VETS Proposes New Regulations to Comply with OFCCP Regulations and Decrease Work for Employers

On Monday, the Federal Register contained a Notice of Proposed Rule Making published by the Veterans' Employment and Training Service (VETS) “to propose revisions to the regulations implementing the reporting requirements under the Vietnam Era Veterans' Readjustment Assistance Act of 1974, as amended, (“VEVRAA”).”  Essentially, the proposed rule intends to simplify the reporting requirements of federal contractors to be consistent with the new affirmative action regulations published by the OFCCP (and which take effect next month).  Among other things, the proposed new rule officially eliminates the VETS-100 form, rescinds the regulations at 41 C.F.R. 61-250, and renames the VETS-100A form the Vets-4212 form.   The VETS 4212 form would also begin using the terms as defined in the new OFCCP regulations (which are discussed in more detail below).  In addition, the new regulations would cease requiring employers to collect hiring information on each sub-category of protected veteran because, among other things, some veterans qualify in more than one category.   Thus, the new regulation would eliminate double counting and eliminate the possible, inadvertent identification of disabled veterans, etc.  By the time the regulations become effective in 2015, employers would only need to collect information for the re-defined “protected veteran,” instead of in each sub-category.

A number of definitions for the various sub-groups of statutorily protected or covered veterans have changed over the years to include more than merely Vietnam  veterans.  They are changing again.  First, “other protected veteran” is being changed to “active duty wartime or campaign badge veteran.”  In 1998, the Veterans Employment Opportunity Act of 1998 (VEOA) amended VEVRAA by extending protection to the category of veterans “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.” Initially, both the VETS and OFCCP regulations implementing the VEOA amendments adopted the term “other protected veteran” to refer to the veterans belonging to this category.  However, OFCCP's most recent regulations replace the term “other protected veteran” with “active duty wartime or campaign badge veteran” because the term “other protected veteran” was understandably being misinterpreted as a “catch-all” that includes all veterans rather than shorthand for the category of veterans who served on active duty during a war or in a campaign for which a campaign badge has been authorized. VETS proposed new rule is making a similar change.

Second, “covered veteran” is being changed to “protected veteran.”  Currently, “covered veteran” means  “a veteran in any of the four categories defined in the section—disabled veteran, other protected veteran, Armed Forces service medal veteran, and recently separated veteran.”  However, the new OFCCP regulations decided to use essentially that definition to apply to “protected veteran” and VETS wants to be consistent.   To be clear, “protected veteran” will now mean “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.”  By the time the new VETS-2414 form becomes effective in 2015, employers will only need to collect hiring information on the newly defined “protected veteran.”

In the meantime, however, employers still have the VETS-100A form to use and OFCCP’s new regulation, which takes effect on March 24, 2014.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

OFCCP Publishes New Affirmative Action Regulations Covering Protected Veterans

As most readers know, the Office of Federal Contract Compliance Programs (OFCCP) yesterday published in the Federal Registrar 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 and requires each covered Federal contractor and subcontractor to take affirmative action regarding these veterans. “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.“ These regulations become effective on March 24, 2014 and apply to affirmative action plans with plan years that begin after that date.  I summarized the Rehabilitation Act regulations yesterday.  Today, I’ll focus on the affirmative action requirements for protected veterans.  As with the Rehabilitation Act regulations, the new VEVRAA regulations suggest a new national hiring “benchmark” – 8% -- for employing protected veterans in each job group, although contractors are given some leeway to establish their own benchmarks (unlike with the Rehabilitation Act regulations).  Contractors will now be required to conduct annual analyses, etc. concerning their hiring and utilization of veterans.  Accordingly, affirmative action employers will need to substantially revise their affirmative action plans for disabled and veterans in order to comply with the new rules.

The existing VEVRAA regulations 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. The threshold amount for coverage is a single contract of $25,000. Yesterday’s revisions to the VEVRAA regulations rescind the regulations at part 60–250, except that it retains protection for veterans who were covered by that regulation.    Part 60–300 applies to any Government contract or subcontract of $100,000 or more entered into on or after December 1, 2003. The amount for VEVRAA and AAP threshold coverage is a single contract of $100,000 or more.  Federal contractors and subcontractors which meet that coverage threshold and have 50 or more employees must develop a written AAP.

Hiring and Utilization Benchmarks.  One of the most significant changes is that contractors will now be required to annually establish a hiring “benchmark.”  A benchmark is a lesser standard than the “goal” used in 11246 plans for minorities and women.  Contractors will have the option of calculating their own benchmark from a variety of information sources, or using the benchmark published on the OFCCP’s website (which is currently at 8%). OFCCP recognizes that precise and statistically meaningful data demonstrating the availability of protected veterans which is similar to the information used to calculate the availability and establish goals for women and minority under the EO 11246 program does not exist. Accordingly, contractors “will not be cited for violations solely for failing to meet the benchmarks they set.”

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 hiring benchmarks may be calculated under the new regulation by taking into account the following factors:

 

 (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 § 60– 300.44(k);

(iv) The contractor’s recent assessments of the effectiveness of its external outreach and recruitment efforts, as set forth in § 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.

Self-identification.  Another one of the next most significant changes is that contractors will now be required to invite employees and applicants to voluntarily self-identify their “protected veteran status.” The invitation should be extended at the same time that applicants are invited to self-identify as women or minorities.  In addition, as is currently required, contractors which are required to file a VETS-100A form must again invite candidates to self-identify after a job offer has been extended, but the post-offer invitation will require more specification about the type(s) of protected veteran the employee is.  As with other affirmative action self-identification solicitations, responding is purely voluntary and the information must be kept confidential. Sample self-identification forms are included in Appendix B to the regulations.

Once this data is collected, the contractor will be expected to analyze it during an annual audit to determine the effectiveness of its affirmative action program, recruitment and outreach efforts:

 

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.

In the past, contractors have been required to make the entire AAP for disabled and veterans available for inspection upon request to applicants and employees, unlike the 11246 plans.  However, now that employers will be required to analyze utilization goals, critique their efforts and utilize other metrics which may involve confidential employee data, the new regulation permits employers to withhold those portions of the AAP which includes “the data metrics required by § 60–300.44(k)” [the analysis of the self-identification data].

Job listings. It has long been a statutory requirement that covered contractors list all job openings [except for executive and senior management, jobs filled with only internal candidates and jobs lasting three days or less] with “the appropriate employment service delivery system’’ (ESDS).  The new regulations  require such listings to be made ‘‘in a manner and format permitted by” the ESDS.  Moreover, contractors will now be required to notify the ESDS that it is a covered federal contractor:

it shall advise the [ESDS] 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 an receive priority referrals from employment service delivery systems.  . . .  The disclosures required by this paragraph shall be made simultaneously 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 [ESDS] location, the contractor shall provide updated information simultaneously with its next job listing.  . . .  The contractor may advise the employment service delivery system when it is no longer bound by this contract clause.

Audit and Reporting Systems.  Once this data is collected, the contractor will be expected to analyze it during an annual audit to determine the effectiveness of its affirmative action program and outreach efforts.  In particular, the new regulation provides as follows:

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 § 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

(5) The total number of applicants hired.

In addition, the contractor will be required to document the following auditing actions and maintain those records for three years:

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;

             . . . .

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.

Advertising and Solicitations.  Contractors will now be required to add the word, “protected veteran status” to their EEO statement in job advertisements and solicitations.  For instance, contractors now need to say: ‘‘all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, disability, protected veteran status or national origin.’’

Federal contracts and subcontracts.  Contractors will be required to include the following clause – in bold typeface --  in all of their covered subcontracts and purchase orders in excess of $100,000:

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.’’

Record Retention.  The new regulations extend the document retention period to three years.

Internal dissemination of affirmative action policy.  The new rule also makes mandatory certain actions to disseminate the policy among the workforce:

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;

While these are the most salient changes, the devil is in the details.  All covered contractors are recommended to read the new rule and explanatory comment in detail.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.