On August 27, 2013, 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 under the Vietnam Era Veterans’ Readjustment Assistance Act ("VEVRAA"), governing protected veterans, and Section 503 of the Rehabilitation Act ("Section 503"), governing persons with disabilities. The new rules attempt to measure federal contractors’ progress toward achieving equal opportunity for people with disabilities and protected veterans and fundamentally alter the rules for compliance.

The rules will soon be published in the Federal Register and will take effect 180 days later. Although some aspects of the rules were made less onerous, the final versions of both rules include significant requirements for employers. The VEVRAA rule requires contractors to establish an annual hiring benchmark, either based on the national percentage of veterans in the workforce (currently 8%), or based on the best available data and factors unique to their establishments. The Section 503 rule establishes an aspirational 7% utilization goal for the employment of individuals with disabilities. The rules also require that contractors compare the number of individuals with disabilities who apply to the number of individuals with disabilities that are hired, and keep those records for three years for audit purposes.