The Office of Federal Contract Compliance Programs (OFCCP) at the United States Department of Labor recently issued three rules rescinding or revising affirmative action obligations for federal contractors and subcontractors that have been in place for over 60 years.
Limiting Obligations Under Section 503
The OFCCP made significant revisions to the regulations governing the implementation of Section 503 of the Rehabilitation Act of 1973. Under the OFCCP’s Section 503 final rule published on August 21, 2026, federal contractors will no longer be required to invite applicants and employees to self-identify as individuals living with disabilities, collect disability-related data, or compare their workforce to the OFCCP’s seven percent utilization goal.
While these changes reduce a contractor’s overall compliance obligations under Section 503, the rule retains Section 503’s core disability nondiscrimination protections, reasonable accommodation requirements, outreach assessment obligations, and Affirmative Action Program (AAP) requirements. Covered federal contractors are still required to take affirmative action to employ and advance qualified individuals with disabilities, maintain related affirmative action programs, conduct and evaluate recruitment efforts, provide reasonable accommodations, and comply with other Section 503 requirements.
Rescission of Implementing Regulations
Executive Order 14173, issued by President Trump on January 21, 2025, revoked Executive Order 11246 (EO 11246), which was signed by President Lyndon B. Johnson on September 24, 1965. EO 11246 prohibited federal contractors and subcontractors from discrimination based on race, color, religion, sex, or national origin. Since the revocation of EO 11246, federal contractors have not had any federal race- or sex-based affirmative action obligations.
On August 21, 2026, the OFCCP published a final rule — entitled “Rescission of Executive Order 11246 Implementing Regulations” — which rescinds the implementing regulations associated with the now-revoked EO 11246. Parts of Title 41 of the Code of Federal Regulations (CFR), chapter 60, which were developed under EO 11246, have now been rescinded.
Modifying VEVRAA
The OFCCP also has made some minor changes to the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as amended. All cross-references to EO 11246 have been removed, the procedures for administrative enforcement proceedings have been relocated from the former Part 60-30 to the VEVRAA regulations at 41 CFR Part 60-300, and updates to the jurisdictional coverage threshold were made — from $150,000 to $200,000 — in accordance with the inflationary adjustments established by the Federal Acquisition Regulations (FAR) System.
What this Means
These actions by the OFCCP are just one aspect of the Trump administration’s push to eliminate or greatly reduce the scope of federal contractors’ affirmative action obligations. These changes create risk for contractors who wish to continue certain practices — such as the invitation to self-identify as a person living with disabilities — that they may view as beneficial from a business or recruitment perspective.
Contractors are encouraged to consult with employment counsel regarding their current affirmative action programs and practices to ensure they meet ongoing affirmative action obligations while also considering discontinuing previously required practices that may now create risk. At a minimum, federal contractors and subcontractors should remove the mandatory Form CC-305 self-identification process and the 7 percent utilization analysis from their disability compliance system.
It’s also important to remember that these rules do not eliminate prohibitions on employment discrimination under Title VII of the Civil Rights Act of 1964, or elsewhere under federal, state, and local laws.
In New Hampshire, where Orr & Reno is located, state law (RSA 354-A) prohibits discrimination in employment based on race, color, religion, national origin, sex, sexual orientation, gender identity, marital status, physical or mental disability, or familial status. RSA 354-A covers both private and public sector employers with at least six employees. Most states have similar antidiscrimination statutes.
If you have any questions about your current Section 503 requirements — or any other nondiscrimination, accessibility, outreach, and accommodation practices — don’t hesitate to contact Orr & Reno for assistance.
