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Section 503 of the Rehabilitation Act of 1973, as amended, requires employers with federal contracts or subcontracts that exceed $10,000, and contracts or subcontracts for indefinite quantities (unless the purchaser has reason to believe that the cost in any one year will not exceed $10,000), to take affirmative steps to hire, retain, and promote qualified individuals with disabilities. The regulations implementing Section 503 make clear that this obligation to take affirmative steps includes the duty to refrain from discrimination in employment against qualified individuals with disabilities.
The following types of contracts and subcontracts are
exempt from Section 503:
The Deputy Assistant Secretary may grant a waiver from the requirements of Section 503 in the following circumstances:
On September 24, 2013, the U.S. Department of Labor’s Office of Federal Contract Compliance Programs published a Final Rule in the
Federal Register that makes changes to the regulations implementing Section 503 of the Rehabilitation Act of 1973, as amended (Section 503) at 41 CFR Part 60-741. Section 503 prohibits federal contractors and subcontractors from discriminating in employment against individuals with disabilities (IWDs), and requires these employers to take affirmative action to recruit, hire, promote, and retain these individuals. The new rule strengthens the affirmative action provisions of the regulations to aid contractors in their efforts to recruit and hire IWDs, and improve job opportunities for individuals with disabilities. The new rule also makes changes to the nondiscrimination provisions of the regulations to bring them into compliance with the ADA Amendments Act of 2008.
The new Section 503 regulations became effective on March 24, 2014. However, contractors with a written affirmative action program (AAP) already in place on the effective date have additional time to come into compliance with the AAP requirements. This compliance structure seeks to provide contractors the opportunity to maintain their current AAP cycle.
Highlights of the New Regulations:
Under Section 503 and its implementing regulations, covered employers with federal contracts or subcontracts must take affirmative steps to employ qualified individuals with disabilities. This obligation covers the full range of employment and personnel practices, such as recruitment, hiring, rates of pay, upgrading, and selection for training. All covered contractors and subcontractors must also include a specific equal opportunity clause in each of their nonexempt contacts and subcontracts. The regulations provide the required language for this clause.
In addition, Section 503 and its regulations require covered federal contractors and subcontractors to make reasonable accommodations for the known physical or mental limitations of qualified individuals with disabilities, unless providing an accommodation would create an undue hardship. Furthermore, covered contractors and subcontractors are required to take all necessary actions to ensure that no one attempts to intimidate or discriminate against any individual for filing a complaint or participating in a proceeding under Section 503.
Under Section 503, each employer that has both (1) a federal contract or subcontract of $50,000 or more, and (2) 50 or more employees, must prepare, implement, and maintain a written affirmative action program covering each of its establishments. The employer must review and update the program annually and must make it available for inspection by any employee or applicant for employment, as well as by the Office of Federal Contract Compliance Programs (OFCCP) within the Department of Labor’s Employment Standards Administration. The program may be integrated with, or kept separate from, any other affirmative action program the employer is required to prepare.
Employees of and applicants for employment with a covered contractor or subcontractor have the right to file a complaint with OFCCP if they believe that a federal contractor or subcontractor has discriminated against them on the basis of a disability. Anyone may call OFCCP with a question about interpreting the regulations, filing a complaint, or any other related matter. The main telephone numbers for OFCCP's national offices are 202-693-0101 and 202-693-1308 (TTY). Additional telephone numbers are located on OFCCP’s Office Contact Web page.
OFCCP investigates for violations of Section 503 either through compliance evaluations or in response to complaints. If a violation is found, OFCCP may ask the federal contractor or subcontractor to enter into conciliation negotiations. If conciliation efforts fail, OFCCP may initiate an administrative enforcement proceeding by issuing an administrative complaint against the contractor or subcontractor.
If OFCCP files an administrative complaint, the contractor or subcontractor has 20 days to request a review by an Administrative Law Judge (ALJ), who hears the case and recommends a decision. If the contractor or subcontractor is dissatisfied with the ALJ's decision, it may appeal the decision to the Department of Labor's Administrative Review Board. The Board issues the final decision, whether or not there is an appeal.
If the Board finds that a violation of Section 503 has occurred, it may order the contractor or subcontractor to provide appropriate relief, which may include back pay and benefits, and restoration of employment status, for the victim(s) of discrimination. Depending on the circumstances, violations also may result in cancellation, suspension, or termination of contracts, withholding of progress payments, and debarment.
If the contractor or subcontractor is dissatisfied with the Board's decision, it may appeal that decision to the federal courts.
Relation to State, Local, and Other Federal Laws
Section 503 and its implementing regulations apply only to the specific state or local government entities that participate in work on or under a federal contract or subcontract. This coverage is narrower than that which applies to employers in the private sector.
Section 107(b) of the Americans With Disabilities Act of 1990 (ADA) required agencies with enforcement responsibilities under the Rehabilitation Act of 1973 (e.g., OFCCP) and under Title I of the ADA (i.e., the Equal Employment Opportunity Commission) to develop procedural regulations to ensure that complaints filed under these laws are addressed in a manner that avoids duplication of effort and prevents application of inconsistent or conflicting standards for the same requirements under the two laws. These regulations are found at 41 CFR Part 60-742.
[Editor's Note: On August 27, the Office of Federal Contract Compliance Programs (OFCCP) announced new rules outlining how federal contractors should handle their affirmative action and nondiscrimination obligations for protected veterans and for individuals with disabilities. These rules, in large part, mirror each other and fundamentally alter the rules for compliance with Section 503 of the Rehabilitation Act of 1973 covering persons with disabilities.
Although some aspects of the rules were made less onerous, the final versions of both rules include significant requirements for employers. Under each rule, the OFCCP requires employers to achieve specific numeric goals to document compliance. For example, the final disabilities rule still requires that 7 percent of all persons in each of the organization’s job groups be individuals with disabilities. It also requires that contractors compare the number of individuals with disabilities (IWD) who apply to the number of IWD that are hired, and keep those records for three years for audit purposes.]
here to download full text of the statutes.
Source: US Department of Labor
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