 34,256 hours). The total cost for this provision would be 
$3,528,516.

[[Page 58654]]

    Veterans make up 7.25 percent of the employed population.\35\ Under 
the rule, contractors have the option of establishing their own 
benchmark for employing protected veterans or meeting a benchmark set 
by OFCCP, currently 8 percent. Assuming all contractors will choose to 
meet the OFCCP benchmark, OFCCP estimates that Federal contractors 
would need to hire an additional 205,500 protected veterans.\36\ This 
amounts to approximately one veteran per establishment or three 
veterans per company. According to research conducted by the Job 
Accommodation Network (JAN), employers in the study reported that a 
high percentage (57 percent) of accommodations cost absolutely nothing. 
For the remaining 43 percent, the typical cost of providing a 
reasonable accommodation was approximately $500.\37\ Assuming that 
disabled veteran hiring will be consistent with their share of the 
disabled labor force that consists of individuals with disabilities, 
then we estimate that 36,330 veterans with disabilities may need 
accommodations with a total cost of $19,010,209 in the year the target 
is met and $8,037,516 in recurring costs. The cost of providing these 
reasonable accommodations is included in the cost of this rule.
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    \35\ Calculation based on unpublished table, Employment status 
of persons 18 years and over by veteran status, period of service, 
sex, race, Hispanic or Latino ethnicity, and disability status, 
Annual Average 2012 (Source: Current Population Survey). (10,233/
141,050)*100=7.25%. The table is available on request from the 
Bureau of Labor Statistics at the Department of Labor. BLS does not 
release some tables for a variety of reasons, such as sample size or 
possibility of confusion. Finally, this estimate includes all 
veterans, not only the protected veterans.
    \36\ Based on data from the Bureau of Labor Statistics Quarterly 
Census of Employment and Wages, OFFCP estimates that approximately 
27.4 million employees could be affected.
    \37\ Job Accommodation Network, ``Workplace Accommodations: Low 
Cost, High Impact,'' Sept. 1, 2012. Accommodation and Compliance 
Series, http://askjan.org/media/lowcosthighimpact.html (last 
accessed Aug. 9, 2013).
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9. Section 60-300.60 Compliance Evaluations
    The proposed rule set forth several changes to the process the 
contractor and OFCCP will follow in conducting compliance evaluations. 
The NPRM added a sentence to paragraph 60-300.60 (a)(1)(i) regarding 
the temporal scope of desk audits performed by OFCCP, stating that 
OFCCP ``may extend the temporal scope of the desk audit beyond that set 
forth in the scheduling letter if OFCCP deems it necessary to carry out 
its investigation of potential violations of this part.'' The final 
rule adopts this proposal. No burden is created by this provision, as 
it merely clarifies existing agency policy to ensure that it is 
understood and interpreted correctly.
    The NPRM, in Sec.  60-300.60(a)(2), proposed correcting an error in 
the existing regulations in this paragraph, changing the reference from 
the ``requirements of the Executive Order'' to the ``requirements of 
Section 4212.'' The final rule adopts this proposal and replaces the 
reference to ``Section 4212'' with ``VEVRAA.'' No burden is created by 
this change.
    Sections 60-300.60(a)(3) and (a)(4) in the NPRM revised these two 
paragraphs to allow OFCCP to review documents pursuant to a compliance 
check and conduct focused reviews either on-site or off-site, at 
OFCCP's option. The proposals are adopted in the final rule but no 
burden is created.
    The NPRM proposed adding a new paragraph (d) to Sec.  60-300.60 
detailing a new procedure for pre-award compliance evaluations under 
VEVRAA, much like the procedure that currently exists in the Executive 
Order regulations (see 41 CFR 60-1.20(d)). This proposal is adopted in 
the final rule without creation of additional burden.
10. Section 60-300.80 Recordkeeping
    Section 60-300.80 describes the recordkeeping requirements that 
apply to contractors under VEVRAA. The final rule also eliminates the 
recordkeeping requirements for referral data under the proposed 
paragraph 5 of the EO Clause and Sec.  60-300.44(k). Consequently, we 
assess no burden for these provisions.
    The final rule includes a three-year recordkeeping requirement, 
rather than the proposed five-year requirement, for Sec. Sec.  60-
300.44(f)(4), 60-300.44(k), and 60-300.45(c). No new burden is assessed 
under this section because it is carried under the burden assessed for 
Sec. Sec.  60-300.44(f)(4) and 60-300.44(k) and the contractors benefit 
from the economy of scale. In that section, we determined that no new 
software needs are anticipated; however, a software switch or 
configuration may be required to tell the system to retain the records 
for the additional time period.
11. Section 60-300.81 Access to Records
    Section 60-300.81 of the final rule requires contractors to specify 
all available records formats and allow OFCCP to select preferred 
record formats from those identified by the contractor during a 
compliance evaluation. OFCCP completed 4,014 compliance evaluations in 
Fiscal Year 2011. We estimate fewer evaluations for Fiscal Year 2012. 
Upon request, the contractor must provide OFCCP information about all 
format(s), including specific electronic formats, in which the 
contractor maintains its records and other information. No burden is 
assessed as there are no recordkeeping or document production 
requirements.
    Commenters criticized the proposal to allow OFCCP access to records 
off-site, particularly as it relates to the security of confidential 
records. The final rule retains the proposed requirement to provide 
OFCCP off-site access to materials by request. However, OFCCP modified 
Sec.  60-300.81 of the final rule in response to comments regarding 
record confidentiality.
12. Appendix A, Guidelines on Reasonable Accommodation
    We received one comment from an employer association that asserted 
contractors would have a burden if they were to be assessed liability 
and costs associated with accommodations to be determined by employees.
    Although an individual's preference for a particular reasonable 
accommodation should be given primary consideration, a contractor is 
not obligated to provide an employee with the accommodation of his or 
her choice, as long as the accommodation the contractor provides is 
effective. Nor does a contractor have to provide an employee with an 
accommodation that would impose an undue hardship on its operations, 
create a ``direct threat'' for the employee or others, or result in a 
violation of another Federal law. Accordingly, no additional burden is 
created as asserted by the commenter.
    Appendix A is incorporated into the final rule as proposed, with 
small changes to update the references to specific accommodations to 
reflect current technology and terminology (such as replacing the 
reference to ``telecommunication devices for the deaf (TDD)'' with the 
more current ``text telephones (TTYs),'' and including modern 
technology such as speech activated software, and as set forth in the 
discussion of paragraph 9 of the EO Clause in Sec.  60-300.5). 
Consistent with the change to Sec.  60-300.42(c), we also deleted the 
words ``and wish to benefit under the contractor's affirmative action 
program'' from paragraph 1. Because it does not contain new 
requirements there is no burden associated with Appendix A.
13. Initial Capital or Start-up Costs
Human Resource Information Systems
    Several commenters noted that the new data collection requirements 
in the

[[Page 58655]]

proposed rule would require modifications to existing human resources 
information systems (HRIS). In order to estimate the start-up costs for 
the final rule, OFCCP considered what would be required to modify 
existing HRIS to track the number of protected veteran applicants and 
hires. Because contractors must already maintain information on their 
employees by race/ethnicity and sex, contractors should have some 
mechanism in place to track the newly required information.
    OFCCP assumes that modifications to contractor HRIS will be done at 
the parent company level. The minimum cost for modifying HRIS is based 
on the estimate that 72 percent of contractors utilize this kind of 
electronic system.\38\ Based on information from IT professionals, 
OFCCP estimates it would take each contractor company on average 20 
hours to make the needed systems modifications to track applicant and 
hiring information for protected veterans. This includes IT and 
administrative professionals to make the changes. The estimated costs 
for these modifications are based on data from the Bureau of Labor 
Statistics in the publication ``Employer Costs for Employee 
Compensation'' (September 2011), which lists total compensation for a 
professional of $47.21 per hour. Therefore, the minimum estimated 
burden for the capital and start-up costs is 666,340 hours (33,317 
contractor companies x 20 hours = 666,340 hours). We calculate the 
total minimum estimated start-up costs as $31,457,911.40 (666,340 hours 
x $47.21/hour = $31,457,911.40) or $944 per parent company. Assuming 
all contractor companies utilize HRIS, the maximum burden would be 
919,920 hours (45,996 contractor companies x 20 hours = 919,920 hours). 
We calculate the total maximum estimated start-up costs as $43,429,423 
(919,920 hours x $47.21/hour = $43,429,423) or $944 per parent company.
---------------------------------------------------------------------------

    \38\ Utilizing EEO-1 data, OFCCP estimates that 72 percent of 
regulated contractor companies have greater than 100 employees and 
will likely use an electronic human resources system.
---------------------------------------------------------------------------

    Assuming there are 251,300 establishments in OFCCP's jurisdiction, 
or 67,919 companies, the minimum estimated burden for the capital and 
start-up costs would be 978,020 hours (48,901 contractor companies x 20 
hours = 978,020 hours). The total minimum estimated start-up costs 
would be $46,172,324 (978,020 hours x $47.21/hour = $46,172,324) or 
$944 per parent company. Assuming all contractor companies utilize 
HRIS, the maximum burden would be 1,358,380 hours (67,919 contractor 
companies x 20 hours = 1,358,380 hours). We calculate the total maximum 
estimated start-up costs as $64,129,120 (1,358,380 hours x $47.21/hour 
= $64,129,120) or $944 per parent company.
5 CFR 1320.3(b)(1)(i)--Reviewing Instructions
    Several commenters noted that the proposed rule did not quantify 
the burden of reading and understanding the VEVRAA revisions on 
contractors. OFCCP acknowledges that 5 CFR 1320.3(b)(1)(i) requires 
agencies to include in the burden analysis for new information 
collection requirements the estimated time it takes for contractors to 
review and understand the instructions for compliance. In order to 
minimize the burden, OFCCP will publish several compliance assistance 
materials including factsheets and ``Frequently Asked Questions.'' 
OFCCP will also host webinars for the contractor community that will 
describe the key provisions in the final rule.
    OFCCP estimates it will take, at a minimum, 1 hour to have a 
management professional at each establishment either read compliance 
assistance materials provided by OFCCP or participate in an OFCCP 
webinar to learn about the new requirements of the final rule. OFCCP 
believes that this is a reasonable estimate since there are 
substantially fewer new requirements in the final rule than proposed in 
the NPRM. The estimated cost of this burden is based on data from the 
Bureau of Labor Statistics in the publication ``Employer Costs for 
Employee Compensation'' (September 2011), which lists total 
compensation for a management professional at $50.11. Therefore, the 
estimated burden for rule familiarization is 171,275 hours (171,275 
contractor establishments x 1 hour = 171,275 hours). We calculate the 
total estimated minimum start-up costs as $8,582,590 (171,275 hours x 
$50.11/hour = $8,582,590) or $50 per establishment.
    Commenters suggested that reviewing the requirements of the final 
rule would take up to 6 hours. OFCCP declines to adopt this calculation 
since it is based reviewing the proposed rule which included a 
significant number of additional requirements that are not in the final 
rule. Therefore, OFCCP estimates the maximum for reviewing the rule 
would be 4 hours for a total of 685,100 (171,275 contractor 
establishments x 4 hour = 685,100 hours). We calculate the total 
maximum estimated start-up costs as $34,330,361 (685,100 x $50.11/hour 
= $34,330,361) or $200 per establishment.
    Assuming there are 251,300 establishments impacted by the final 
rule, the estimated minimum burden for the capital and start-up costs 
would be 251,300 hours (251,300 contractor establishments x 1 hour = 
251,300 hours). The total estimated minimum costs would be $12,592,643 
(251,300 hours x $50.11/hour = $12,592,643) or $50 per establishment. 
OFCCP estimates the maximum for reviewing the rule would be 4 hours for 
a total of 1,005,200 hours (251,300 contractor establishments x 4 hour 
= 1,005,200 hours). The total maximum estimated maximum costs would be 
$50,370,572 (1,005,200 hours x $50.11/hour = $50,370,572) or $200 per 
establishment.
Operations and Maintenance Costs
    OFCCP estimates that the contractor will have some operations and 
maintenance costs in addition to the burden calculated above.
60-300.42 Invitation to Self Identify
    OFCCP estimates that the contractor will have some operations and 
maintenance costs associated with the invitations to self-identify. The 
contractor must invite all applicants to self-identify at both the pre-
offer and post-offer stage of the employment process. Given the 
increasingly widespread use of electronic applications, any contractor 
that uses such applications to invite self-identification would not 
incur copy costs. However, to account for contractors who may still 
choose to use paper applications, we are including printing and/or 
copying costs. Therefore, we estimate a single one page form for both 
the pre- and post-offer invitation. The final rule reduced the number 
of forms to one instead of two to make the self-identification process 
less paperwork intensive and to reduce costs. We also estimate an 
average copying cost of $.08 per page. Assuming contractors using a 
paper-based application system, used 15 applications for an average of 
15 listings per establishment, the minimum estimated total cost to 
contractors will be $616,590 (34,255 establishments x 225 copies x $.08 
= $616,590). Assuming contractors using a paper-based application 
system, used 33 applications for an average of 15 listings per 
establishment, the maximum estimated cost to contractors will be 
$1,356,498 (34,255 establishments x 495 copies x $.08 = $1,356,498).
    Assuming that 50,260 of 251,300 establishments with a paper-based 
application system, used 15 applications for an average of 15 listings 
per establishment, the minimum

[[Page 58656]]

estimated total cost to contractors will be $904,680 (50,260 contractor 
establishments x 225 copies x $.08 = $904,680). Assuming contractors 
using a paper-based application system, used 33 applications for an 
average of 15 listings per establishment, the maximum estimated cost to 
contractors will be $1,990,296 (50,260 contractor establishments x 495 
copies x $.08 = $1,990,296).
D. Summary of Benefits
    OFCCP's analysis of the benefits of this proposal emphasizes the 
non-monetary benefits. Pursuant to Executive Order 13563, agencies 
``may consider (and discuss qualitatively) values that are difficult or 
impossible to quantify, including equity* * *'' in their analysis of 
the costs and benefits of a proposed regulation. E.O. 13563 Sec.  1(c).
    As revised, the final rule creates a number of benefits that will 
further the equal employment opportunity and affirmative action 
objectives of VEVRAA. First, the final rule will facilitate the 
connection of job-seeking veterans with contractors looking to hire. 
The final rule clarifies the mandatory job listing requirements and 
requires the contractor to provide additional, regularly updated 
information to employment service delivery systems to ensure its job 
openings are listed accurately. This clarification will help to ensure 
that veterans can easily learn about all available jobs with Federal 
contractors in their state.
    Second, the final rule will ensure that the contractor understands 
and effectively communicates its affirmative action obligations to its 
workforce and the other entities with which it does business. This, in 
turn, will facilitate a greater understanding of the purpose of the 
affirmative action policies among the contractor's employees and 
business associates and promote their active support for the 
contractor's affirmative action efforts.
    The final rule also provides increased tools with which the 
contractor can assess its affirmative action efforts. Until now, the 
contractor had few objective criteria by which it could measure the 
effectiveness of its affirmative action efforts. To that end, the final 
rule requires the contractor to collect data that will enable the 
contractor and OFCCP to more accurately assess the contractor's 
efforts. This includes collecting data about applicants so the 
contractor knows how many protected veterans it is reaching. The final 
rule also calls for the establishment of a benchmark that can serve as 
a tool to help the contractor objectively evaluate its recruitment 
efforts and determine which ones are fruitful in attracting qualified 
protected veteran candidates, and which ones need to be changed.
    Finally, the final rule modifies requirements regarding the manner 
in which OFCCP conducts its compliance reviews of contractor 
establishments. These changes include a greater emphasis on OFCCP 
review of available electronic data, greater flexibility in where 
reviews take place, and a new procedure for a pre-award compliance 
review like that currently contained in the EO 11246 regulations. These 
revisions will allow OFCCP to conduct contractor compliance reviews far 
more efficiently.
E. Conclusion
    OFCCP concludes in the final regulatory impact analysis that the 
costs of the final rule will range and likely exceed $100 million 
annually. The variations in costs depend on the number of 
establishments impacted by the final rule and applicants who respond to 
the pre-offer invitation to self-identify. Costs will also vary by 
company depending on their existing infrastructure. We estimate that 
the lower end costs would be $177,296,772 assuming that there are 
approximately 171,275 establishments impacted by the final rule. The 
lower end estimate also relies on the assumption that many of these 
establishments have some form of electronic application and human 
resources information systems that would make complying with the rules 
requirements more efficient. The higher end estimate of $483,560,138 
assumes that there are 251,300 establishments impacted by the final 
rule. The higher end further assumes that a portion of those 
contractors, primarily smaller ones with fewer employees, would have to 
expend more personnel time complying with the rules requirements. 
Therefore, the rule will have a significant economic impact. However, 
OFCCP believes that the final rule will have extensive benefits for 
veterans who are prospective and current employees of Federal 
contractors and Federal contractors. As such, OFCCP concludes that the 
benefits of the rule justify the costs.

Regulatory Flexibility Act and Executive Order 13272 (Consideration of 
Small Entities)

    The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601 et seq., 
requires agencies promulgating rules to consider the impact they are 
likely to have on small entities. More specifically, the RFA requires 
agencies to ``review rules to assess and take appropriate account of 
the potential impact on small businesses, small governmental 
jurisdictions, and small organizations.'' If a rule is expected to have 
a ``significant economic impact on a substantial number of small 
entities,'' the agency must prepare an initial regulatory flexibility 
analysis (IRFA). If, however, a rule is not expected to have a 
significant economic impact on a substantial number of small entities, 
the agency may so certify, and need not perform an IRFA.
    Based on the analysis below, in which OFCCP has estimated the 
impact on small entities that are covered contractors of complying with 
the requirements contained in this rule, OFCCP certifies that this rule 
will not have a significant economic impact on a substantial number of 
small entities.
    In making this certification, OFCCP first determined the 
approximate number of small regulated entities that would be subject to 
the rule. OFCCP's review of the FY 2009 EEO-1 data revealed that the 
final rule directly impacts 20,490 Federal contractors with between 50 
and 500 employees.\39\ OFCCP also analyzed the number of small entities 
impacted by the rule as compared to the agency's entire universe of 
regulated entities of approximately 45,996 Federal contractors.\40\ 
OFCCP estimates that approximately 44 percent of the total number of 
Federal contractors, or 20,490, are small entities with between 50 and 
500 employees. OFCCP further refined the analysis to compare the 
impacted small entities to just the universe of 21,541 small entities 
in OFCCP's jurisdiction. Under this scenario, approximately 95 percent 
of small entities would be impacted by the requirements of the rule. 
Utilizing these comparisons, the final rule may have an impact on a 
substantial number of small entities.
---------------------------------------------------------------------------

    \39\ The Small Business Administration (SBA) Office of Advocacy 
reports that there are 27.4 million small entities in the United 
States. Since Federal contracts are not limited to specific 
industries, OFCCP assessed the impact of this final rule on small 
entities overall. If OFCCP used this approach, the final rule will 
impact less than .07% of non-employer firms and .34% of employer 
firms nationwide.
    \40\ The EEO-1 data base separately identifies contractor 
entities (companies) and the facilities that comprise them. The 
FPDS-NG data base, by contrast, identifies contractor facilities, 
but does not identify the larger entities of which they are a part. 
OFCCP utilized the ratio (approximately 3.7) of parent companies to 
number of establishments from the EEO-1 data to determine that among 
the universe of 171,275 establishments there are approximately 
45,996 Federal contractor companies.
---------------------------------------------------------------------------

    OFCCP has determined, though, that the impact on entities affected 
by the

[[Page 58657]]

final rule would not be significant. In order to further inform our 
analysis of the economic impact of this rule on small entities, we 
considered the cost impact of the rule on 2 sizes of entities. We 
estimated the compliance costs of the final rule on Federal contractors 
with 50 to 100 employees and 100 to 500 employees. Contractors with 
less than 50 employees will not be subject to the new affirmative 
action requirements in subpart C of the final rule. OFCCP's analysis of 
the impact on small entities compared the estimated cost of compliance 
with the final rule for small entities to the estimated annual receipts 
of these entities as provided by the SBA. If the estimated compliance 
costs are less than 1 percent of the estimated revenues, OFCCP 
considers it appropriate to conclude that there is no significant 
economic impact.\41\
---------------------------------------------------------------------------

    \41\ Id. at 18: ``The impact could be significant if the costs 
of compliance with the rule ``exceeds 1% of the gross revenues of 
the entities in a particular sector.''
---------------------------------------------------------------------------

Contractors with 50-100 Employees
    We estimate the first year cost of this rule to a contractor with 
50 to 100 employees to be approximately $1536. The first year cost of 
the rule is the year with the highest compliance cost as the contractor 
is incurring the start-up costs of the rule. This primarily includes 
the time contractors will expend reviewing the new requirements of the 
rule and the costs of any reasonable accommodations provided to newly 
hired disabled veterans.
    In order to estimate the cost of this rule on an entity with 50 to 
100 employees, we are applying the same type of compliance cost 
structure previously described in the above cost analysis. However, for 
this small contractor, we assume they would have a manual application 
process and not require costly human resources information systems 
changes. We further assume these contractors would expend: 3 hours 
manually conducting the data analysis required by the new 41 CFR 60-
300.44(k); 2 hours establishing their own benchmark; 4 hours having a 
manager review the new requirements of the rule; and incur 
approximately $40 in copying costs in order to print out the newly 
required pre-offer invitation to self-identify for applicants. This 
also includes a cost of approximately $1,000 for providing reasonable 
accommodation to two newly hired disabled veterans.\42\
---------------------------------------------------------------------------

    \42\ To close the current gap that exists between the target 
rate of employment as proposed in VEVRAA for veterans and the actual 
rate, firms would need to hire an additional 205,000 veterans. This 
amounts to approximately 1 veteran per establishment or 3 veterans 
per company, assuming 251,300 establishments and 67,919 companies. 
Moreover, 14.21% of disabled workers in the labor force are 
veterans. According to research conducted by the Job Accommodation 
Network (JAN), employers in the study reported that a high 
percentage (57%) of accommodations cost absolutely nothing. For the 
remaining 43%, the typical cost of providing a reasonable 
accommodation was approximately $500.
---------------------------------------------------------------------------

    Utilizing data from the SBA Office of Advocacy regarding average 
receipts for firms, OFCCP determined that entities with 50 to 100 
employees average receipts of approximately $14,079,844 per year.\43\ 
The $1,536 costs of compliance with the final rule in the first year 
would be approximately .01 percent of the average value of receipts for 
these entities. Therefore, there is not a significant economic impact 
on contractors with 50 to 100 employees.
---------------------------------------------------------------------------

    \43\ In order to calculate this figure, OFCCP averaged the total 
receipts of firms with 50 to 99 employees provided by the SBA, 
Office of Advocacy. See Firm Size Data, available at www.sba.gov/advo/research/data.html#us. Since the data was issued in 2007, OFCCP 
utilized a compound 2007-2008 Consumer Price Index inflation rate 
equaling 6.8% (1.0285 x 1.0385) to calculate the 2009 average 
receipts of $14,079,844 per year.
---------------------------------------------------------------------------

Contractors with 100-500 Employees
    We estimate the first year cost of this rule to contractors with 
100 to 500 employees to be approximately $2,518. The first year cost is 
the year with the highest compliance cost as the contractor is 
incurring the start-up costs of the rule. The start-up for contractors 
with 100 to 500 employees primarily includes modifying any existing 
web-based application and human resources information systems to 
include the pre-offer invitation to self-identify, becoming familiar 
with the new requirements of the rule, and providing reasonable 
accommodations to any newly hired disabled veterans.
    In order to estimate the cost of this rule on contractors with 100 
to 500 employees, we are applying the same type of compliance cost 
structure previously described in the above cost analysis. However, for 
this small contractor, we assume they may incur more costs analyzing 
data, establishing benchmarks, and modifying human resources 
information systems. Specifically, we assume these contractors would 
expend: 3 hours manually conducting the data analysis required by the 
new 41 CFR 60-300.44(k); 2 hours establishing their own benchmark; 4 
hours having a manager review the new requirements of the rule; and 
incur approximately $40 in copying costs in order to print out the 
newly required pre-offer invitation to self-identify for applicants. We 
further assume these contractors will spend approximately $994 
modifying their human resources information systems to accommodate the 
new pre-offer invitation to self-identify. OFCCP estimates that these 
contractors would spend approximately $1,000 providing reasonable 
accommodations to approximately two newly hired disabled veterans.
    Utilizing data from the SBA Office of Advocacy regarding average 
receipts for firms, OFCCP determined that entities with 100 to 500 
employees average receipts of approximately $43,547,170 per year.\44\ 
The $2,518 costs of compliance with the final rule in the first year 
would be approximately .005 percent of the average value of receipts 
for these entities. Therefore, there is not a significant economic 
impact on contractors with 50 to 500 employees.
---------------------------------------------------------------------------

    \44\ In order to calculate this figure, OFCCP averaged the total 
receipts of firms with 100 to 499 employees provided by the SBA, 
Office of Advocacy. See Firm Size Data, available at www.sba.gov/advo/research/data.html#us. Since the data was issued in 2007, OFCCP 
utilized a compound 2007-2008 Consumer Price Index inflation rate 
equaling 6.8% (1.0285 x 1.0385) to calculate the 2009 average 
receipts of $43,547,170 per year.
---------------------------------------------------------------------------

    Notwithstanding our determination that there is not a significant 
impact as a result of this rule, OFCCP considered and implemented a 
number of alternatives in the final rule as compared to what was 
proposed in the NPRM. As noted in the preamble, the final rule no 
longer requires linkage agreements, increased review of personnel 
processes, increased review of physical and mental job qualifications, 
and prescribed training on the nondiscrimination and affirmative action 
obligations for veterans. These changes were made in large part to 
substantially decrease the burden on small entities.
    The significant benefits to covered veterans, as well as to 
contractors, are discussed extensively in the Section-by-Section and 
Executive Order 12866 analyses of the final rule. Although the primary 
objective of the final rule is to strengthen the affirmative action 
requirements of VEVRAA to employ and advance in employment protected 
veterans, the rule will benefit both veterans and contractors. As 
modified, the final rule provides contractors mechanisms for collecting 
data on protected veteran applicants and employees and promotes 
accountability by requiring contractors to review the effectiveness of 
their affirmative action efforts. The benefits of proactive recruitment 
particularly will accrue to veterans who may face significant barriers 
in returning to civilian employment. The revisions will also

[[Page 58658]]

promote access to a well-trained, job-ready employment pool for 
contractors.

Paperwork Reduction Act

DATES: Effective Date: This final rule is effective ------.
    Compliance Dates: Affected parties do not have to comply with the 
new information collection requirements in Sec. Sec.  60-300.5(a)(4); 
60-300.42; 60-300.44(f)(4); 60-300.44(g)(3); 60-300.44(k); 60.300.45; 
and 60-300.80(a) (requirement to maintain records under sections 60-
300.44(f)(4), 60-300.44(k), and 60-300.45(c)) until the Department 
publishes a Notice in the Federal Register stating that the Office of 
Management and Budget (OMB) has approved these information collection 
requirements under the Paperwork Reduction Act of 1995 (PRA), or until 
this rule otherwise takes effect, whichever date is later.
    The Department notes that no person is required to respond to a 
collection of information request unless the collection of information 
has a valid OMB Control Number. The new collections of information 
contained in this rulemaking have been submitted for review to OMB, in 
accordance with the PRA, under Control Number 1250-0004. That review is 
ongoing; consequently, the Control Number has not been activated. OFCCP 
will publish a Notice in the Federal Register announcing the results of 
OMB's review and the date the information collection requirements will 
take effect.
    The information collection requirements in this final rule relate 
to the information required to be maintained by contractors regarding 
their nondiscrimination and affirmative action obligations concerning 
protected veterans and disclosures workers may make to their employers.
    Sections 60-300.40 through 60-300.44 contain currently approved 
collections of information. Section 60-300.40 requires contractors with 
50 or more employees (and contracts of $100,000 or more entered into or 
modified after December 1, 2003, as set forth in Sec.  60-300.1(b)) to 
develop a VEVRAA affirmative action program. An affirmative action 
program is a written program in which contractors annually outline the 
steps the contractor will take and has already taken to ensure equal 
employment opportunity for protected veterans. Section 60-300.41 
describes a contractor's responsibility to make the affirmative action 
program available to all employees. Section 60-300.42 outlines the 
contractor's responsibilities and the process through which applicants 
are invited to self-identify as a veteran protected under the part 60-
300 regulations. Section 60-300.43 describes the breadth of the 
contractor's affirmative action obligation required by VEVRAA.
    Section 60-300.44 outlines the required contents of the affirmative 
action program. Contractors must develop and include an equal 
opportunity policy statement in the program. Contractors must also 
periodically review their personnel processes to ensure that qualified, 
protected veterans are provided equal opportunity and that the 
contractor is engaged in outreach to recruitment sources. Further, 
contractors must develop procedures for disseminating the policy 
internally and externally and establish an audit and reporting system 
to measure the effectiveness of the affirmative action program.
    The currently approved collections of information for these 
sections are OMB Control Numbers 1250-0001 (construction) and 1250-0003 
(supply and service).\45\ Information collection package 1250-0001 
covers the construction aspects of OFCCP's EO 11246, VEVRAA, and 
section 503 programs. The construction information collection package 
estimates that first-time contractors will take 18 hours to develop and 
document a joint section 503/VEVRAA written affirmative action program. 
It estimates that existing contractors take 7.5 hours to document and 
maintain material evidence of annually updating the affirmative action 
program. These estimates are based on previously approved information 
collection requests that quantified the estimated time to develop and 
maintain a joint section 503/VEVRAA written affirmative action program. 
Information collection 1250-0003 covers the supply and service aspects 
of OFCCP's program. This package outlines the burden required for 
contractors to develop and maintain an affirmative action program for 
women and minorities based on the contractor's number of employees, and 
also references the current VEVRAA requirements. The burden for first-
time contractors to develop a written affirmative action program is 
between 73 and 186 hours. The burden for all other contractors to 
maintain documentation of annually updating the affirmative action 
program is between 18 and 105 hours. The VEVRAA portion of these 
information collections will be eliminated from these control numbers 
once the final rule becomes effective.
---------------------------------------------------------------------------

    \45\ OMB Control Number 1250-0001 for construction is approved 
through December 31, 2014. OMB Control Number 1250-0003 is currently 
on a month-to-month renewal and is approved through April 30, 2012.
---------------------------------------------------------------------------

Paperwork Burden Hours and Related Costs

    OFCCP's new information collection request under Control Number 
1250-0004 for VEVRAA includes the burden hours and costs for the 
existing regulations and the new information collection requirements 
outlined in the final rule. This presentation separately states 
existing requirements currently approved under other OMB Control 
Numbers that will now be included under the 1250-0004 Control Number.
A. Number of Respondents
    In light of the comments received on the VERAA NPRM regarding the 
``Federal contractor establishment universe, OFCCP reexamined the 
original number of 108,288 contractor establishments it used in the 
NPRM. For the final rule and this information collection request, we 
combined Equal Employment Data System (EEDS) data with several other 
information sources.\46\ We used FY 2009 EEDS data to determine the 
number of Federal contractor establishments with 50 or more employees; 
this resulted in a total of 87,013 Federal contractor 
establishments.\47\ An additional 10,518 establishments were identified 
through a cross-check of other contractor databases for a total of 
97,531 establishments. Covered Federal contractors must develop AAPs 
for all of their establishments, even those with fewer than 50 
employees. Therefore, OFCCP added an additional 73,744 establishments, 
using EEO-1 and FPDS data, for an adjusted total of 171,275 Federal 
contractor establishments affected by the final rule. This adjustment 
to the methodology for calculating the number of contractors and 
contractor establishments results in a 58 percent increase over the 
earlier estimate used in the NPRM.
---------------------------------------------------------------------------

    \46\ OFCCP determined that the VET-100 database is not the most 
appropriate resource for calculating the number of federal 
contractors and contractor establishments. Among the concerns 
surrounding this data source are the use of contractor established 
12-month reporting timeframes, the degree to which there is overlap 
or duplication in the VETS-100 and VETS-100A reports, and the 
absence of an employee threshold for reporting purposes.
    \47\ A single firm, business, or ``entity'' may have multiple 
establishments or facilities. Thus, the number of contractor 
establishments or facilities is significantly greater than the 
number of parent contractor firms or companies.
---------------------------------------------------------------------------

    However, OFCCP received comments on the estimated number of 
contractor establishments as well, including recommending an 
establishment count of 285,390 using the Veterans

[[Page 58659]]

Employment Training Services (VETS) annual report. While OFCCP declines 
to exclusively rely on the VETS report number, we present an estimated 
high end for the range of the cost of the rule based on a contractor 
establishment number of 251,300. This number is based on 2010 VETS data 
from their pending information collection request.\48\
---------------------------------------------------------------------------

    \48\ OMB Control Number 1293-0005, Federal Contractor Veterans' 
Employment Report, VETS-100/VETS-100A, http://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=201104-1293-003 (last accessed 
Aug. 13, 2013).
---------------------------------------------------------------------------

    For the purposes of this information collection request, OFCCP 
averaged the 171,275 and 251,300 establishment figures to come up with 
a total of 211,287 establishments that will have to respond to the 
information collection requirements. All costs and hours in the burden 
analysis of this final rule are calculated using this adjusted number 
of Federal contractor establishments. Further, the burden for several 
information collection requirements in the final rule is presented in 
ranges. These estimates are also averaged for this information 
collection request.
B. Information Collections
Section 60-300.5 Equal Opportunity Clause
    Paragraph 2 of the Equal Opportunity Clause (EO Clause) requires 
contractors to list their job openings with the state or local 
employment service delivery system (employment service). OFCCP 
estimates that gathering records and providing the job listing to the 
employment service will take 25 minutes for approximately 15 listings 
per year. The burden for this third-party disclosure is 1,320,544 hours 
(211,287 contractor establishments x 25 minutes x 15 listings/60 = 
1,320,544 hours). This is a third-party disclosure.
    Paragraph 4 of the EO Clause requires contractors to provide the 
appropriate employment service with the name and location of each of 
the contractor's hiring locations, a statement of its status as a 
Federal contractor, the contact information for the hiring official at 
each location in the state, and a request for priority referrals of 
protected veterans. Paragraph 4 also requires contractors that use job 
search organizations to provide the employment service with the contact 
information for each job search organization. OFCCP estimates a total 
of 15 minutes to ensure that the information newly required by this 
regulation is provided to the employment service. The annual burden for 
this provision is 52,822 hours (211,287 contractor establishments x 15 
minutes/60 = 52,822 hours). OFCCP further estimates that 25 percent of 
contractors, or 52,821, will use outside job search organizations and 
incur an additional 5-minute burden to notify the employment service of 
the contact information for its outside job search organizations. The 
annual burden for this provision is 4,402 hours (52,821 contractor 
establishments x 5 minutes/60 = 4,402 hours). This is a third-party 
disclosure.
Section 60-300.42 Invitation to Self-Identify
    Section 60-300.42(a) requires contractors to extend a pre-offer 
invitation to self-identify as a ``protected veteran.'' OFCCP estimates 
that contractors working at the company level will take 1.5 hours to 
review and retrieve existing sample invitations to self-identify, adopt 
the sample ``as is'' or make revisions to their existing form, save the 
invitation to self-identify and incorporate the document in the 
contractor's application form. The burden for this provision is 85,656 
hours (57,104 contractor companies x 1.5 hours = 85,656 hours).
    Applicants for available positions with covered Federal contractors 
will have a minimal burden complying with Sec.  60-300.42(a) in the 
course of completing their application for employment with the 
contractor. Section 60-300.42(a), on pre-offer self- identification, 
requires contractors to invite all applicants to self-identify whether 
or not they are a protected veteran. OFCCP estimates that there will be 
an average of 24 applicants per job vacancy for on average 15 vacancies 
per year. OFCCP further estimates that it will take applicants 
approximately 5 minutes to complete the form. The burden for this 
provision is 6,388,610 hours (211,287 contractor establishments x 15 
listings x 15 applicants x 5 minutes/60 = 6,388,610 hours). This a 
third-party disclosure.
Section 60-300.44 Required Contents of the Affirmative Action Program
    OFCCP estimates that it takes existing contractors, or 209,174, 
approximately 7.5 hours to document and maintain material evidence of 
annually updating a joint section 503 and VEVRAA affirmative action 
program. The burden for this requirement is 1,568,805 hours (209,174 
contractor establishments x 7.5 hours = 1,568,805 hours).
    OFCCP estimates that 1 percent of all contractors, or 2,112, are 
new contractors that will need to initially develop a joint section 503 
and VEVRAA affirmative action program. OFCCP estimates that it takes 
approximately 18 hours to document and maintain material evidence of 
developing the program. Therefore, the recordkeeping burden for this 
provision is 38,016 hours (2,112 contractor establishments x 18 hours = 
38,016 hours).
Section 60-300.44(f) External Dissemination of Policy, Outreach and 
Positive Recruitment
    Section 60-300.44(f)(1)(ii) of the final rule requires contractors 
to send written notification of the company's affirmative action 
program policies to subcontractors, vendors, and suppliers. The 
existing regulations recommend that contractors send written 
notification of the company's affirmative action policies to 
subcontractors, vendors, and suppliers. See 41 CFR 60-300.44(f)(6). 
OFCCP estimates that contractors will take 15 minutes to prepare the 
notification and send it to subcontractors, vendors, and suppliers, and 
an additional 15 minutes to execute the email address changes in the 
company's email system. Likewise, the burden for any information 
technology assistance needed to send the written communication is 
estimated at 15 minutes. The burden for this request is 158,465 hours 
(211,287 contractor establishments x 45 minutes/60 = 158,465 hours).
    Section 60-300.44(f)(4) of the final rule requires contractors to 
document all activities it undertakes to comply with the obligations of 
this paragraph, and retain these documents for a period of 3 years. 
OFCCP estimates that it will take contractors 15 minutes to retain the 
required documentation. Retaining these records means storing the 
records generated either electronically or in hardcopy, consistent with 
the contractor's existing business practices for how to store records. 
The annual recordkeeping burden for this provision is 52,822 hours 
(211,287 contractor establishments x 15 minutes/60 = 52,822 hour).
Section 60-300.44(h) Audit and Reporting System
    Section 60-300.44(h)(1)(vi) requires contractors to document the 
actions taken to meet the requirements of 60-300.44(h), as mandated in 
the current regulations. OFCCP estimates that it will take contractors 
10 minutes to document compliance with this existing provision to 
create an audit and reporting system. Documentation may include, as an 
example, the standard operating procedure of the system including roles 
and responsibilities, and audit and reporting timeframes and

[[Page 58660]]

lifecycles. Because contractors are currently required to have an audit 
and reporting system, it is expected that some documentation of the 
process and operation of the system audit already exists. The annual 
recordkeeping burden of this provision is 35,215 hours (211,287 
contractor establishments x 10 minutes/60 = 35,215 hours).
Section 60-300.44(k) Data Collection and Analysis
    Section 60-300(k) of the final rule requires contractors to collect 
and analyze certain categories of data.
    Based on feedback received from public comments expressing concerns 
about the costs of modifying human resources information systems, OFCCP 
believes that most contractors will have the capability to conduct the 
required calculations electronically. However, some companies may have 
to calculate this information manually. Therefore, OFCCP estimates that 
the average time to conduct the analysis and maintain the relevant 
documentation would be 1 hour 25 minutes. Relevant documentation could 
include the report or other written documentation generated by the 
calculations that explain the methodology, the data used, and the 
findings and conclusions; the data used to conduct the calculations for 
subsequent validation of the results; and other material used by the 
contractor for the calculations. The recurring burden for this 
provision is 299,233 hours (251,300 contractor establishments x 85 
minutes/60 = 299,233 hours).
    No new software needs are anticipated for compliance with section 
60-300.44(k); however, a software switch or configuration may be 
required to tell the system to retain the records for the additional 
required time period. The estimated time needed for making this switch 
is included with the burden estimate for section 60-300.44(f)(4).
Section 60-300.45 Benchmarks for Hiring
    The final rule requires the contractor to establish benchmarks in 
one of two ways. A contractor may use as its benchmark the national 
average number of veterans in the civilian labor force, which OFCCP 
will provide (and periodically update) on its public Web site. Or, 
alternatively, the contractor may establish its own individual 
benchmark using the five-factor method proposed in the NPRM (and 
retained in the final rule) to develop a benchmark that fits the 
company's specific needs. OFCCP estimates that it will take contractors 
on average 10 minutes to maintain material evidence of compliance with 
this provision. The burden of this provision would be 35,215 hours 
(211,287 establishments x 10 minutes/60 = 35,215 hours).
Section 60-300.81 Access to Records
    Section 60-300.81 of the final rule requires contractors who are 
the subject of a compliance evaluation or complaint investigation to 
specify all available record formats and allow OFCCP to select 
preferred record formats from those identified by the contractor during 
a compliance evaluation. Pursuant to 5 CFR 1320.4(a)(2), this 
information collection is excluded from the PRA requirements because it 
is related to an ``administrative action, investigation, or audit 
involving an agency against specific individuals or entities.''
C. Summary of Costs
    The estimated cost to contractors is based on Bureau of Labor 
Statistics data in the publication ``Employer Costs for Employee 
Compensation'' (September 2011), which lists total compensation for 
management, professional, and related occupations as $50.11 per hour 
and administrative support as $23.72 per hour. OFCCP estimates that 52 
percent of the burden hours will be management, professional, and 
related occupations and 48 percent will be administrative support.

 Table 1--Total Burden for Sec.  Sec.   60-300.5; 60-300.42; 60-300.44;
                              and 60-300.45
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Recordkeeping Burden Hours.................................    2,029,395
Reporting Burden Hours.....................................            0
Third Party Disclosure Burden Hours........................    7,960,499
                                                            ------------
    Total Burden Hours.....................................    9,989,894
------------------------------------------------------------------------


       Table 2--Summary of Burden Hours and Costs for Contractors
------------------------------------------------------------------------
      Existing requirements          Burden hours            Total
------------------------------------------------------------------------
EO Clause, Parag 2 (Mandatory              1,320,544      $49,444,855.52
 Job Listing)...................
Current Existing Contractors               1,568,805       58,740,451.85
 (Written Affirmative Action
 Program).......................
Current New Contractors (Written              38,016        1,423,425.48
 Affirmative Action Program)....
                                 ---------------------------------------
    Total.......................           2,927,365      109,608,732.86
------------------------------------------------------------------------
        New requirements             Burden hours        Burden costs
------------------------------------------------------------------------
EO Clause, Parag 4 (Mandatory                 52,822        1,977,794.22
 Job Listing)...................
EO Clause, Parag 4 (Mandatory                  4,402          164,813.84
 Job Listing)...................
300.42 (Invitation to Self-                   85,656        2,342,234.35
 Identify)......................
300.44(f)(1) (Notice to                      158,465        5,933,382.66
 Subcontractors, etc.)..........
300.44(f)(4) (Outreach and                    52,822        1,977,794.22
 Recruitment Recordkeeping).....
300.44(h) (Affirmative Action                 35,215        1,318,529.48
 Program Audit Recordkeeping)...
300.44(k) (Data Collection                   299,323       11,207,500.59
 Analysis)......................
300.45 (Benchmarks                            35,215        1,318,529.48
 Recordkeeping).................
                                 ---------------------------------------
    Total.......................           3,651,284      135,849,311.71
------------------------------------------------------------------------


        Table 3--Summary of Non-Contractor Burden Hours and Costs
------------------------------------------------------------------------
         Existing requirement             Burden hours     Burden costs
------------------------------------------------------------------------
Section 60-300.42 (Self-                     6,338,610     $190,855,547
 Identification)......................
------------------------------------------------------------------------


[[Page 58661]]

    The total estimated cost for applicants to fill out the self-
identification form is based on Bureau of Labor Statistics data in the 
publication ``Employer Costs for Employee Compensation'' (September 
2011), which lists an average total compensation for all civilian 
workers as $30.11.
D. Initial Capital or Start-up Costs
Human Resources Information Systems
    OFCCP estimates on average it will take each contractor, working at 
the company level, on average 20 hours to have a professional make the 
needed systems modifications to track applicant and hiring information 
for protected veterans. This includes IT and administrative 
professionals to make any necessary changes. The estimated costs for 
these modifications are based on data from the Bureau of Labor 
Statistics in the publication ``Employer Costs for Employee 
Compensation'' (September 2011), which lists total compensation for a 
professional of $47.21 per hour. The cost for these modifications is 
$53,917,597 (57,104 contractor companies x $47.21 = $53,917,597).
5 CFR 1320.3(b)(1)(i)--Reviewing Instructions
    Several commenters noted that the proposed rule did not quantify 
the burden of reading and understanding the VEVRAA revisions on 
contractors. OFCCP acknowledges that 5 CFR 1320.3(b)(1)(i) requires 
agencies to include in the burden analysis for new information 
collection requirements the estimated time it takes for contractors to 
review and understand the instructions for compliance. In order to 
minimize the burden, OFCCP will publish several compliance assistance 
materials including factsheets and ``Frequently Asked Questions.'' 
OFCCP will also host webinars for the contractor community that will 
describe the key provisions in the final rule.
    OFCCP estimates it will take, on average, 2.5 hours to have a 
management professional at each establishment either read compliance 
assistance materials provided by OFCCP or participate in an OFCCP 
webinar to learn about the new requirements of the final rule. The 
estimated cost of this burden is based on data from the Bureau of Labor 
Statistics in the publication ``Employer Costs for Employee 
Compensation'' (September 2011), which lists total compensation for a 
management professional at $50.11. Therefore, the estimated burden for 
rule familiarization is 528,217 hours (211,287 contractor 
establishments x 2.5 hours = 528,217 hours). We calculate the total 
estimated cost for rule familiarization as $26,468,979 (528,217 hours x 
$50.11/hour = $26,468,979).
Operations and Maintenance Costs
    OFCCP estimates that the contractor will have some operations and 
maintenance costs in addition to the burden calculated above.
60-300.42 Invitation to Self Identify
    OFCCP estimates that the contractor will have some operations and 
maintenance cost associated with the invitations to self-identify. The 
contractor must invite all applicants to self-identify at both the pre-
offer and post-offer stage of the employment process. Given the 
increasingly widespread use of electronic applications, any contractor 
that uses such applications would not incur copy costs. However, to 
account for contractors who may still choose to use paper applications, 
we are including printing and/or copying costs. Therefore, we estimate 
a single one page form for both the pre- and post-offer invitation. 
Assuming contractors using a paper-based application system, used 24 
applications for an average of 15 listings per establishment, the 
minimum estimated total cost to contractors will be $1,217,002 (42,257 
establishments x 360 copies x $.08 = $1,217,002).
E. Transfer of Burden From OMB Control Numbers 1250-0001 and 1250-0003 
to 1250-0004
    As a result of the final rule, the information collection 
requirements of VEVRAA will be placed under a separate information 
collection package. OMB Control Numbers 1250-0001 for the agency's 
construction enforcement program and 1250-0003 for its supply and 
service program currently include the annual burden hours and related 
costs for the time contractors take to document the contents of the 
written affirmative action program under VEVRAA. When the information 
collection requirements in this Final Rule become effective, the 
Department will submit non-substantive change requests for Control 
Numbers 1250-0001 and 1250-0003 to reflect the fact that the VEVRAA 
portions of burden hours and costs are included in this separate 
information collection package, OMB Control Number 1250-0004.
    These paperwork burden estimates are summarized as follows:
    Type of Review: New collection.
    Agency: Office of Federal Contract Compliance Programs, Department 
of Labor.
    Title: Vietnam Era Veterans' Readjustment Assistance Act of 1974, 
as amended by the Jobs for Veterans Act of 2002, 38 U.S.C. 4212 
(VEVRAA).
    OMB ICR Reference Number: 1250-0004.
    Affected Public: Business or other for-profit; individuals.
    Estimated Number of Annual Responses: xxxx.
    Frequency of Response: On occasion.
    Estimated Total Annual Burden Hours: 9,989,894.
    Estimated Total Initial and Other Costs: $408,308,436.
    The estimated $408,308,436 is the total of the PRA costs resulting 
from the existing requirements of part 60-300 and the new requirements 
of this final rule.

Small Business Regulatory Enforcement Fairness Act of 1996

    This rule is a major rule as defined by Section 804 of the Small 
Business Regulatory Enforcement Fairness Act of 1996. This rule may 
result in an annual effect on the economy of $100 million or more; a 
major increase in costs or prices; or significant adverse effects on 
competition, employment, investment, productivity, innovation, or on 
the ability of the United States-based companies to compete with 
foreign-based companies in domestic and export markets.

Unfunded Mandates Reform Act of 1995

    For purposes of the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 
1532, this final rule includes a Federal mandate that may result in 
excess of $100 million in expenditures in the private sector in any one 
year. Accordingly, in compliance with 2 U.S.C. 1532, OFCCP provides the 
following written statement. All references to other sections of this 
final rule are incorporated by reference pursuant to 2 U.S.C. 1532(c).
    (1) The final rule is authorized by the Vietnam Era Veterans' 
Readjustment Assistance Act, as amended, 38 U.S.C. 4212.
    (2) A qualitative and quantitative assessment of the anticipated 
costs and benefits of this rule, including the costs and benefits to 
the private sector, are set forth in the Regulatory Procedures section 
of the final rule (specifically the sections describing Executive 
Orders 12866 and 13563, the Regulatory Flexibility Act, and the 
Paperwork Reduction Act) and the Section-by-Section Analysis in the 
preamble to the final rule. OFCCP anticipates no effect of the final 
rule on health, safety, and the natural environment not otherwise

[[Page 58662]]

discussed in the sections set forth above.
    (3) Estimates of future compliance costs are set forth in the 
Regulatory Procedures section of the final rule (specifically the 
sections describing Executive Orders 12866 and 13563, the Regulatory 
Flexibility Act, and the Paperwork Reduction Act). OFCCP anticipates 
none of the disproportionate budgetary effects of the rule set forth in 
2 U.S.C. 1532(a)(3)(B).
    (4) To the extent feasible and relevant, OFCCP has estimated the 
effect of the rule on the national economy in the Regulatory Procedures 
section of the final rule (specifically the sections describing 
Executive Orders 12866 and 13563, the Regulatory Flexibility Act, and 
the Paperwork Reduction Act).
    (5) The provisions of 2 U.S.C. 1532(a)(5) do not apply to this 
final rule.
    Finally, OFCCP identified, considered, and implemented a reasonable 
number of regulatory alternatives that were the least burdensome 
alternative. In those cases where OFCCP did not select the least 
burdensome alternative, it has provided an explanation of the reasons 
these suggestions were not adopted in the corresponding section of the 
Section-by-Section Analysis in the preamble to the final rule and/or 
the Regulatory Procedures section of the final rule (specifically the 
sections describing Executive Orders 12866 and 13563, the Regulatory 
Flexibility Act, and the Paperwork Reduction Act).

Executive Order 13132 (Federalism)

    OFCCP has reviewed this final rule in accordance with Executive 
Order 13132 regarding federalism, and has determined that it does not 
have ``federalism implications.'' This rule will not ``have substantial 
direct effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government.''

Executive Order 13175 (Consultation and Coordination With Indian Tribal 
Governments)

    This final rule does not have tribal implications under Executive 
Order 13175 that requires a tribal summary impact statement. The final 
rule does not have substantial direct effects on one or more Indian 
tribes, on the relationship between the Federal government and Indian 
tribes or on the distribution of power and responsibilities between the 
Federal government and Indian tribes.

Effects on Families

    The undersigned hereby certifies that the final rule would not 
adversely affect the well-being of families, as discussed under section 
654 of the Treasury and General Government Appropriations Act, 1999.

Executive Order 13045 (Protection of Children)

    This final rule would have no environmental health risk or safety 
risk that may disproportionately affect children.

Environmental Impact Assessment

    A review of this final rule in accordance with the requirements of 
the National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. 4321 et 
seq.; the regulations of the Council on Environmental Quality, 40 CFR 
1500 et seq.; and DOL NEPA procedures, 29 CFR part 11, indicates the 
final rule would not have a significant impact on the quality of the 
human environment. There is, thus, no corresponding environmental 
assessment or an environmental impact statement.

Executive Order 13211 (Energy Supply)

    This final rule is not subject to Executive Order 13211. It will 
not have a significant adverse effect on the supply, distribution, or 
use of energy.

Executive Order 12630 (Constitutionally Protected Property Rights)

    This final rule is not subject to Executive Order 12630 because it 
does not involve implementation of a policy that has takings 
implications or that could impose limitations on private property use.

Executive Order 12988 (Civil Justice Reform Analysis)

    This final rule was drafted and reviewed in accordance with 
Executive Order 12988 and will not unduly burden the Federal court 
system. The final rule was: (1) Reviewed to eliminate drafting errors 
and ambiguities; (2) written to minimize litigation; and (3) written to 
provide a clear legal standard for affected conduct and to promote 
burden reduction.

List of Subjects in 41 CFR Part 60-300

    Administrative practice and procedure, Civil rights, Employment, 
Equal employment opportunity, Government contracts, Government 
procurement, Individuals with disabilities, Investigations, Reporting 
and recordkeeping requirements, and Veterans.

Patricia A. Shiu,
Director, Office of Federal Contract Compliance Programs.

    Accordingly, under authority of 38 U.S.C. 4212, Title 41 of the 
Code of Federal Regulations, Chapter 60, is amended to read as follows:

PART 60-250 [REMOVED]

0
1. Remove Part 60-250
0
2. Revise Part 60-300 to read as follows:

PART 60-300--AFFIRMATIVE ACTION AND NONDISCRIMINATION OBLIGATIONS 
OF FEDERAL CONTRACTORS AND SUBCONTRACTORS REGARDING DISABLED 
VETERANS, RECENTLY SEPARATED VETERANS, ACTIVE DUTY WARTIME OR 
CAMPAIGN BADGE VETERANS, AND ARMED FORCES SERVICE MEDAL VETERANS

Subpart A--Preliminary Matters, Equal Opportunity Clause
Sec.
60-300.1 Purpose, applicability and construction.
60-300.2 Definitions.
60-300.3 [Reserved].
60-300.4 Coverage and waivers.
60-300.5 Equal opportunity clause.
Subpart B--Discrimination Prohibited
60-300.20 Covered employment activities.
60-300.21 Prohibitions.
60-300.22 Direct threat defense.
60-300.23 Medical examinations and inquiries.
60-300.24 Drugs and alcohol.
60-300.25 Health insurance, life insurance and other benefit plans.
Subpart C--Affirmative Action Program
60-300.40 Applicability of the affirmative action program 
requirement.
60-300.41 Availability of affirmative action program.
60-300.42 Invitation to self-identify.
60-300.43 Affirmative action policy.
60-300.44 Required contents of affirmative action programs.
60-300.45 Benchmarks for hiring.
Subpart D--General Enforcement and Complaint Procedures
60-300.60 Compliance evaluations.
60-300.61 Complaint procedures.
60-300.62 Conciliation agreements.
60-300.63 Violation of conciliation agreements.
60-300.64 Show cause notices.
60-300.65 Enforcement proceedings.
60-300.66 Sanctions and penalties.
60-300.67 Notification of agencies.
60-300.68 Reinstatement of ineligible contractors.
60-300.69 Intimidation and interference.
60-300.70 Disputed matters related to compliance with the Act.

[[Page 58663]]

Subpart E--Ancillary Matters
60-300.80 Recordkeeping.
60-300.81 Access to records.
60-300.82 Labor organizations and recruiting and training agencies.
60-300.83 Rulings and interpretations.
60-300.84 Responsibilities of appropriate employment service 
delivery system.



     Appendix A to Part 60-300--Guidelines on a Contractor's Duty to 
Provide Reasonable Accommodation

Appendix B to Part 60-300--Sample Invitation to Self-Identify

Appendix C to Part 60-300--Review of Personnel Processes

    Authority: 29 U.S.C. 793; 38 U.S.C. 4211 and 4212; E.O. 11758 (3 
CFR, 1971-1975 Comp., p. 841).

Subpart A--Preliminary Matters, Equal Opportunity Clause


Sec.  60-300.1  Purpose, applicability and construction.

    (a) Purpose. The purpose of the regulations in this part is to set 
forth the standards for compliance with the Vietnam Era Veterans' 
Readjustment Assistance Act of 1974, as amended, 38 U.S.C. 4212, 
(VEVRAA), which prohibits discrimination against protected veterans and 
pre-JVA veterans as defined in this part, and requires Government 
contractors and subcontractors to take affirmative action to employ and 
advance in employment qualified protected veterans.
    Disabled veterans, recently separated veterans, active duty wartime 
or campaign badge veterans, and Armed Forces service medal veterans are 
protected veterans under VEVRAA.
    (b) Applicability. This part applies to any Government contract or 
subcontract of $100,000 or more, entered into or modified on or after 
December 1, 2003, for the purchase, sale or use of personal property or 
nonpersonal services (including construction): Provided, that subpart C 
of this part applies only as described in Sec.  60-300.40(a); and that 
the non-discrimination protections in Sec.  60-300.21 and the right to 
file complaints alleging discriminatory conduct set forth in Sec.  60-
300.61 also apply to ``pre-JVA veterans'' as defined in Sec.  60-300.2, 
who are applicants or employees of a contractor with a Government 
contract of $25,000 or more entered into prior to December 1, 2003, and 
unmodified since to a contract amount of $100,000. Compliance by the 
contractor with the provisions of this part will not necessarily 
determine its compliance with other statutes, and compliance with other 
statutes will not necessarily determine its compliance with this part.
    (c) Construction--(1) In general. The Interpretive Guidance on 
Title I of the Americans with Disabilities Act (ADA) (42 U.S.C. 12101, 
et seq.) set out as an appendix to 29 CFR part 1630 issued pursuant to 
Title I may be relied upon for guidance in interpreting the parallel 
provisions of this part.
    (2) Relationship to other laws. This part does not invalidate or 
limit the remedies, rights, and procedures under any Federal law or the 
law of any state or political subdivision that provides greater or 
equal protection for the rights of disabled veterans, recently 
separated veterans, active duty wartime or campaign badge veterans, or 
Armed Forces service medal protected veterans as compared to the 
protection afforded by this part. It may be a defense to a charge of 
violation of this part that a challenged action is required or 
necessitated by another Federal law or regulation, or that another 
Federal law or regulation prohibits an action (including the provision 
of a particular reasonable accommodation) that would otherwise be 
required by this part.
    (i) Uniformed Services Employment and Reemployment Rights Act. This 
part does not invalidate or limit the obligations, responsibilities, 
and requirements of the contractor pursuant to the Uniformed Services 
Employment and Reemployment Rights Act (USERRA) (38 U.S.C. 4301, et 
seq.). This includes the obligation under USERRA to reemploy employees 
of the contractor following qualifying service in the uniformed 
services in the position the employee would have obtained with 
reasonable certainty had the employee been continuously employed during 
the period of uniformed service. Compliance by the contractor with the 
provisions of this part will not necessarily determine its compliance 
with USERRA, and compliance with USERRA will not necessarily determine 
its compliance with this part.


Sec.  60-300.2  Definitions.

    For the purpose of this part:
    (a) Act means the Vietnam Era Veterans' Readjustment Assistance Act 
of 1974, as amended, 38 U.S.C. 4212, also referred to throughout this 
regulation as ``VEVRAA.''
    (b) Active duty wartime or campaign badge veteran means a veteran 
who served on active duty in the U.S. military, ground, naval or air 
service during a war or in a campaign or expedition for which a 
campaign badge has been authorized, under the laws administered by the 
Department of Defense.
    (c) Armed Forces service medal veteran means any veteran who, while 
serving on active duty in the U.S. military, ground, naval or air 
service, participated in a United States military operation for which 
an Armed Forces service medal was awarded pursuant to Executive Order 
12985 (61 FR 1209).
    (d) Compliance evaluation means any one or combination of actions 
OFCCP may take to examine a Federal contractor's or subcontractor's 
compliance with one or more of the requirements of the Act.
    (e) Contract means any Government contract or subcontract.
    (f) Contractor means, unless otherwise indicated, a prime 
contractor or subcontractor holding a contract of $100,000 or more.
    (g) Direct threat means a significant risk of substantial harm to 
the health or safety of the individual or others that cannot be 
eliminated or reduced by reasonable accommodation. The determination 
that an individual poses a direct threat shall be based on an 
individualized assessment of the individual's present ability to 
perform safely the essential functions of the job. This assessment 
shall be based on a reasonable medical judgment that relies on the most 
current medical knowledge and/or on the best available objective 
evidence. In determining whether an individual would pose a direct 
threat, the factors to be considered include:
    (1) The duration of the risk;
    (2) The nature and severity of the potential harm;
    (3) The likelihood that the potential harm will occur; and
    (4) The imminence of the potential harm.
    (h) Director means the Director, Office of Federal Contract 
Compliance Programs of the United States Department of Labor, or his or 
her designee.
    (i) Disabled veteran means:
    (1) A veteran of the U.S. military, ground, naval or air service 
who is entitled to compensation (or who but for the receipt of military 
retired pay would be entitled to compensation) under laws administered 
by the Secretary of Veterans Affairs, or
    (2) A person who was discharged or released from active duty 
because of a service-connected disability.
    (j) Employment service delivery system means a service delivery 
system at which or through which labor exchange services, including 
employment, training, and placement services, are offered in accordance 
with the Wagner-Peyser Act. The Wagner-Peyser Act requires that these 
services be provided as part of the One-Stop delivery system 
established by the

[[Page 58664]]

States under Section 134 of the Workforce Investment Act of 1998.
    (k) Equal opportunity clause means the contract provisions set 
forth in Sec.  60-300.5, ``Equal opportunity clause.''
    (l) Essential functions--(1) In general. The term essential 
functions means fundamental job duties of the employment position the 
disabled veteran holds or is seeking. The term essential functions does 
not include the marginal functions of the position.
    (2) A job function may be considered essential for any of several 
reasons, including, but not limited to, the following:
    (i) The function may be essential because the reason the position 
exists is to perform that function;
    (ii) The function may be essential because of the limited number of 
employees available among whom the performance of that job function can 
be distributed; and/or
    (iii) The function may be highly specialized so that the incumbent 
in the position is hired for his or her expertise or ability to perform 
the particular function.
    (3) Evidence of whether a particular function is essential 
includes, but is not limited to:
    (i) The contractor's judgment as to which functions are essential;
    (ii) Written job descriptions prepared before advertising or 
interviewing applicants for the job;
    (iii) The amount of time spent on the job performing the function;
    (iv) The consequences of not requiring the incumbent to perform the 
function;
    (v) The terms of a collective bargaining agreement;
    (vi) The work experience of past incumbents in the job; and/or
    (vii) The current work experience of incumbents in similar jobs.
    (m) Government means the Government of the United States of 
America.
    (n) Government contract means any agreement or modification thereof 
between any contracting agency and any person for the purchase, sale or 
use of personal property or nonpersonal services (including 
construction). The term Government contract does not include agreements 
in which the parties stand in the relationship of employer and 
employee, and federally assisted contracts.
    (1) Construction, as used in the definition of Government contract 
and subcontract of this section, means the construction, 
rehabilitation, alteration, conversion, extension, demolition, or 
repair of buildings, highways, or other changes or improvements to real 
property, including facilities providing utility services. The term 
also includes the supervision, inspection, and other on-site functions 
incidental to the actual construction.
    (2) Contracting agency means any department, agency, establishment 
or instrumentality of the United States, including any wholly owned 
Government corporation, which enters into contracts.
    (3) Modification means any alteration in the terms and conditions 
of a contract, including supplemental agreements, amendments and 
extensions.
    (4) Nonpersonal services, as used in the definition of Government 
contract and subcontract of this section, includes, but is not limited 
to, the following: Utility, construction, transportation, research, 
insurance, and fund depository.
    (5) Person, as used in the definition of Government contract and 
subcontract of this section, means any natural person, corporation, 
partnership or joint venture, unincorporated association, state or 
local government, and any agency, instrumentality, or subdivision of 
such a government.
    (6) Personal property, as used in the definition of Government 
contract and subcontract of this section, includes supplies and 
contracts for the use of real property (such as lease arrangements), 
unless the contract for the use of real property itself constitutes 
real property (such as easements).
    (o) Pre-JVA veteran means an individual who is an employee of or 
applicant to a contractor with a contract of $25,000 or more entered 
into prior to December 1, 2003 and unmodified since to $100,000 or 
more, and who is a special disabled veteran, veteran of the Vietnam 
era, pre-JVA recently separated veteran, or other protected veteran, as 
defined below:
    (1) Special disabled veteran means:
    (i) A veteran who is entitled to compensation (or who but for the 
receipt of military retired pay would be entitled to compensation) 
under laws administered by the Department of Veterans Affairs for a 
disability:
    (A) Rated at 30 percent or more; or
    (B) Rated at 10 or 20 percent in the case of a veteran who has been 
determined under 38 U.S.C. 3106 to have a serious employment handicap; 
or
    (ii) A person who was discharged or released from active duty 
because of a service-connected disability.
    (2) Veteran of the Vietnam Era means a person who:
    (i) Served on active duty for a period of more than 180 days, and 
was discharged or released therefrom with other than a dishonorable 
discharge, if any part of such active duty occurred:
    (A) In the Republic of Vietnam between February 28, 1961, and May 
7, 1975; or
    (B) Between August 5, 1964, and May 7, 1975, in all other cases; or
    (ii) Was discharged or released from active duty for a service-
connected disability if any part of such active duty was performed:
    (A) In the Republic of Vietnam between February 28, 1961, and May 
7, 1975; or
    (B) Between August 5, 1964, and May 7, 1975, in all other cases.
    (3) Pre-JVA recently separated veteran means a pre-JVA veteran 
during the one-year period beginning on the date of the pre-JVA 
veteran's discharge or release from active duty.
    (4) Other protected veteran means a person who served on active 
duty during a war or in a campaign or expedition for which a campaign 
badge has been authorized, under the laws administered by the 
Department of Defense.
    (p) Prime contractor means any person holding a contract of 
$100,000 or more, and, for the purposes of subpart D of this part, 
``General Enforcement and Complaint Procedures,'' includes any person 
who has held a contract subject to the Act.
    (q) Protected veteran means a veteran who is protected under the 
non-discrimination and affirmative action provisions of the Act; 
specifically, a veteran who may be classified as a ``disabled 
veteran,'' ``recently separated veteran,'' ``active duty wartime or 
campaign badge veteran,'' or an ``Armed Forces service medal veteran,'' 
as defined by this section.
    (r) Qualification standards means the personal and professional 
attributes including the skill, experience, education, physical, 
medical, safety and other requirements established by the contractor as 
requirements which an individual must meet in order to be eligible for 
the position held or desired.
    (s) Qualified disabled veteran means a disabled veteran who has the 
ability to perform the essential functions of the employment position 
with or without reasonable accommodation.
    (t) Reasonable accommodation--(1) The term reasonable accommodation 
means:
    (i) Modifications or adjustments to a job application process that 
enable a qualified applicant who is a disabled veteran to be considered 
for the position such applicant desires; \1\ or
---------------------------------------------------------------------------

    \1\ A contractor's duty to provide a reasonable accommodation 
with respect to applicants who are disabled veterans is not limited 
to those who ultimately demonstrate that they are qualified to 
perform the job in issue. Disabled veteran applicants must be 
provided a reasonable accommodation with respect to the application 
process if they are qualified with respect to that process (e.g., if 
they present themselves at the correct location and time to fill out 
an application).

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[[Page 58665]]

    (ii) Modifications or adjustments to the work environment, or to 
the manner or circumstances under which the position held or desired is 
customarily performed, that enable a qualified disabled veteran to 
perform the essential functions of that position; or
    (iii) Modifications or adjustments that enable the contractor's 
employee who is a disabled veteran to enjoy equal benefits and 
privileges of employment as are enjoyed by the contractor's other 
similarly situated employees who are not disabled veterans.
    (2) Reasonable accommodation may include but is not limited to:
    (i) Making existing facilities used by employees readily accessible 
to and usable by disabled veterans; and
    (ii) Job restructuring; part-time or modified work schedules; 
reassignment to a vacant position; acquisition or modifications of 
equipment or devices; appropriate adjustment or modifications of 
examinations, training materials, or policies; the provision of 
qualified readers or interpreters; and other similar accommodations for 
disabled veterans.
    (3) To determine the appropriate reasonable accommodation it may be 
necessary for the contractor to initiate an informal, interactive 
process with the qualified disabled veteran in need of the 
accommodation.\2\ This process should identify the precise limitations 
resulting from the disability and potential reasonable accommodations 
that could overcome those limitations. (Appendix A of this part 
provides guidance on a contractor's duty to provide reasonable 
accommodation.)
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    \2\ Contractors must engage in such an interactive process with 
a disabled veteran, whether or not a reasonable accommodation 
ultimately is identified that will make the person a qualified 
individual. Contractors must engage in the interactive process 
because, until they have done so, they may be unable to determine 
whether a reasonable accommodation exists that will result in the 
person being qualified.
---------------------------------------------------------------------------

    (u) Recently separated veteran means any veteran during the three-
year period beginning on the date of such veteran's discharge or 
release from active duty in the U.S. military, ground, naval or air 
service.
    (v) Recruiting and training agency means any person who refers 
workers to any contractor, or who provides or supervises apprenticeship 
or training for employment by any contractor.
    (w) Secretary means the Secretary of Labor, United States 
Department of Labor, or his or her designee.
    (x) Subcontract means any agreement or arrangement between a 
contractor and any person (in which the parties do not stand in the 
relationship of an employer and an employee):
    (1) For the purchase, sale or use of personal property or 
nonpersonal services (including construction) which, in whole or in 
part, is necessary to the performance of any one or more contracts; or
    (2) Under which any portion of the contractor's obligation under 
any one or more contracts is performed, undertaken, or assumed.
    (y) Subcontractor means any person holding a subcontract of 
$100,000 or more and, for the purposes of subpart D of this part, 
``General Enforcement and Complaint Procedures,'' any person who has 
held a subcontract subject to the Act.
    (z) TAP means the Department of Defense's Transition Assistance 
Program, or any successor programs thereto. The TAP was designed to 
smooth the transition of military personnel and family members leaving 
active duty via employment workshops and individualized employment 
assistance and training.
    (aa) Undue hardship--(1) In general. Undue hardship means, with 
respect to the provision of an accommodation, significant difficulty or 
expense incurred by the contractor, when considered in light of the 
factors set forth in paragraph (2) of this section.
    (2) Factors to be considered. In determining whether an 
accommodation would impose an undue hardship on the contractor, factors 
to be considered include:
    (i) The nature and net cost of the accommodation needed, taking 
into consideration the availability of tax credits and deductions, and/
or outside funding;
    (ii) The overall financial resources of the facility or facilities 
involved in the provision of the reasonable accommodation, the number 
of persons employed at such facility, and the effect on expenses and 
resources;
    (iii) The overall financial resources of the contractor, the 
overall size of the business of the contractor with respect to the 
number of its employees, and the number, type and location of its 
facilities;
    (iv) The type of operation or operations of the contractor, 
including the composition, structure and functions of the work force of 
such contractor, and the geographic separateness and administrative or 
fiscal relationship of the facility or facilities in question to the 
contractor; and
    (v) The impact of the accommodation upon the operation of the 
facility, including the impact on the ability of other employees to 
perform their duties and the impact on the facility's ability to 
conduct business.
    (bb) United States, as used in this part, shall include the several 
States, the District of Columbia, the Virgin Islands, the Commonwealth 
of Puerto Rico, Guam, American Samoa, the Commonwealth of the Northern 
Mariana Islands, and Wake Island.
    (cc) Veteran means a person who served in the active military, 
naval, or air service of the United States, and who was discharged or 
released therefrom under conditions other than dishonorable.


Sec.  60-300.3  [Reserved]


Sec.  60-300.4  Coverage and waivers.

    (a) General--(1) Contracts and subcontracts of $100,000 or more. 
Contracts and subcontracts of $100,000 or more are covered by this 
part. No contracting agency or contractor shall procure supplies or 
services in less than usual quantities to avoid the applicability of 
the equal opportunity clause.
    (2) Contracts for indefinite quantities. With respect to indefinite 
delivery-type contracts (including, but not limited to, open end 
contracts, requirement-type contracts, Federal Supply Schedule 
contracts, ``call-type'' contracts, and purchase notice agreements), 
the equal opportunity clause shall be included unless the contracting 
agency has reason to believe that the amount to be ordered in any year 
under such contract will be less than $100,000. The applicability of 
the equal opportunity clause shall be determined at the time of award 
for the first year, and annually thereafter for succeeding years, if 
any. Notwithstanding the above, the equal opportunity clause shall be 
applied to such contract whenever the amount of a single order is 
$100,000 or more. Once the equal opportunity clause is determined to be 
applicable, the contract shall continue to be subject to such clause 
for its duration, regardless of the amounts ordered, or reasonably 
expected to be ordered in any year.
    (3) Employment activities within the United States. This part 
applies only to employment activities within the United States and not 
to employment activities abroad. The term ``employment activities 
within the United States'' includes actual employment within the United 
States, and decisions of the contractor made

[[Page 58666]]

within the United States pertaining to the contractor's applicants and 
employees who are within the United States, regarding employment 
opportunities abroad (such as recruiting and hiring within the United 
States for employment abroad, or transfer of persons employed in the 
United States to contractor establishments abroad).
    (4) Contracts with State or local governments. The requirements of 
the equal opportunity clause in any contract or subcontract with a 
State or local government (or any agency, instrumentality or 
subdivision thereof) shall not be applicable to any agency, 
instrumentality or subdivision of such government which does not 
participate in work on or under the contract or subcontract.
    (b) Waivers--(1) Specific contracts and classes of contracts. The 
Director may waive the application to any contract of the equal 
opportunity clause in whole or part when he or she deems that special 
circumstances in the national interest so require. The Director may 
also grant such waivers to groups or categories of contracts: Where it 
is in the national interest; where it is found impracticable to act 
upon each request individually; and where such waiver will 
substantially contribute to convenience in administration of the Act. 
When a waiver has been granted for any class of contracts, the Director 
may withdraw the waiver for a specific contract or group of contracts 
to be awarded, when in his or her judgment such action is necessary or 
appropriate to achieve the purposes of the Act. The withdrawal shall 
not apply to contracts awarded prior to the withdrawal, except that in 
procurements entered into by formal advertising, or the various forms 
of restricted formal advertising, such withdrawal shall not apply 
unless the withdrawal is made more than 10 calendar days before the 
date set for the opening of the bids.
    (2) National security. Any requirement set forth in the regulations 
of this part shall not apply to any contract whenever the head of the 
contracting agency determines that such contract is essential to the 
national security and that its award without complying with such 
requirements is necessary to the national security. Upon making such a 
determination, the head of the contracting agency will notify the 
Director in writing within 30 days.
    (3) Facilities not connected with contracts. The Director may waive 
the requirements of the equal opportunity clause with respect to any of 
a contractor's facilities which he or she finds to be in all respects 
separate and distinct from activities of the contractor related to the 
performance of the contract, provided that he or she also finds that 
such a waiver will not interfere with or impede the effectuation of the 
Act. Such waivers shall be considered only upon the request of the 
contractor.


Sec.  60-300.5  Equal opportunity clause.

    (a) Government contracts. Each contracting agency and each 
contractor shall include the following equal opportunity clause in each 
of its covered Government contracts or subcontracts (and modifications, 
renewals, or extensions thereof if not included in the original 
contract):

EQUAL OPPORTUNITY FOR VEVRAA PROTECTED VETERANS \3\
---------------------------------------------------------------------------

    \3\ The definitions set forth in 41 CFR 60-300.2 apply to the 
terms used throughout this Clause, and they are incorporated herein 
by reference.
---------------------------------------------------------------------------

    1. The contractor will not discriminate against any employee or 
applicant for employment because he or she is a disabled veteran, 
recently separated veteran, active duty wartime or campaign badge 
veteran, or Armed Forces service medal veteran (hereinafter 
collectively referred to as ``protected veteran(s)'') in regard to 
any position for which the employee or applicant for employment is 
qualified. The contractor agrees to take affirmative action to 
employ, advance in employment and otherwise treat qualified 
individuals without discrimination based on their status as a 
protected veteran in all employment practices, including the 
following:
    i. Recruitment, advertising, and job application procedures.
    ii. Hiring, upgrading, promotion, award of tenure, demotion, 
transfer, layoff, termination, right of return from layoff and 
rehiring.
    iii. Rates of pay or any other form of compensation and changes 
in compensation.
    iv. Job assignments, job classifications, organizational 
structures, position descriptions, lines of progression, and 
seniority lists.
    v. Leaves of absence, sick leave, or any other leave.
    vi. Fringe benefits available by virtue of employment, whether 
or not administered by the contractor.
    vii. Selection and financial support for training, including 
apprenticeship, and on-the-job training under 38 U.S.C. 3687, 
professional meetings, conferences, and other related activities, 
and selection for leaves of absence to pursue training.
    viii. Activities sponsored by the contractor including social or 
recreational programs.
    ix. Any other term, condition, or privilege of employment.
    2. The contractor agrees to immediately list all employment 
openings which exist at the time of the execution of this contract 
and those which occur during the performance of this contract, 
including those not generated by this contract and including those 
occurring at an establishment of the contractor other than the one 
where the contract is being performed, but excluding those of 
independently operated corporate affiliates, with the appropriate 
employment service delivery system where the opening occurs. Listing 
employment openings with the state workforce agency job bank or with 
the local employment service delivery system where the opening 
occurs will satisfy the requirement to list jobs with the 
appropriate employment service delivery system. In order to satisfy 
the listing requirement described herein, contractors must provide 
information about the job vacancy in any manner and format permitted 
by the appropriate employment service delivery system which will 
allow that system to provide priority referral of veterans protected 
by VEVRAA for that job vacancy. Providing information on employment 
openings to a privately run job service or exchange will satisfy the 
contractor's listing obligation if the privately run job service or 
exchange provides the information to the appropriate employment 
service delivery system in any manner and format that the employment 
service delivery system permits which will allow that system to 
provide priority referral of protected veterans.
    3. Listing of employment openings with the appropriate 
employment service delivery system pursuant to this clause shall be 
made at least concurrently with the use of any other recruitment 
source or effort and shall involve the normal obligations which 
attach to the placing of a bona fide job order, including the 
acceptance of referrals of veterans and nonveterans. The listing of 
employment openings does not require the hiring of any particular 
job applicants or from any particular group of job applicants, and 
nothing herein is intended to relieve the contractor from any 
requirements in Executive orders or regulations regarding 
nondiscrimination in employment.
    4. Whenever a contractor, other than a state or local 
governmental contractor, becomes contractually bound to the listing 
provisions in paragraphs 2 and 3 of this clause, it shall advise the 
employment service delivery system in each state where it has 
establishments that: (a) It is a Federal contractor, so that the 
employment service delivery systems are able to identify them as 
such; and (b) it desires priority referrals from the state of 
protected veterans for job openings at all locations within the 
state. The contractor shall also provide to the employment service 
delivery system the name and location of each hiring location within 
the state and the contact information for the contractor official 
responsible for hiring at each location. The ``contractor official'' 
may be a chief hiring official, a Human Resources contact, a senior 
management contact, or any other manager for the contractor that can 
verify the information set forth in the job listing and receive 
priority referrals from employment service delivery systems. In the 
event that the contractor uses any external job search organizations 
to assist in its hiring, the contractor shall also provide to the 
employment service delivery system the contact information for the 
job search organization(s). The disclosures required by this 
paragraph shall be made simultaneously

[[Page 58667]]

with the contractor's first job listing at each employment service 
delivery system location after the effective date of this final 
rule. Should any of the information in the disclosures change since 
it was last reported to the employment service delivery system 
location, the contractor shall provide updated information 
simultaneously with its next job listing. As long as the contractor 
is contractually bound to these provisions and has so advised the 
employment service delivery system, there is no need to advise the 
employment service delivery system of subsequent contracts. The 
contractor may advise the employment service delivery system when it 
is no longer bound by this contract clause.
    5. The provisions of paragraphs 2 and 3 of this clause do not 
apply to the listing of employment openings which occur and are 
filled outside of the 50 states, the District of Columbia, the 
Commonwealth of Puerto Rico, Guam, the Virgin Islands, American 
Samoa, the Commonwealth of the Northern Mariana Islands, Wake 
Island, and the Trust Territories of the Pacific Islands.
    6. As used in this clause: i. All employment openings includes 
all positions except executive and senior management, those 
positions that will be filled from within the contractor's 
organization, and positions lasting three days or less. This term 
includes full-time employment, temporary employment of more than 
three days' duration, and part-time employment.
    ii. Executive and senior management means: (1) Any employee (a) 
compensated on a salary basis at a rate of not less than $455 per 
week (or $380 per week, if employed in American Samoa by employers 
other than the Federal Government), exclusive of board, lodging or 
other facilities; (b) whose primary duty is management of the 
enterprise in which the employee is employed or of a customarily 
recognized department or subdivision thereof; (c) who customarily 
and regularly directs the work of two or more other employees; and 
(d) who has the authority to hire or fire other employees or whose 
suggestions and recommendations as to the hiring, firing, 
advancement, promotion or any other change of status of other 
employees are given particular weight; or (2) any employee who owns 
at least a bona fide 20-percent equity interest in the enterprise in 
which the employee is employed, regardless of whether the business 
is a corporate or other type of organization, and who is actively 
engaged in its management.
    iii. Positions that will be filled from within the contractor's 
organization means employment openings for which no consideration 
will be given to persons outside the contractor's organization 
(including any affiliates, subsidiaries, and parent companies) and 
includes any openings which the contractor proposes to fill from 
regularly established ``recall'' lists. The exception does not apply 
to a particular opening once an employer decides to consider 
applicants outside of his or her own organization.
    7. The contractor agrees to comply with the rules, regulations, 
and relevant orders of the Secretary of Labor issued pursuant to the 
Act.
    8. In the event of the contractor's noncompliance with the 
requirements of this clause, actions for noncompliance may be taken 
in accordance with the rules, regulations, and relevant orders of 
the Secretary of Labor issued pursuant to the Act.
    9. The contractor agrees to post in conspicuous places, 
available to employees and applicants for employment, notices in a 
form to be prescribed by the Director, Office of Federal Contract 
Compliance Programs, provided by or through the contracting officer. 
Such notices shall state the rights of applicants and employees as 
well as the contractor's obligation under the law to take 
affirmative action to employ and advance in employment qualified 
employees and applicants who are protected veterans. The contractor 
must ensure that applicants or employees who are disabled veterans 
are provided the notice in a form that is accessible and 
understandable to the disabled veteran (e.g., providing Braille or 
large print versions of the notice, posting the notice for visual 
accessibility to persons in wheelchairs, providing the notice 
electronically or on computer disc, or other versions). With respect 
to employees who do not work at a physical location of the 
contractor, a contractor will satisfy its posting obligations by 
posting such notices in an electronic format, provided that the 
contractor provides computers that can access the electronic posting 
to such employees, or the contractor has actual knowledge that such 
employees otherwise are able to access the electronically posted 
notices. Electronic notices for employees must be posted in a 
conspicuous location and format on the company's intranet or sent by 
electronic mail to employees. An electronic posting must be used by 
the contractor to notify job applicants of their rights if the 
contractor utilizes an electronic application process. Such 
electronic applicant notice must be conspicuously stored with, or as 
part of, the electronic application.
    10. The contractor will notify each labor organization or 
representative of workers with which it has a collective bargaining 
agreement or other contract understanding that the contractor is 
bound by the terms of VEVRAA, and is committed to take affirmative 
action to employ and advance in employment, and shall not 
discriminate against, protected veterans.
    11. The contractor will include the provisions of this clause in 
every subcontract or purchase order of $100,000 or more, unless 
exempted by the rules, regulations, or orders of the Secretary 
issued pursuant to VEVRAA so that such provisions will be binding 
upon each subcontractor or vendor. The contractor will take such 
action with respect to any subcontract or purchase order as the 
Director, Office of Federal Contract Compliance Programs, may direct 
to enforce such provisions, including action for noncompliance.
    12. The contractor must, in all solicitations or advertisements 
for employees placed by or on behalf of the contractor, state that 
all qualified applicants will receive consideration for employment 
without regard to their protected veteran status.


[End of Clause]

    (b) Subcontracts. Each contractor shall include the equal 
opportunity clause in each of its subcontracts subject to this part.
    (c) Adaptation of language. Such necessary changes in language may 
be made to the equal opportunity clause as must be appropriate to 
identify properly the parties and their undertakings.
    (d) Inclusion of the equal opportunity clause in the contract. It 
is not necessary to include the equal opportunity clause verbatim in 
the contract. The clause shall be made a part of the contract by 
citation to 41 CFR 60-300.5(a) and inclusion of the following language, 
in bold text, after the citation: ``This contractor and subcontractor 
shall abide by the requirements of 41 CFR 60-300.5(a). This regulation 
prohibits discrimination against qualified protected veterans, and 
requires affirmative action by covered prime contractors and 
subcontractors to employ and advance in employment qualified protected 
veterans.''
    (e) Incorporation by operation of the Act. By operation of the Act, 
the equal opportunity clause shall be considered to be a part of every 
contract and subcontract required by the Act and the regulations in 
this part to include such a clause, whether or not it is physically 
incorporated in such contract and whether or not there is a written 
contract between the agency and the contractor.
    (f) Duties of contracting agencies. Each contracting agency shall 
cooperate with the Director and the Secretary in the performance of 
their responsibilities under the Act. Such cooperation shall include 
insuring that the equal opportunity clause is included in all covered 
Government contracts and that contractors are fully informed of their 
obligations under the Act and this part, providing the Director with 
any information which comes to the agency's attention that a contractor 
is not in compliance with the Act or this part, responding to requests 
for information from the Director, and taking such actions for 
noncompliance as are set forth in Sec.  60-300.66 as may be ordered by 
the Secretary or the Director.

Subpart B--Discrimination Prohibited


Sec.  60-300.20  Covered employment activities.

    The prohibition against discrimination in this part applies to the 
following employment activities:
    (a) Recruitment, advertising, and job application procedures;
    (b) Hiring, upgrading, promotion, award of tenure, demotion, 
transfer, layoff, termination, right of return from layoff, and 
rehiring;

[[Page 58668]]

    (c) Rates of pay or any other form of compensation and changes in 
compensation;
    (d) Job assignments, job classifications, organizational 
structures, position descriptions, lines of progression, and seniority 
lists;
    (e) Leaves of absence, sick leave, or any other leave;
    (f) Fringe benefits available by virtue of employment, whether or 
not administered by the contractor;
    (g) Selection and financial support for training, including, 
apprenticeships, professional meetings, conferences and other related 
activities, and selection for leaves of absence to pursue training;
    (h) Activities sponsored by the contractor including social and 
recreational programs; and
    (i) Any other term, condition, or privilege of employment.


Sec.  60-300.21  Prohibitions.

    The term discrimination includes, but is not limited to, the acts 
described in this section and Sec.  60-300.23.
    (a) Disparate treatment. It is unlawful for the contractor to deny 
an employment opportunity or benefit or otherwise to discriminate 
against a qualified individual because of that individual's status as a 
protected veteran or pre-JVA veteran.
    (b) Limiting, segregating and classifying. Unless otherwise 
permitted by this part, it is unlawful for the contractor to limit, 
segregate, or classify a job applicant or employee in a way that 
adversely affects his or her employment opportunities or status on the 
basis of that individual's status as a protected veteran or pre-JVA 
veteran. For example, the contractor may not segregate protected 
veterans as a whole, or any classification of protected veterans or 
pre-JVA veterans, into separate work areas or into separate lines of 
advancement.
    (c) Contractual or other arrangements--(1) In general. It is 
unlawful for the contractor to participate in a contractual or other 
arrangement or relationship that has the effect of subjecting the 
contractor's own qualified applicant or employee who is a protected 
veteran or pre-JVA veteran to the discrimination prohibited by this 
part.
    (2) Contractual or other arrangement defined. The phrase 
``contractual or other arrangement or relationship'' includes, but is 
not limited to, a relationship with: an employment or referral agency; 
a labor organization, including a collective bargaining agreement; an 
organization providing fringe benefits to an employee of the 
contractor; or an organization providing training and apprenticeship 
programs.
    (3) Application. This paragraph (c) applies to the contractor, with 
respect to its own applicants or employees, whether the contractor 
offered the contract or initiated the relationship, or whether the 
contractor accepted the contract or acceded to the relationship. The 
contractor is not liable for the actions of the other party or parties 
to the contract which only affect that other party's employees or 
applicants.
    (d) Standards, criteria or methods of administration. It is 
unlawful for the contractor to use standards, criteria, or methods of 
administration, that are not job-related and consistent with business 
necessity, and that:
    (1) Have the effect of discriminating on the basis of status as a 
protected veteran or pre-JVA veteran; or
    (2) Perpetuate the discrimination of others who are subject to 
common administrative control.
    (e) Relationship or association with a protected veteran. It is 
unlawful for the contractor to exclude or deny equal jobs or benefits 
to, or otherwise discriminate against, a qualified individual because 
of the known protected veteran or pre-JVA veteran status of an 
individual with whom the qualified individual is known to have a 
family, business, social or other relationship or association.
    (f) Not making reasonable accommodation. (1) It is unlawful for the 
contractor to fail to make reasonable accommodation to the known 
physical or mental limitations of an applicant or employee who is a 
qualified disabled veteran or pre-JVA special disabled veteran, unless 
such contractor can demonstrate that the accommodation would impose an 
undue hardship on the operation of its business.
    (2) It is unlawful for the contractor to deny employment 
opportunities to an applicant or employee who is a qualified disabled 
veteran or pre-JVA special disabled veteran based on the need of such 
contractor to make reasonable accommodation to such an individual's 
physical or mental impairments.
    (3) A qualified disabled veteran or pre-JVA special disabled 
veteran is not required to accept an accommodation, aid, service, 
opportunity or benefit which such qualified individual chooses not to 
accept. However, if such individual rejects a reasonable accommodation, 
aid, service, opportunity or benefit that is necessary to enable the 
individual to perform the essential functions of the position held or 
desired, and cannot, as a result of that rejection, perform the 
essential functions of the position, the individual will not be 
considered a qualified disabled veteran or pre-JVA special disabled 
veteran.
    (g) Qualification standards, tests and other selection criteria--
(1) In general. It is unlawful for the contractor to use qualification 
standards, employment tests or other selection criteria that screen out 
or tend to screen out individuals on the basis of their status as 
protected veterans or pre-JVA veterans unless the standard, test or 
other selection criterion, as used by the contractor, is shown to be 
job-related for the position in question and is consistent with 
business necessity. Selection criteria that concern an essential 
function may not be used to exclude a disabled veteran if that 
individual could satisfy the criteria with provision of a reasonable 
accommodation. Selection criteria that exclude or tend to exclude 
individuals on the basis of their status as protected veterans or pre-
JVA veterans but concern only marginal functions of the job would not 
be consistent with business necessity. The contractor may not refuse to 
hire an applicant who is a disabled veteran or pre-JVA special disabled 
veteran because the applicant's disability prevents him or her from 
performing marginal functions. When considering a protected veteran or 
pre-JVA veteran for an employment opportunity, the contractor may not 
rely on portions of such veteran's military record, including his or 
her discharge papers, which are not relevant to the qualification 
requirements of the opportunity in issue.
    (2) The Uniform Guidelines on Employee Selection Procedures, 41 CFR 
part 60-3, do not apply to 38 U.S.C. 4212 and are similarly 
inapplicable to this part.
    (h) Administration of tests. It is unlawful for the contractor to 
fail to select and administer tests concerning employment in the most 
effective manner to ensure that, when a test is administered to a job 
applicant or employee who is a disabled veteran or pre-JVA special 
disabled veteran with a disability that impairs sensory, manual, or 
speaking skills, the test results accurately reflect the skills, 
aptitude, or whatever other factor of the applicant or employee that 
the test purports to measure, rather than reflecting the impaired 
sensory, manual, or speaking skills of such employee or applicant, 
except where such skills are the factors that the test purports to 
measure.
    (i) Compensation. In offering employment or promotions to protected 
veterans or pre-JVA veterans, it is unlawful for the contractor to 
reduce the amount of compensation offered

[[Page 58669]]

because of any income based upon a disability-related and/or military-
service-related pension or other disability-related and/or military-
service-related benefit the applicant or employee receives from another 
source.


Sec.  60-300.22  Direct threat defense.

    The contractor may use as a qualification standard the requirement 
that an individual be able to perform the essential functions of the 
position held or desired without posing a direct threat to the health 
or safety of the individual or others in the workplace. (See Sec.  60-
300.2(g) defining direct threat.).


Sec.  60-300.23  Medical examinations and inquiries.

    (a) Prohibited medical examinations or inquiries. Except as stated 
in paragraphs (b) and (c) of this section, it is unlawful for the 
contractor to require a medical examination of an applicant or employee 
or to make inquiries as to whether an applicant or employee is a 
disabled veteran or as to the nature or severity of such a veteran's 
disability.
    (b) Permitted medical examinations and inquiries--(1) Acceptable 
pre-employment inquiry. The contractor may make pre-employment 
inquiries into the ability of an applicant to perform job-related 
functions, and/or may ask an applicant to describe or to demonstrate 
how, with or without reasonable accommodation, the applicant will be 
able to perform job-related functions.
    (2) Employment entrance examination. The contractor may require a 
medical examination (and/or inquiry) after making an offer of 
employment to a job applicant and before the applicant begins his or 
her employment duties, and may condition an offer of employment on the 
results of such examination (and/or inquiry), if all entering employees 
in the same job category are subjected to such an examination (and/or 
inquiry) regardless of their status as a disabled veteran.
    (3) Examination of employees. The contractor may require a medical 
examination (and/or inquiry) of an employee that is job-related and 
consistent with business necessity. The contractor may make inquiries 
into the ability of an employee to perform job-related functions.
    (4) Other acceptable examinations and inquiries. The contractor may 
conduct voluntary medical examinations and activities, including 
voluntary medical histories, which are part of an employee health 
program available to employees at the work site.
    (5) Medical examinations conducted in accordance with paragraphs 
(b)(2) and (b)(4) of this section do not have to be job-related and 
consistent with business necessity. However, if certain criteria are 
used to screen out an applicant or applicants or an employee or 
employees who are disabled veterans as a result of such examinations or 
inquiries, the contractor must demonstrate that the exclusionary 
criteria are job-related and consistent with business necessity, and 
that performance of the essential job functions cannot be accomplished 
with reasonable accommodations as required in this part.
    (c) Invitation to self-identify. The contractor shall invite 
applicants to self-identify as being covered by the Act, as specified 
in Sec.  60-300.42.
    (d) Confidentiality and use of medical information. (1) Information 
obtained under this section regarding the medical condition or history 
of any applicant or employee shall be collected and maintained on 
separate forms and in separate medical files and treated as a 
confidential medical record, except that:
    (i) Supervisors and managers may be informed regarding necessary 
restrictions on the work or duties of the applicant or employee and 
necessary accommodations;
    (ii) First aid and safety personnel may be informed, when 
appropriate, if the disability might require emergency treatment; and
    (iii) Government officials engaged in enforcing the laws 
administered by OFCCP, including this part, or enforcing the Americans 
with Disabilities Act, shall be provided relevant information on 
request.
    (2) Information obtained under this section regarding the medical 
condition or history of any applicant or employee shall not be used for 
any purpose inconsistent with this part.


Sec.  60-300.24  Drugs and alcohol.

    (a) Specific activities permitted. The contractor: (1) May prohibit 
the illegal use of drugs and the use of alcohol at the workplace by all 
employees;
    (2) May require that employees not be under the influence of 
alcohol or be engaging in the illegal use of drugs at the workplace;
    (3) May require that all employees behave in conformance with the 
requirements established under the Drug-Free Workplace Act of 1988 (41 
U.S.C. 701 et seq.);
    (4) May hold an employee who engages in the illegal use of drugs or 
who is an alcoholic to the same qualification standards for employment 
or job performance and behavior to which the contractor holds its other 
employees, even if any unsatisfactory performance or behavior is 
related to the employee's drug use or alcoholism;
    (5) May require that its employees employed in an industry subject 
to such regulations comply with the standards established in the 
regulations (if any) of the Departments of Defense and Transportation, 
and of the Nuclear Regulatory Commission, and other Federal agencies 
regarding alcohol and the illegal use of drugs; and
    (6) May require that employees employed in sensitive positions 
comply with the regulations (if any) of the Departments of Defense and 
Transportation, and of the Nuclear Regulatory Commission, and other 
Federal agencies that apply to employment in sensitive positions 
subject to such regulations.
    (b) Drug testing--(1) General policy. For purposes of this part, a 
test to determine the illegal use of drugs is not considered a medical 
examination. Thus, the administration of such drug tests by the 
contractor to its job applicants or employees is not a violation of 
Sec.  60-300.23. Nothing in this part shall be construed to encourage, 
prohibit, or authorize the contractor to conduct drug tests of job 
applicants or employees to determine the illegal use of drugs or to 
make employment decisions based on such test results.
    (2) Transportation employees. Nothing in this part shall be 
construed to encourage, prohibit, or authorize the otherwise lawful 
exercise by contractors subject to the jurisdiction of the Department 
of Transportation of authority to test employees in, and applicants 
for, positions involving safety-sensitive duties for the illegal use of 
drugs or for on-duty impairment by alcohol; and remove from safety-
sensitive positions persons who test positive for illegal use of drugs 
or on-duty impairment by alcohol pursuant to paragraph (b)(1) of this 
section.
    (3) Any information regarding the medical condition or history of 
any employee or applicant obtained from a test to determine the illegal 
use of drugs, except information regarding the illegal use of drugs, is 
subject to the requirements of Sec. Sec.  60-300.23(b)(5) and 60-
300.23(d)(2).


Sec.  60-300.25  Health insurance, life insurance and other benefit 
plans.

    (a) An insurer, hospital, or medical service company, health 
maintenance organization, or any agent or entity that administers 
benefit plans, or similar organizations may underwrite risks, classify 
risks, or administer such risks that are based on or not inconsistent 
with state law.

[[Page 58670]]

    (b) The contractor may establish, sponsor, observe or administer 
the terms of a bona fide benefit plan that are based on underwriting 
risks, classifying risks, or administering such risks that are based on 
or not inconsistent with state law.
    (c) The contractor may establish, sponsor, observe, or administer 
the terms of a bona fide benefit plan that is not subject to state laws 
that regulate insurance.
    (d) The contractor shall not deny a qualified disabled veteran 
equal access to insurance or subject a qualified disabled veteran to 
different terms or conditions of insurance based on disability alone, 
if the disability does not pose increased risks.
    (e) The activities described in paragraphs (a), (b) and (c) of this 
section are permitted unless these activities are used as a subterfuge 
to evade the purposes of this part.

Subpart C--Affirmative Action Program


Sec.  60-300.40  Applicability of the affirmative action program 
requirement.

    (a) The requirements of this subpart apply to every Government 
contractor that has 50 or more employees and a contract of $100,000 or 
more.
    (b) Contractors described in paragraph (a) of this section shall, 
within 120 days of the commencement of a contract, prepare and maintain 
an affirmative action program at each establishment. The affirmative 
action program shall set forth the contractor's policies and procedures 
in accordance with this part. This program may be integrated into or 
kept separate from other affirmative action programs.
    (c) The affirmative action program shall be reviewed and updated 
annually by the official designated by the contractor pursuant to Sec.  
60-300.44(i).
    (d) The contractor shall submit the affirmative action program 
within 30 days of a request from OFCCP, unless the request provides for 
a different time. The contractor also shall make the affirmative action 
program promptly available on-site upon OFCCP's request.


Sec.  60-300.41  Availability of affirmative action program.

    The full affirmative action program, absent the data metrics 
required by Sec.  60-300.44(k), shall be made available to any employee 
or applicant for employment for inspection upon request. The location 
and hours during which the program may be obtained shall be posted at 
each establishment.


Sec.  60-300.42  Invitation to self-identify.

    (a) Pre-offer. The contractor shall invite applicants to inform the 
contractor whether the applicant believes that he or she is a protected 
veteran who may be covered by the Act. This invitation may be included 
in the application materials for the position, but in any circumstance 
shall be provided to applicants prior to making an offer of employment 
to a job applicant.
    (b) Post-offer. In addition to the invitation in paragraph (a) of 
this section, the contractor shall invite applicants to inform the 
contractor whether the applicant believes that he or she belongs to one 
or more of the specific categories of protected veteran for which the 
contractor is required to report pursuant to 41 CFR part 61-300. Such 
an invitation shall be made at any time after the offer of employment 
but before the applicant begins his or her job duties.
    (c) The invitations referenced in paragraphs (a) and (b) of this 
section shall state that the contractor is a Federal contractor 
required to take affirmative action to employ and advance in employment 
protected veterans pursuant to the Act. The invitations also shall 
summarize the relevant portions of the Act and the contractor's 
affirmative action program. Furthermore, the invitations shall state 
that the information is being requested on a voluntary basis, that it 
will be kept confidential, that refusal to provide it will not subject 
the applicant to any adverse treatment, and that it will not be used in 
a manner inconsistent with the act. (An acceptable form for such an 
invitation is set forth in Appendix B of this part.)
    (d) If an applicant identifies himself or herself as a disabled 
veteran in the post-offer self-identification detailed in paragraph (b) 
of this section, the contractor should inquire of the applicant whether 
an accommodation is necessary, and if so, should engage with the 
applicant regarding reasonable accommodation. The contractor may make 
such inquiries to the extent they are consistent with the Americans 
with Disabilities Act of 1990 (ADA), 42 U.S.C. 12101, et seq. The 
contractor shall maintain a separate file in accordance with Sec.  60-
300.23(d) on persons who have self-identified as disabled veterans.
    (e) The contractor shall keep all information on self-
identification confidential. The contractor shall provide the 
information to OFCCP upon request. This information may be used only in 
accordance with this part.
    (f) Nothing in this section relieves the contractor of its 
obligation to take affirmative action with respect to those applicants 
or employees who are known to the contractor to be protected veterans.
    (g) Nothing in this section relieves the contractor from liability 
for discrimination under the Act.


Sec.  60-300.43  Affirmative action policy.

    Under the affirmative action obligations imposed by the Act, 
contractors shall not discriminate against protected veterans, and 
shall take affirmative action to employ and advance in employment 
qualified protected veterans at all levels of employment, including the 
executive level. Such action shall apply to all employment activities 
set forth in Sec.  60-300.20.


Sec.  60-300.44  Required contents of affirmative action programs.

    Acceptable affirmative action programs shall contain, but not 
necessarily be limited to, the following elements:
    (a) Policy statement. The contractor shall include an equal 
opportunity policy statement in its affirmative action program, and 
shall post the policy statement on company bulletin boards. The 
contractor must ensure that applicants and employees who are disabled 
veterans are provided the notice in a form that is accessible and 
understandable to the disabled veteran (e.g., providing Braille or 
large print versions of the notice, or posting the notice for visual 
accessibility to persons in wheelchairs). The policy statement shall 
indicate the top United States executive's (such as the Chief Executive 
Officer or the President of the United States Division of a foreign 
company) support for the contractor's affirmative action program, 
provide for an audit and reporting system (see paragraph (h) of this 
section) and assign overall responsibility for the implementation of 
affirmative action activities required under this part (see paragraph 
(i) of this section). Additionally, the policy shall state, among other 
things, that the contractor will: recruit, hire, train and promote 
persons in all job titles, and ensure that all other personnel actions 
are administered, without regard to protected veteran status; and 
ensure that all employment decisions are based only on valid job 
requirements. The policy shall state that employees and applicants 
shall not be subjected to harassment, intimidation, threats, coercion 
or discrimination because they have engaged in or may engage in any of 
the following activities:

[[Page 58671]]

    (1) Filing a complaint;
    (2) Assisting or participating in an investigation, compliance 
evaluation, hearing, or any other activity related to the 
administration of the affirmative action provisions of VEVRAA or any 
other Federal, state or local law requiring equal opportunity for 
protected veterans;
    (3) Opposing any act or practice made unlawful by VEVRAA or its 
implementing regulations in this part or any other Federal, state or 
local law requiring equal opportunity for protected veterans; or
    (4) Exercising any other right protected by VEVRAA or its 
implementing regulations in this part.
    (b) Review of personnel processes. The contractor shall ensure that 
its personnel processes provide for careful, thorough, and systematic 
consideration of the job qualifications of applicants and employees who 
are known protected veterans for job vacancies filled either by hiring 
or promotion, and for all training opportunities offered or available. 
The contractor shall ensure that when a protected veteran is considered 
for employment opportunities, the contractor relies only on that 
portion of the individual's military record, including his or her 
discharge papers, relevant to the requirements of the opportunity in 
issue. The contractor shall ensure that its personnel processes do not 
stereotype protected veterans in a manner which limits their access to 
all jobs for which they are qualified. The contractor shall 
periodically review such processes and make any necessary modifications 
to ensure that these obligations are carried out. A description of the 
review and any necessary modifications to personnel processes or 
development of new processes shall be included in any affirmative 
action programs required under this part. The contractor must design 
procedures that facilitate a review of the implementation of this 
requirement by the contractor and the Government (Appendix C of this 
part is an example of an appropriate set of procedures. The procedures 
in Appendix C are not required and contractors may develop other 
procedures appropriate to their circumstances.)
    (c) Physical and mental qualifications. (1) The contractor shall 
provide in its affirmative action program, and shall adhere to, a 
schedule for the periodic review of all physical and mental job 
qualification standards to ensure that, to the extent qualification 
standards tend to screen out qualified disabled veterans, they are job-
related for the position in question and are consistent with business 
necessity. (2) Whenever the contractor applies physical or mental 
qualification standards in the selection of applicants or employees for 
employment or other change in employment status such as promotion, 
demotion or training, to the extent that qualification standards tend 
to screen out qualified disabled veterans, the standards shall be 
related to the specific job or jobs for which the individual is being 
considered and consistent with business necessity. The contractor has 
the burden to demonstrate that it has complied with the requirements of 
this paragraph (c)(2).
    (3) The contractor may use as a defense to an allegation of a 
violation of paragraph (c)(2) of this section that an individual poses 
a direct threat to the health or safety of the individual or others in 
the workplace. (See Sec.  60-300.2(g) defining direct threat.) (d) 
Reasonable accommodation to physical and mental limitations. As is 
provided in Sec.  60-300.21(f), as a matter of nondiscrimination the 
contractor must make reasonable accommodation to the known physical or 
mental limitations of an otherwise qualified disabled veteran unless it 
can demonstrate that the accommodation would impose an undue hardship 
on the operation of its business. As a matter of affirmative action, if 
an employee who is known to be a disabled veteran is having significant 
difficulty performing his or her job and it is reasonable to conclude 
that the performance problem may be related to the known disability, 
the contractor shall confidentially notify the employee of the 
performance problem and inquire whether the problem is related to the 
employee's disability; if the employee responds affirmatively, the 
contractor shall confidentially inquire whether the employee is in need 
of a reasonable accommodation.
    (e) Harassment. The contractor must develop and implement 
procedures to ensure that its employees are not harassed because of 
their status as a protected veteran.
    (f) External dissemination of policy, outreach and positive 
recruitment.
    (1) Required outreach efforts.
    (i) The contractor shall undertake appropriate outreach and 
positive recruitment activities such as those listed in paragraph 
(f)(2) of this section that are reasonably designed to effectively 
recruit protected veterans. It is not contemplated that the contractor 
will necessarily undertake all the activities listed in paragraph 
(f)(2) of this section or that its activities will be limited to those 
listed. The scope of the contractor's efforts shall depend upon all the 
circumstances, including the contractor's size and resources and the 
extent to which existing employment practices are adequate.
    (ii) The contractor must send written notification of company 
policy related to its affirmative action efforts to all subcontractors, 
including subcontracting vendors and suppliers, requesting appropriate 
action on their part.
    (2) Examples of outreach and recruitment activities . Below are 
examples of outreach and positive recruitment activities referred to in 
paragraph (f)(1) of this section. This is an illustrative list, and 
contractors may choose from these or other activities, as appropriate 
to their circumstances.
    (i) Enlisting the assistance and support of the following persons 
and organizations in recruiting, and developing on-the-job training 
opportunities for veterans, in order to fulfill its commitment to 
provide meaningful employment opportunities for such veterans:
    (A) The Local Veterans' Employment Representative in the local 
employment service office (i.e., the One-Stop) nearest the contractor's 
establishment;
    (B) The Department of Veterans Affairs Regional Office nearest the 
contractor's establishment;
    (C) The veterans' counselors and coordinators (``Vet-Reps'') on 
college campuses;
    (D) The service officers of the national veterans' groups active in 
the area of the contractor's establishment;
    (E) Local veterans' groups and veterans' service centers near the 
contractor's establishment;
    (F) The Department of Defense Transition Assistance Program (TAP), 
or any subsequent program that, in whole or in part, might replace TAP; 
and
    (G) Any organization listed in the Employer Resources section of 
the National Resource Directory (http://www.nationalresourcedirectory.gov/), or any future service that 
replaces or complements it.
    (ii) The contractor should also consider taking the actions listed 
below, as appropriate, to fulfill its commitment to provide meaningful 
employment opportunities to protected veterans:
    (A) Formal briefing sessions should be held, preferably on company 
premises, with representatives from recruiting sources. Contractor 
facility tours, clear and concise explanations of current and future 
job openings, position descriptions, worker specifications, 
explanations of the company's selection process, and recruiting 
literature should be an integral part of the briefing. At any

[[Page 58672]]

such briefing sessions, the company official in charge of the 
contractor's affirmative action program should be in attendance when 
possible. Formal arrangements should be made for referral of 
applicants, follow up with sources, and feedback on disposition of 
applicants.
    (B) The contractor's recruitment efforts at all educational 
institutions should incorporate special efforts to reach students who 
are protected veterans.
    (C) An effort should be made to participate in work-study programs 
with Department of Veterans Affairs rehabilitation facilities which 
specialize in training or educating disabled veterans.
    (D) Protected veterans should be made available for participation 
in career days, youth motivation programs, and related activities in 
their communities.
    (E) The contractor should take any other positive steps it deems 
necessary to attract qualified protected veterans not currently in the 
work force who have requisite skills and can be recruited through 
affirmative action measures. These persons may be located through the 
local chapters of organizations of and for any of the classifications 
of protected veterans.
    (F) The contractor, in making hiring decisions, should consider 
applicants who are known protected veterans for all available positions 
for which they may be qualified when the position(s) applied for is 
unavailable.
    (G) The contractor should consider listing its job openings with 
the National Resource Directory's Veterans Job Bank, or any future 
service that replaces or complements it.
    (3) Assessment of external outreach and recruitment efforts. The 
contractor shall, on an annual basis, review the outreach and 
recruitment efforts it has taken over the previous twelve months to 
evaluate their effectiveness in identifying and recruiting qualified 
protected veterans. The contractor shall document each evaluation, 
including at a minimum the criteria it used to evaluate the 
effectiveness of each effort and the contractor's conclusion as to 
whether each effort was effective. Among these criteria shall be the 
data collected pursuant to paragraph (k) of this section for the 
current year and the two most recent previous years. The contractor's 
conclusion as to the effectiveness of its outreach efforts must be 
reasonable as determined by OFCCP in light of these regulations. If the 
contractor concludes the totality of its efforts were not effective in 
identifying and recruiting qualified protected veterans, it shall 
identify and implement alternative efforts listed in paragraphs (f)(1) 
or (f)(2) of this section in order to fulfill its obligations.
    (4) Recordkeeping obligation. The contractor shall document all 
activities it undertakes to comply with the obligations of this 
section, and retain these documents for a period of three (3) years.
    (g) Internal dissemination of policy. (1) A strong outreach program 
will be ineffective without adequate internal support from supervisory 
and management personnel and other employees. In order to assure 
greater employee cooperation and participation in the contractor's 
efforts, the contractor shall develop the internal procedures listed in 
paragraph (g)(2) of this section for communication of its obligation to 
engage in affirmative action efforts to employ and advance in 
employment qualified protected veterans. It is not contemplated that 
the contractor's activities will be limited to those listed. These 
procedures shall be designed to foster understanding, acceptance and 
support among the contractor's executive, management, supervisory and 
other employees and to encourage such persons to take the necessary 
actions to aid the contractor in meeting this obligation.
    (2) The contractor shall implement and disseminate this policy 
internally as follows:
    (i) Include it in the contractor's policy manual or otherwise make 
the policy available to employees;
    (ii) If the contractor is party to a collective bargaining 
agreement, it shall notify union officials and/or employee 
representatives to inform them of the contractor's policy, and request 
their cooperation;
    (3) The contractor is encouraged to additionally implement and 
disseminate this policy internally as follows:
    (i) Inform all employees and prospective employees of its 
commitment to engage in affirmative action to increase employment 
opportunities for protected veterans;
    (ii) Publicize it in the company newspaper, magazine, annual report 
and other media;
    (iii) Conduct special meetings with executive, management, and 
supervisory personnel to explain the intent of the policy and 
individual responsibility for effective implementation, making clear 
the chief executive officer's support for the affirmative action 
policy;
    (iv) Discuss the policy thoroughly in both employee orientation and 
management training programs;
    (v) When employees are featured in employee handbooks or similar 
publications for employees, include disabled veterans.
    (h) Audit and reporting system. (1) The contractor shall design and 
implement an audit and reporting system that will:
    (i) Measure the effectiveness of the contractor's affirmative 
action program;
    (ii) Indicate any need for remedial action;
    (iii) Determine the degree to which the contractor's objectives 
have been attained;
    (iv) Determine whether known protected veterans have had the 
opportunity to participate in all company sponsored educational, 
training, recreational and social activities;
    (v) Measure the contractor's compliance with the affirmative action 
program's specific obligations; and
    (vi) Document the actions taken to comply with the obligations of 
paragraphs (i) through (v) above, and retain these documents as 
employment records subject to the recordkeeping requirements of Sec.  
60-300.80.
    (2) Where the affirmative action program is found to be deficient, 
the contractor shall undertake necessary action to bring the program 
into compliance.
    (i) Responsibility for implementation. An official of the 
contractor shall be assigned responsibility for implementation of the 
contractor's affirmative action activities under this part. His or her 
identity should appear on all internal and external communications 
regarding the company's affirmative action program. This official shall 
be given necessary senior management support and staff to manage the 
implementation of this program.
    (j) Training. All personnel involved in the recruitment, screening, 
selection, promotion, disciplinary, and related processes shall be 
trained to ensure that the commitments in the contractor's affirmative 
action program are implemented.
    (k) Data collection analysis. The contractor shall document the 
following computations or comparisons pertaining to applicants and 
hires on an annual basis and maintain them for a period of three (3) 
years:
    (1) The number of applicants who self-identified as protected 
veterans pursuant to Sec.  60-300.42(a), or who are otherwise known as 
protected veterans;
    (2) The total number of job openings and total number of jobs 
filled;
    (3) The total number of applicants for all jobs;
    (4) The number of protected veteran applicants hired; and

[[Page 58673]]

    (5) The total number of applicants hired.


Sec.  60-300.45  Benchmarks for hiring.

    The benchmark is not a rigid and inflexible quota which must be 
met, nor is it to be considered either a ceiling or a floor for the 
employment of particular groups. Quotas are expressly forbidden.
    (a) Purpose: The purpose of establishing benchmarks is to create a 
quantifiable method by which the contractor can measure its progress 
toward achieving equal employment opportunity for protected veterans.
    (b) Hiring benchmarks shall be set by the contractor on an annual 
basis. Benchmarks shall be set using one of the two mechanisms 
described below:
    (1) Establish a benchmark equaling the national percentage of 
veterans in the civilian labor force, which will be published and 
updated annually on the OFCCP Web site; or
    (2) Establish a benchmark by taking into account:
    (i) The average percentage of veterans in the civilian labor force 
in the State(s) where the contractor is located over the preceding 
three years, as calculated by the Bureau of Labor Statistics and 
published on the OFCCP Web site;
    (ii) The number of veterans, over the previous four quarters, who 
were participants in the employment service delivery system in the 
State where the contractor is located, as tabulated by the Veterans' 
Employment and Training Service and published on the OFCCP Web site;
    (iii) The applicant ratio and hiring ratio for the previous year, 
based on the data collected pursuant to Sec.  60-300.44(k);
    (iv) The contractor's recent assessments of the effectiveness of 
its external outreach and recruitment efforts, as set forth in Sec.  
60-300.44(f)(3); and
    (v) Any other factors, including but not limited to the nature of 
the contractor's job openings and/or its location, which would tend to 
affect the availability of qualified protected veterans.
    (c) The contractor shall document the hiring benchmark it has 
established each year. If the contractor sets its benchmark using the 
procedure in paragraph (b)(2) of this section, it shall document each 
of the factors that it considered in establishing the hiring benchmark 
and the relative significance of each of these factors. The contractor 
shall retain these records for a period of three (3) years.

Subpart D--General Enforcement and Complaint Procedures


Sec.  60-300.60  Compliance evaluations.

    (a) OFCCP may conduct compliance evaluations to determine if the 
contractor is taking affirmative action to employ, advance in 
employment and otherwise treat qualified individuals without 
discrimination based on their status as a protected veteran in all 
employment practices. A compliance evaluation may consist of any one or 
any combination of the following investigative procedures:
    (1) Compliance review. A comprehensive analysis and evaluation of 
the hiring and employment practices of the contractor, the written 
affirmative action program, and the results of the affirmative action 
efforts undertaken by the contractor. A compliance review may proceed 
in three stages:
    (i) A desk audit of the written affirmative action program and 
supporting documentation to determine whether all elements required by 
the regulations in this part are included, whether the affirmative 
action program meets agency standards of reasonableness, and whether 
the affirmative action program and supporting documentation satisfy 
agency standards of acceptability. OFCCP may extend the temporal scope 
of the desk audit beyond that set forth in the scheduling letter if 
OFCCP deems it necessary to carry out its investigation of potential 
violations of this part. The desk audit is conducted at OFCCP offices;
    (ii) An on-site review, conducted at the contractor's establishment 
to investigate unresolved problem areas identified in the affirmative 
action program and supporting documentation during the desk audit, to 
verify that the contractor has implemented the affirmative action 
program and has complied with those regulatory obligations not required 
to be included in the affirmative action program, and to examine 
potential instances or issues of discrimination. An on-site review 
normally will involve an examination of the contractor's personnel and 
employment policies, inspection and copying of documents related to 
employment actions, and interviews with employees, supervisors, 
managers, hiring officials; and
    (iii) Where necessary, an off-site analysis of information supplied 
by the contractor or otherwise gathered during or pursuant to the on-
site review;
    (2) Off-site review of records. An analysis and evaluation of the 
affirmative action program (or any part thereof) and supporting 
documentation, and other documents related to the contractor's 
personnel policies and employment actions that may be relevant to a 
determination of whether the contractor has complied with the 
requirements of VEVRAA and its regulations;
    (3) Compliance check. A determination of whether the contractor has 
maintained records consistent with Sec.  60-300.80; OFCCP may request 
the documents be provided either on-site or off-site; or
    (4) Focused review. A review restricted to one or more components 
of the contractor's organization or one or more aspects of the 
contractor's employment practices.
    (b) Where deficiencies are found to exist, reasonable efforts shall 
be made to secure compliance through conciliation and persuasion 
pursuant to Sec.  60-300.62.
    (c) Reporting requirements. During a compliance evaluation, OFCCP 
may verify whether the contractor has complied with applicable 
reporting requirements required under regulations promulgated by the 
Veterans' Employment and Training Service (VETS). If the contractor has 
not complied with any such reporting requirement, OFCCP will notify 
VETS.
    (d) Pre-award compliance evaluations. Each agency will include in 
the invitation for bids for each formally advertised nonconstruction 
contract or state at the outset of negotiations for each negotiated 
contract, that if the award, when let, should total $10 million or 
more, the prospective contractor and its known first-tier 
subcontractors with subcontracts of $10 million or more will be subject 
to a compliance evaluation before the award of the contract unless 
OFCCP has conducted an evaluation and found them to be in compliance 
with VEVRAA within the preceding 24 months. The awarding agency will 
notify OFCCP and request appropriate action and findings in accordance 
with this subsection. Within 15 days of the notice OFCCP will inform 
the awarding agency of its intention to conduct a pre-award compliance 
evaluation. If OFCCP does not inform the awarding agency within that 
period of its intention to conduct a pre-award compliance evaluation, 
clearance shall be presumed and the awarding agency is authorized to 
proceed with the award. If OFCCP informs the awarding agency of its 
intention to conduct a pre-award compliance evaluation, OFCCP will be 
allowed an additional 20 days after the date that it so informs the 
awarding agency to provide its conclusions. If OFCCP does not provide 
the awarding agency with its conclusions within that

[[Page 58674]]

period, clearance will be presumed and the awarding agency is 
authorized to proceed with the award.


Sec.  60-300.61  Complaint procedures.

    (a) Place and time of filing. Any applicant for employment with a 
contractor or any employee of a contractor may, personally, or by an 
authorized representative, file a written complaint alleging a 
violation of the Act or the regulations in this part. The complaint may 
allege individual or class-wide violation(s). Such complaint must be 
filed within 300 days of the date of the alleged violation, unless the 
time for filing is extended by OFCCP for good cause shown. Complaints 
may be submitted to OFCCP, 200 Constitution Avenue NW., Washington, DC 
20210, or to any OFCCP regional, district, or area office. Complaints 
may also be submitted to the Veterans' Employment and Training Service 
of the Department of Labor directly, or through the Local Veterans' 
Employment Representative (LVER) at the local employment service 
office. Such parties will assist veterans in preparing complaints, 
promptly refer such complaints to OFCCP, and maintain a record of all 
complaints which they receive and forward. OFCCP shall inform the party 
forwarding the complaint of the progress and results of its complaint 
investigation. The state employment service delivery system shall 
cooperate with the Director in the investigation of any complaint.
    (b) Contents of complaints.--(1) In general. A complaint must be 
signed by the complainant or his or her authorized representative and 
must contain the following information:
    (i) Name and address (including telephone number) of the 
complainant;
    (ii) Name and address of the contractor who committed the alleged 
violation;
    (iii) Documentation showing that the individual is a protected 
veteran or pre-JVA veteran. Such documentation must include a copy of 
the veteran's form DD-214, and, where applicable, a copy of the 
veteran's Benefits Award Letter, or similar Department of Veterans 
Affairs certification, updated within one year prior to the date the 
complaint is filed;
    (iv) A description of the act or acts considered to be a violation, 
including the pertinent dates (in the case of an alleged continuing 
violation, the earliest and most recent date that the alleged violation 
occurred should be stated); and
    (v) Other pertinent information available which will assist in the 
investigation and resolution of the complaint, including the name of 
any known Federal agency with which the employer has contracted.
    (2) Third party complaints. A complaint filed by an authorized 
representative need not identify by name the person on whose behalf it 
is filed. The person filing the complaint, however, shall provide OFCCP 
with the name, address and telephone number of the person on whose 
behalf it is made, and the other information specified in paragraph 
(b)(1) of this section. OFCCP shall verify the authorization of such a 
complaint by the person on whose behalf the complaint is made. Any such 
person may request that OFCCP keep his or her identity confidential, 
and OFCCP will protect the individual's confidentiality wherever that 
is possible given the facts and circumstances in the complaint.
    (c) Incomplete information. Where a complaint contains incomplete 
information, OFCCP shall seek the needed information from the 
complainant. If the information is not furnished to OFCCP within 60 
days of the date of such request, the case may be closed.
    (d) Investigations. The Department of Labor shall institute a 
prompt investigation of each complaint.
    (e) Resolution of matters. (1) If the complaint investigation finds 
no violation of the Act or this part, or if the Director decides not to 
refer the matter to the Solicitor of Labor for enforcement proceedings 
against the contractor pursuant to Sec.  60-300.65(a)(1), the 
complainant and contractor shall be so notified. The Director, on his 
or her own initiative, may reconsider his or her determination or the 
determination of any of his or her designated officers who have 
authority to issue Notifications of Results of Investigation.
    (2) The Director will review all determinations of no violation 
that involve complaints that are not also cognizable under Title I of 
the Americans with Disabilities Act.
    (3) In cases where the Director decides to reconsider the 
determination of a Notification of Results of Investigation, the 
Director shall provide prompt notification of his or her intent to 
reconsider, which is effective upon issuance, and his or her final 
determination after reconsideration, to the person claiming to be 
aggrieved, the person making the complaint on behalf of such person, if 
any, and the contractor.
    (4) If the investigation finds a violation of the Act or this part, 
OFCCP shall invite the contractor to participate in conciliation 
discussions pursuant to Sec.  60-300.62.


Sec.  60-300.62  Conciliation agreements.

    If a compliance evaluation, complaint investigation or other review 
by OFCCP finds a material violation of the Act or this part, and if the 
contractor is willing to correct the violations and/or deficiencies, 
and if OFCCP determines that settlement on that basis (rather than 
referral for consideration of formal enforcement) is appropriate, a 
written conciliation agreement shall be required. The agreement shall 
provide for such remedial action as may be necessary to correct the 
violations and/or deficiencies noted, including, where appropriate (but 
not necessarily limited to) such make whole remedies as back pay and 
retroactive seniority. The agreement shall also specify the time period 
for completion of the remedial action; the period shall be no longer 
than the minimum period necessary to complete the action.


Sec.  60-300.63  Violation of conciliation agreements.

    (a) When OFCCP believes that a conciliation agreement has been 
violated, the following procedures are applicable:
    (1) A written notice shall be sent to the contractor setting forth 
the violation alleged and summarizing the supporting evidence. The 
contractor shall have 15 days from receipt of the notice to respond, 
except in those cases in which OFCCP asserts that such a delay would 
result in irreparable injury to the employment rights of affected 
employees or applicants.
    (2) During the 15-day period the contractor may demonstrate in 
writing that it has not violated its commitments.
    (b) In those cases in which OFCCP asserts that a delay would result 
in irreparable injury to the employment rights of affected employees or 
applicants, enforcement proceedings may be initiated immediately 
without proceeding through any other requirement contained in this 
chapter.
    (c) In any proceedings involving an alleged violation of a 
conciliation agreement OFCCP may seek enforcement of the agreement 
itself and shall not be required to present proof of the underlying 
violations resolved by the agreement.


Sec.  60-300.64  Show cause notices.

    When the Director has reasonable cause to believe that the 
contractor has violated the Act or this part, he or she may issue a 
notice requiring the contractor to show cause, within 30 days, why 
monitoring, enforcement proceedings or other appropriate action to 
ensure compliance should not be instituted. The issuance of such a 
notice

[[Page 58675]]

is not a prerequisite to instituting enforcement proceedings (see Sec.  
60-300.65).


Sec.  60-300.65  Enforcement proceedings.

    (a) General. (1) If a compliance evaluation, complaint 
investigation or other review by OFCCP finds a violation of the Act or 
this part, and the violation has not been corrected in accordance with 
the conciliation procedures in this part, or OFCCP determines that 
referral for consideration of formal enforcement (rather than 
settlement) is appropriate, OFCCP may refer the matter to the Solicitor 
of Labor with a recommendation for the institution of enforcement 
proceedings to enjoin the violations, to seek appropriate relief, and 
to impose appropriate sanctions, or any of the above in this sentence. 
OFCCP may seek back pay and other make whole relief for aggrieved 
individuals identified during a complaint investigation or compliance 
evaluation. Such individuals need not have filed a complaint as a 
prerequisite to OFCCP seeking such relief on their behalf. Interest on 
back pay shall be calculated from the date of the loss and compounded 
quarterly at the percentage rate established by the Internal Revenue 
Service for the underpayment of taxes.
    (2) In addition to the administrative proceedings set forth in this 
section, the Director may, within the limitations of applicable law, 
seek appropriate judicial action to enforce the contractual provisions 
set forth in Sec.  60-300.5, including appropriate injunctive relief. 
(b) Hearing practice and procedure. (1) In administrative enforcement 
proceedings the contractor shall be provided an opportunity for a 
formal hearing. All hearings conducted under the Act and this part 
shall be governed by the Rules of Practice for Administrative 
Proceedings to Enforce Equal Opportunity Under Executive Order 11246 
contained in 41 CFR part 60-30 and the Rules of Evidence set out in the 
Rules of Practice and Procedure for Administrative Hearings Before the 
Office of Administrative Law Judges contained in 29 CFR part 18, 
subpart B: Provided, That a final administrative order shall be issued 
within one year from the date of the issuance of the recommended 
findings, conclusions and decision of the Administrative Law Judge, or 
the submission of exceptions and responses to exceptions to such 
decision (if any), whichever is later.
    (2) Complaints may be filed by the Solicitor, the Associate 
Solicitor for Civil Rights and Labor-Management, Regional Solicitors, 
and Associate Regional Solicitors.
    (3) For the purposes of hearings pursuant to this part, references 
in 41 CFR part 60-30 to ``Executive Order 11246'' shall mean the 
Vietnam Era Veterans' Readjustment Assistance Act of 1974, as amended; 
references to ``equal opportunity clause'' shall mean the equal 
opportunity clause published at Sec.  60-300.5; and references to 
``regulations'' shall mean the regulations contained in this part.


Sec.  60-300.66  Sanctions and penalties.

    (a) Withholding progress payments. With the prior approval of the 
Director, so much of the accrued payment due on the contract or any 
other contract between the Government contractor and the Federal 
Government may be withheld as necessary to correct any violations of 
the provisions of the Act or this part.
    (b) Termination. A contract may be canceled or terminated, in whole 
or in part, for failure to comply with the provisions of the Act or 
this part.
    (c) Debarment. A contractor may be debarred from receiving future 
contracts for failure to comply with the provisions of the Act or this 
part subject to reinstatement pursuant to Sec.  60-300.68. Debarment 
may be imposed for an indefinite period, or may be imposed for a fixed 
period of not less than six months but no more than three years.
    (d) Hearing opportunity. An opportunity for a formal hearing shall 
be afforded to a contractor before the imposition of any sanction or 
penalty.


Sec.  60-300.67  Notification of agencies.

    The Director shall ensure that the heads of all agencies are 
notified of any debarments taken against any contractor.


Sec.  60-300.68  Reinstatement of ineligible contractors.

    (a) Application for reinstatement. A contractor debarred from 
further contracts for an indefinite period under the Act may request 
reinstatement in a letter filed with the Director at any time after the 
effective date of the debarment; a contractor debarred for a fixed 
period may make such a request following the expiration of six months 
from the effective date of the debarment. In connection with the 
reinstatement proceedings, all debarred contractors shall be required 
to show that they have established and will carry out employment 
policies and practices in compliance with the Act and this part. 
Additionally, in determining whether reinstatement is appropriate for a 
contractor debarred for a fixed period, the Director also shall 
consider, among other factors, the severity of the violation which 
resulted in the debarment, the contractor's attitude towards 
compliance, the contractor's past compliance history, and whether the 
contractor's reinstatement would impede the effective enforcement of 
the Act or this part. Before reaching a decision, the Director may 
conduct a compliance evaluation of the contractor and may require the 
contractor to supply additional information regarding the request for 
reinstatement. The Director shall issue a written decision on the 
request.
    (b) Petition for review. Within 30 days of its receipt of a 
decision denying a request for reinstatement, the contractor may file a 
petition for review of the decision with the Secretary. The petition 
shall set forth the grounds for the contractor's objections to the 
Director's decision. The petition shall be served on the Director and 
the Associate Solicitor for Civil Rights and Labor-Management and shall 
include the decision as an appendix. The Director may file a response 
within 14 days to the petition. The Secretary shall issue the final 
agency decision denying or granting the request for reinstatement. 
Before reaching a final decision, the Secretary may issue such 
additional orders respecting procedure as he or she finds appropriate 
in the circumstances, including an order referring the matter to the 
Office of Administrative Law Judges for an evidentiary hearing where 
there is a material factual dispute that cannot be resolved on the 
record before the Secretary.


Sec.  60-300.69  Intimidation and interference.

    (a) The contractor shall not harass, intimidate, threaten, coerce, 
or discriminate against any individual because the individual has 
engaged in or may engage in any of the following activities:
    (1) Filing a complaint;
    (2) Assisting or participating in any manner in an investigation, 
compliance evaluation, hearing, or any other activity related to the 
administration of the Act or any other Federal, state or local law 
requiring equal opportunity for protected veterans;
    (3) Opposing any act or practice made unlawful by the Act or this 
part or any other Federal, state or local law requiring equal 
opportunity for protected veterans, or
    (4) Exercising any other right protected by the Act or this part.
    (b) The contractor shall ensure that all persons under its control 
do not engage in such harassment, intimidation, threats, coercion or 
discrimination. The sanctions and penalties contained in this part may 
be exercised by the

[[Page 58676]]

Director against any contractor who violates this obligation.


Sec.  60-300.70  Disputed matters related to compliance with the Act.

    The procedures set forth in the regulations in this part govern all 
disputes relative to the contractor's compliance with the Act and this 
part. Any disputes relating to issues other than compliance, including 
contract costs arising out of the contractor's efforts to comply, shall 
be determined by the disputes clause of the contract.

Subpart E--Ancillary Matters


Sec.  60-300.80  Recordkeeping.

    (a) General requirements. Except as set forth in paragraph (b) of 
this section, any personnel or employment record made or kept by the 
contractor shall be preserved by the contractor for a period of two 
years from the date of the making of the record or the personnel action 
involved, whichever occurs later. However, if the contractor has fewer 
than 150 employees or does not have a Government contract of at least 
$150,000, the minimum record retention period will be one year from the 
date of the making of the record or the personnel action involved, 
whichever occurs later, except as set forth in paragraph (b) of this 
section. Such records include, but are not necessarily limited to, 
records relating to requests for reasonable accommodation; the results 
of any physical examination; job advertisements and postings; 
applications and resumes; tests and test results; interview notes; and 
other records having to do with hiring, assignment, promotion, 
demotion, transfer, lay-off or termination, rates of pay or other terms 
of compensation, and selection for training or apprenticeship. In the 
case of involuntary termination of an employee, the personnel records 
of the individual terminated shall be kept for a period of two years 
from the date of the termination, except that contractors that have 
fewer than 150 employees or that do not have a Government contract of 
at least $150,000 shall keep such records for a period of one year from 
the date of the termination. Where the contractor has received notice 
that a complaint of discrimination has been filed, that a compliance 
evaluation has been initiated, or that an enforcement action has been 
commenced, the contractor shall preserve all personnel records relevant 
to the complaint, compliance evaluation or action until final 
disposition of the complaint, compliance evaluation or action. The term 
personnel records relevant to the complaint, compliance evaluation or 
action would include, for example, personnel or employment records 
relating to the aggrieved person and to all other employees holding 
positions similar to that held or sought by the aggrieved person, and 
application forms or test papers completed by an unsuccessful applicant 
and by all other candidates for the same position as that for which the 
aggrieved person applied and was rejected.
    (b) Records with three-year retention requirement. Records required 
by Sec. Sec.  60-300.44(f)(4), 60-300.44(k), and 60-300.45(c) shall be 
maintained by all contractors for a period of three years from the date 
of the making of the record.
    (c) Failure to preserve records. Failure to preserve complete and 
accurate records as required by this part constitutes noncompliance 
with the contractor's obligations under the Act and this part. Where 
the contractor has destroyed or failed to preserve records as required 
by this section, there may be a presumption that the information 
destroyed or not preserved would have been unfavorable to the 
contractor: Provided, That this presumption shall not apply where the 
contractor shows that the destruction or failure to preserve records 
results from circumstances that are outside of the contractor's 
control.
    (d) The requirements of this section shall apply only to records 
made or kept on or after the date that the Office of Management and 
Budget has cleared the requirements.


Sec.  60-300.81  Access to records.

    Each contractor shall permit access during normal business hours to 
its places of business for the purpose of conducting on-site compliance 
evaluations and complaint investigations and inspecting and copying 
such books, accounts, and records, including electronic records, and 
any other material OFCCP deems relevant to the matter under 
investigation and pertinent to compliance with the Act or this part. 
Contractors must also provide OFCCP access to these materials, 
including electronic records, off-site for purposes of conducting 
compliance evaluations and complaint investigations. Upon request, the 
contractor must provide OFCCP information about all format(s), 
including specific electronic formats, in which the contractor 
maintains its records and other information. The contractor must 
provide records and other information in any of the formats in which 
they are maintained, as selected by OFCCP. Information obtained in this 
manner shall be used only in connection with the administration of the 
Act and in furtherance of the purposes of the Act. OFCCP will treat 
records provided by the contractor to OFCCP under this section as 
confidential to the maximum extent the information is exempt from 
public disclosure under the Freedom of Information Act, 5 U.S.C. 552.


Sec.  60-300.82  Labor organizations and recruiting and training 
agencies.

    (a) Whenever performance in accordance with the equal opportunity 
clause or any matter contained in the regulations in this part may 
necessitate a revision of a collective bargaining agreement, the labor 
organizations which are parties to such agreement shall be given an 
adequate opportunity to present their views to OFCCP.
    (b) OFCCP shall use its best efforts, directly or through 
contractors, subcontractors, local officials, the Department of 
Veterans Affairs, vocational rehabilitation facilities, and all other 
available instrumentalities, to cause any labor organization, 
recruiting and training agency or other representative of workers who 
are employed by a contractor to cooperate with, and to assist in, the 
implementation of the purposes of the Act.


Sec.  60-300.83  Rulings and interpretations.

    Rulings under or interpretations of the Act and this part shall be 
made by the Director.


Sec.  60-300.84  Responsibilities of appropriate employment service 
delivery system.

    By statute, appropriate employment service delivery systems are 
required to refer qualified protected veterans to fill employment 
openings listed by contractors with such appropriate employment 
delivery systems pursuant to the mandatory job listing requirements of 
the equal opportunity clause and are required to give priority to 
protected veterans in making such referrals. The employment service 
delivery systems shall provide OFCCP, upon request, information 
pertinent to whether the contractor is in compliance with the mandatory 
job listing requirements of the equal opportunity clause.

Appendix A to Part 60-300--Guidelines on a Contractor's Duty To Provide 
Reasonable Accommodation

    The guidelines in this appendix are in large part derived from, 
and are consistent with, the discussion regarding the duty to 
provide reasonable accommodation contained in the Interpretive 
Guidance on

[[Page 58677]]

Title I of the Americans with Disabilities Act (ADA) set out as an 
appendix to the regulations issued by the Equal Employment 
Opportunity Commission (EEOC) implementing the ADA (29 CFR part 
1630). Although the following discussion is intended to provide an 
independent ``free-standing'' source of guidance with respect to the 
duty to provide reasonable accommodation under this part, to the 
extent that the EEOC appendix provides additional guidance which is 
consistent with the following discussion, it may be relied upon for 
purposes of this part as well. See Sec.  60-300.1(c). Contractors 
are obligated to provide reasonable accommodation and to take 
affirmative action. Reasonable accommodation under VEVRAA, like 
reasonable accommodation required under section 503 and the ADA, is 
a part of the nondiscrimination obligation. See EEOC appendix cited 
in this paragraph. Affirmative action is unique to VEVRAA and 
section 503, and includes actions above and beyond those required as 
a matter of nondiscrimination. An example of this is the requirement 
discussed in paragraph 2 of this appendix that a contractor shall 
make an inquiry of a disabled veteran who is having significant 
difficulty performing his or her job.
    1. A contractor is required to make reasonable accommodations to 
the known physical or mental limitations of an ``otherwise 
qualified'' disabled veteran, unless the contractor can demonstrate 
that the accommodation would impose an undue hardship on the 
operation of its business. As stated in Sec.  60-300.2(s), a 
disabled veteran is qualified if he or she has the ability to 
perform the essential functions of the position with or without 
reasonable accommodation. A contractor is required to make a 
reasonable accommodation with respect to its application process if 
the disabled veteran is qualified with respect to that process. One 
is ``otherwise qualified'' if he or she is qualified for a job, 
except that, because of a disability, he or she needs a reasonable 
accommodation to be able to perform the job's essential functions.
    2. Although the contractor would not be expected to accommodate 
disabilities of which it is unaware, the contractor has an 
affirmative obligation to provide a reasonable accommodation for 
applicants and employees who are known to be disabled veterans. As 
stated in Sec.  60-300.42(b) (see also Appendix B of this part), the 
contractor is required to invite applicants who have been provided 
an offer of employment, before they are placed on the contractor's 
payroll, to indicate whether they are a disabled veteran who may be 
protected by the Act. Section 60-300.42(d) further provides that the 
contractor must seek the advice of disabled veterans who ``self-
identify'' in this way as to reasonable accommodation. Moreover, 
Sec.  60-300.44(d) provides that if an employee who is a known 
disabled veteran is having significant difficulty performing his or 
her job and it is reasonable to conclude that the performance 
problem may be related to the disability, the contractor is required 
to confidentially inquire whether the problem is disability related 
and if the employee is in need of a reasonable accommodation.
    3. An accommodation is any change in the work environment or in 
the way things are customarily done that enables a disabled veteran 
to enjoy equal employment opportunities. Equal employment 
opportunity means an opportunity to attain the same level of 
performance, or to enjoy the same level of benefits and privileges 
of employment, as are available to the average similarly situated 
employee without a disability. Thus, for example, an accommodation 
made to assist an employee who is a disabled veteran in the 
performance of his or her job must be adequate to enable the 
individual to perform the essential functions of the position. The 
accommodation, however, does not have to be the ``best'' 
accommodation possible, so long as it is sufficient to meet the job-
related needs of the individual being accommodated. There are three 
areas in which reasonable accommodations may be necessary: (1) 
accommodations in the application process; (2) accommodations that 
enable employees who are disabled veterans to perform the essential 
functions of the position held or desired; and (3) accommodations 
that enable employees who are disabled veterans to enjoy equal 
benefits and privileges of employment as are enjoyed by employees 
without disabilities.
    4. The term ``undue hardship'' refers to any accommodation that 
would be unduly costly, extensive, substantial, or disruptive, or 
that would fundamentally alter the nature or operation of the 
contractor's business. The contractor's claim that the cost of a 
particular accommodation will impose an undue hardship requires a 
determination of which financial resources should be considered--
those of the contractor in its entirety or only those of the 
facility that will be required to provide the accommodation. This 
inquiry requires an analysis of the financial relationship between 
the contractor and the facility in order to determine what resources 
will be available to the facility in providing the accommodation. If 
the contractor can show that the cost of the accommodation would 
impose an undue hardship, it would still be required to provide the 
accommodation if the funding is available from another source, e.g., 
the Department of Veterans Affairs or a state vocational 
rehabilitation agency, or if Federal, state or local tax deductions 
or tax credits are available to offset the cost of the 
accommodation. In the absence of such funding, the disabled veteran 
must be given the option of providing the accommodation or of paying 
that portion of the cost which constitutes the undue hardship on the 
operation of the business.
    5. The definition for ``reasonable accommodation'' in Sec.  60-
300.2(t) lists a number of examples of the most common types of 
accommodations that the contractor may be required to provide. There 
are any number of specific accommodations that may be appropriate 
for particular situations. The discussion in this appendix is not 
intended to provide an exhaustive list of required accommodations 
(as no such list would be feasible); rather, it is intended to 
provide general guidance regarding the nature of the obligation. The 
decision as to whether a reasonable accommodation is appropriate 
must be made on a case-by-case basis. The contractor must consult 
with the disabled veteran in deciding on the reasonable 
accommodation; frequently, the individual will know exactly what 
accommodation he or she will need to perform successfully in a 
particular job, and may suggest an accommodation which is simpler 
and less expensive than the accommodation the contractor might have 
devised. Other resources to consult include the appropriate state 
vocational rehabilitation services agency, the Equal Employment 
Opportunity Commission (1-800-669-4000 (voice), 1-800-669-6820 
(TTY)), the Job Accommodation Network (JAN) operated by the Office 
of Disability Employment Policy in the U.S. Department of Labor (1-
800-526-7234 or 1-800-232-9675), private disability organizations 
(including those that serve veterans), and other employers.
    6. With respect to accommodations that can permit an employee 
who is a disabled veteran to perform essential functions 
successfully, a reasonable accommodation may require the contractor 
to, for instance, modify or acquire equipment. For the visually-
impaired, such accommodations may include providing adaptive 
hardware and software for computers, electronic visual aids, Braille 
devices, talking calculators, magnifiers, audio recordings and 
Braille or large-print materials. For persons with hearing 
impairments, reasonable accommodations may include providing 
telephone handset amplifiers, telephones compatible with hearing 
aids and text telephones (TTYs). For persons with limited physical 
dexterity, the obligation may require the provision of telephone 
headsets, speech activated software and raised or lowered furniture.
    7. Other reasonable accommodations of this type may include 
providing personal assistants such as a reader, sign language 
interpreter or travel attendant, permitting the use of accrued paid 
leave or providing additional unpaid leave for necessary treatment. 
The contractor may also be required to make existing facilities 
readily accessible to and usable by disabled veterans--including 
areas used by employees for purposes other than the performance of 
essential job functions such as restrooms, break rooms, cafeterias, 
lounges, auditoriums, libraries, parking lots and credit unions. 
This type of accommodation will enable employees to enjoy equal 
benefits and privileges of employment as are enjoyed by employees 
who do not have disabilities.
    8. Another of the potential accommodations listed in Sec.  60-
300.2(t) is job restructuring. This may involve reallocating or 
redistributing those nonessential, marginal job functions which a 
qualified disabled veteran cannot perform to another position. 
Accordingly, if a clerical employee who is a disabled veteran is 
occasionally required to lift heavy boxes containing files, but 
cannot do so because of a disability, this task may be reassigned to 
another employee. The contractor, however, is not required to 
reallocate essential functions, i.e., those functions that the 
individual who holds the job would have to perform, with or without

[[Page 58678]]

reasonable accommodation, in order to be considered qualified for 
the position. For instance, the contractor which has a security 
guard position which requires the incumbent to inspect identity 
cards would not have to provide a blind disabled veteran with an 
assistant to perform that duty; in such a case, the assistant would 
be performing an essential function of the job for the disabled 
veteran. Job restructuring may also involve allowing part-time or 
modified work schedules. For instance, flexible or adjusted work 
schedules could benefit disabled veterans who cannot work a standard 
schedule because of the need to obtain medical treatment, or 
disabled veterans with mobility impairments who depend on a public 
transportation system that is not accessible during the hours of a 
standard schedule.
    9. Reasonable accommodation may also include reassignment to a 
vacant position. In general, reassignment should be considered only 
when accommodation within the disabled veteran's current position 
would pose an undue hardship. Reassignment is not required for 
applicants. However, in making hiring decisions, contractors are 
encouraged to consider applicants who are known disabled veterans 
for all available positions for which they may be qualified when the 
position(s) applied for is unavailable. Reassignment may not be used 
to limit, segregate, or otherwise discriminate against employees who 
are disabled veterans by forcing reassignments to undesirable 
positions or to designated offices or facilities. Employers should 
reassign the individual to an equivalent position in terms of pay, 
status, etc., if the individual is qualified, and if the position is 
vacant within a reasonable amount of time. A ``reasonable amount of 
time'' must be determined in light of the totality of the 
circumstances.
    10. The contractor may reassign an individual to a lower graded 
position if there are no accommodations that would enable the 
employee to remain in the current position and there are no vacant 
equivalent positions for which the individual is qualified with or 
without reasonable accommodation. The contractor may maintain the 
reassigned disabled veteran at the salary of the higher graded 
position, and must do so if it maintains the salary of reassigned 
employees who are not disabled veterans. It should also be noted 
that the contractor is not required to promote a disabled veteran as 
an accommodation.
    11. With respect to the application process, reasonable 
accommodations may include the following: (1) providing information 
regarding job vacancies in a form accessible to disabled veterans 
who are vision or hearing impaired, e.g., by making an announcement 
available in braille, in large print, or on computer disc, or by 
responding to job inquiries via TTYs; (2) providing readers, sign 
language interpreters and other similar assistance during the 
application, testing and interview process; (3) appropriately 
adjusting or modifying employment-related examinations, e.g., 
extending regular time deadlines, allowing a disabled veteran who is 
blind or has a learning disorder such as dyslexia to provide oral 
answers for a written test, and permitting an applicant, regardless 
of the nature of his or her ability, to demonstrate skills through 
alternative techniques and utilization of adapted tools, aids and 
devices; and (4) ensuring a disabled veteran with a mobility 
impairment full access to testing locations such that the 
applicant's test scores accurately reflect the applicant's skills or 
aptitude rather than the applicant's mobility impairment.

Appendix B to Part 60-300--Sample Invitation to Self-Identify

[Sample Invitation to Self-Identify]

    1. This employer is a Government contractor subject to the 
Vietnam Era Veterans' Readjustment Assistance Act of 1974, as 
amended by the Jobs for Veterans Act of 2002, 38 U.S.C. 4212 
(VEVRAA), which requires Government contractors to take affirmative 
action to employ and advance in employment: (1) disabled veterans; 
(2) recently separated veterans; (3) active duty wartime or campaign 
badge veterans; and (4) Armed Forces service medal veterans. These 
classifications are defined as follows:
     A ``disabled veteran'' is one of the following:
     a veteran of the U.S. military, ground, naval or air 
service who is entitled to compensation (or who but for the receipt 
of military retired pay would be entitled to compensation) under 
laws administered by the Secretary of Veterans Affairs; or
     a person who was discharged or released from active 
duty because of a service-connected disability.
     A ``recently separated veteran'' means any veteran 
during the three-year period beginning on the date of such veteran's 
discharge or release from active duty in the U.S. military, ground, 
naval, or air service.
     An ``active duty wartime or campaign badge veteran'' 
means a veteran who served on active duty in the U.S. military, 
ground, naval or air service during a war, or in a campaign or 
expedition for which a campaign badge has been authorized under the 
laws administered by the Department of Defense.
     An ``Armed forces service medal veteran'' means a 
veteran who, while serving on active duty in the U.S. military, 
ground, naval or air service, participated in a United States 
military operation for which an Armed Forces service medal was 
awarded pursuant to Executive Order 12985.
    Protected veterans may have additional rights under USERRA--the 
Uniformed Services Employment and Reemployment Rights Act. In 
particular, if you were absent from employment in order to perform 
service in the uniformed service, you may be entitled to be 
reemployed by your employer in the position you would have obtained 
with reasonable certainty if not for the absence due to service. For 
more information, call the U.S. Department of Labor's Veterans 
Employment and Training Service (VETS), toll-free, at 1-866-4-USA-
DOL.
    2. [THE FOLLOWING TEXT SHOULD BE USED WHEN EXTENDING THE ``PRE-
OFFER'' INVITATION AS REQUIRED BY 41 CFR 60-300.42(a). THE 
DEFINITIONS OF THE SEPARATE CLASSIFICATIONS OF PROTECTED VETERANS 
SET FORTH IN PARAGRAPH 1 MUST ACCOMPANY THIS SELF-IDENTIFICATION 
REQUEST.] If you believe you belong to any of the categories of 
protected veterans listed above, please indicate by checking the 
appropriate box below. As a Government contractor subject to VEVRAA, 
we request this information in order to measure the effectiveness of 
the outreach and positive recruitment efforts we undertake pursuant 
to VEVRAA.

[ ] I IDENTIFY AS ONE OR MORE OF THE CLASSIFICATIONS OF PROTECTED 
VETERAN LISTED ABOVE
[ ] I AM NOT A PROTECTED VETERAN

    [THE FOLLOWING TEXT SHOULD BE USED IF REQUIRED TO EXTEND THE 
``POST-OFFER'' INVITATION DESCRIBED IN 41 CFR 60-300.42(b). THE 
DEFINITIONS OF THE SEPARATE CLASSIFICATIONS OF PROTECTED VETERAN 
INCLUDED IN THE POST-OFFER INVITATION MUST ACCOMPANY THIS SELF-
IDENTIFICATION REQUEST.]
    As a Government contractor subject to VEVRAA, we are required to 
submit a report to the United States Department of Labor each year 
identifying the number of our employees belonging to each specified 
``protected veteran'' category. If you believe you belong to any of 
the categories of protected veterans listed above, please indicate 
by checking the appropriate box below.
    I BELONG TO THE FOLLOWING CLASSIFICATIONS OF PROTECTED VETERANS 
(CHOOSE ALL THAT APPLY):

    [ ] DISABLED VETERAN
    [ ] RECENTLY SEPARATED VETERAN
    [ ] ACTIVE WARTIME OR CAMPAIGN BADGE VETERAN
    [ ] ARMED FORCES SERVICE MEDAL VETERAN

    --------------------

    [ ] I am a protected veteran, but I choose not to self-identify 
the classifications to which I belong.
    [ ] I am NOT a protected veteran.

    If you are a disabled veteran it would assist us if you tell us 
whether there are accommodations we could make that would enable you 
to perform the essential functions of the job, including special 
equipment, changes in the physical layout of the job, changes in the 
way the job is customarily performed, provision of personal 
assistance services or other accommodations. This information will 
assist us in making reasonable accommodations for your disability.
    3. Submission of this information is voluntary and refusal to 
provide it will not subject you to any adverse treatment. The 
information provided will be used only in ways that are not 
inconsistent with the Vietnam Era Veterans' Readjustment Assistance 
Act of 1974, as amended.
    4. The information you submit will be kept confidential, except 
that (i) supervisors and managers may be informed regarding 
restrictions on the work or duties of disabled veterans, and 
regarding necessary accommodations; (ii) first aid and safety 
personnel may be informed, when and to the

[[Page 58679]]

extent appropriate, if you have a condition that might require 
emergency treatment; and (iii) Government officials engaged in 
enforcing laws administered by the Office of Federal Contract 
Compliance Programs, or enforcing the Americans with Disabilities 
Act, may be informed.
    5. [The contractor should here insert a brief provision 
summarizing the relevant portion of its affirmative action program.]

Appendix C to Part 60-300--Review of Personnel Processes

    The following is a set of procedures which contractors may use 
to meet the requirements of Sec.  60-300.44(b):
    1. The application or personnel form of each known applicant who 
is a protected veteran should be annotated to identify each vacancy 
for which the applicant was considered, and the form should be 
quickly retrievable for review by the Department of Labor and the 
contractor's personnel officials for use in investigations and 
internal compliance activities.
    2. The personnel or application records of each known protected 
veteran should include (i) the identification of each promotion for 
which the protected veteran was considered, and (ii) the 
identification of each training program for which the protected 
veteran was considered.
    3. In each case where an employee or applicant who is a 
protected veteran is rejected for employment, promotion, or 
training, the contractor should prepare a statement of the reason as 
well as a description of the accommodations considered (for a 
rejected disabled veteran). The statement of the reason for 
rejection (if the reason is medically related), and the description 
of the accommodations considered, should be treated as confidential 
medical records in accordance with Sec.  60-300.23(d). These 
materials should be available to the applicant or employee concerned 
upon request.
    4. Where applicants or employees are selected for hire, 
promotion, or training and the contractor undertakes any 
accommodation which makes it possible for him or her to place a 
disabled veteran on the job, the contractor should make a record 
containing a description of the accommodation. The record should be 
treated as a confidential medical record in accordance with Sec.  
60-300.23(d).
[FR Doc. 2013-21227 Filed 9-23-13; 8:45 am]
BILLING CODE 4510-45-P