There have been changes to the requirement for federal contractors to have affirmative action plans (AAPs) since the Trump administration came into office.
In Executive Order (EO) 14173 “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” issued on January 21, 2025, the administration rescinded EO 11246 and required the Office of Federal Contract Compliance Programs (OFCCP) to “immediately cease” promoting diversity, holding federal contractors responsible for fulfilling the “affirmative action” obligations imposed by EO 11246, and allowing or encouraging federal contractors to engage in “workforce balancing” based on race, color, sex, sexual preference, religion, or national origin.
The secretary of the Department of Labor (DOL) then issued a statement on January 24 reiterating the main points of the new EO, stating the OFCCP no longer has the authority to act under the rescinded order but that it will maintain its authority under Section 503 of the Rehabilitation Act (503) and the Vietnam Era Veterans’ Readjustment Act (VEVRAA), which apply to individuals with disabilities and veterans, respectively. So, what does this mean for employers?
Safe Harbor Period is Over
For 90 days, a safe harbor period was in effect whereby federal contractors were allowed to continue to comply with obligations stemming from the now-revoked EO 11246. Since the safe harbor’s expiration, the OFCCP hasn’t indicated it intends to move forward with any requirements for federal contractors to have AAPs and stated it wouldn’t be enforcing said plans.
The plan mandate under 503/VEVRAA remains in effect, and on July 1, the secretary of labor issued EO 08-2025, allowing the OFCCP to resume activities under 503/VEVRAA. This EO also states it’s closing all compliance reviews related to plans under 503/VEVRAA because of their entanglement with the rescinded EO. Because the OFCCP is trying to separate the requirements of 503/VEVRAA from the rescinded order, it’s keeping the certification period for employers to confirm 503/VEVRAA plan compliance closed.
What Happens Next?
At this point, it’s clear the DOL is making efforts to discontinue the AAP requirements for federal contractors. This also appears to include 503, as the DOL has proposed rules that would remove the requirements for federal contractors to invite voluntary disability self-identification and cease the use of utilization goals for individuals with disabilities under 503.
This doesn’t mean the other aspects of federal and state antidiscrimination and reporting laws are no longer in play. But at this time, the federal government isn’t requiring employers to create plans specifically addressing employee data and potential disparities among certain employee populations.
On June 27, the head of the OFCCP issued a letter inviting federal contractors to voluntarily file a narrative report outlining the efforts they were taking to “wind down” prior plans. In light of this, federal contractors should review plans currently in place under the rescinded order, 503, and/or VEVRAA to determine if they should cease and/or revise those plans. While these efforts are being made, you can consider whether to file an optional statement with the OFCCP regarding those efforts, but that decision should be made with the advice of counsel.
Additionally, for those wondering whether they should enact and/or update plans in the near future, we strongly recommend seeking legal advice before data collection and planning, especially with data related to race or gender, to ensure compliance with the evolving regulations and orders.
Although certification and enforcement aren’t currently being managed by the OFCCP, the obligations under 503/VEVRAA remain, and employers should consider preparing a plan to comply with those regulations only. This would be limited data reporting for those who self-identify as disabled and/or veterans only.
Maureen James is an attorney at Skoler, Abbott & Presser, P.C., in Massachusetts. She can be reached at mjames@skoler-abbott.com and 413-737-4753.