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Contrary to OFCCP assertions, proposed hiring goal for individuals with disabilities is a quota, says expert, but it would not be unlawful

January 12th, 2012  |  Cynthia L. Hackerott

Despite the OFCCP’s statements to the contrary, the proposed national utilization goal for individuals with disabilities contained in the OFCCP’s proposal to amend its regulations implementing Section 503 of the Rehabilitation Act of 1973 is a quota, OFCCP expert John C. Fox stated during a webinar on the proposal presented by the National Employment Law Institute (NELI). He explained, however, that hiring quotas for the disabled are lawful because individuals without disabilities are not a protected class. Disability law expert David K. Fram joined Fox for the January 10, 2012, webinar on the OFCCP’s Notice of Proposed Rulemaking (NPRM) that was published in the Federal Register on December 9, 2011 (76 FR 77056-77105).

Specifically, the OFCCP is suggesting that federal contractors would be required to set a hiring goal of having seven percent of their employees be workers with disabilities in each job group of the contractors’ workforce, but it is soliciting comments on the potential use of a utilization range between four and ten percent. To annually evaluate their utilization of individuals with disabilities, the NPRM proposes that contractors use the job groups established for utilization analyses under their Executive Order (E.O.) 11246 affirmative action programs (AAPs). The proposed goal is derived primarily from disability data collected as part of the Census Bureau’s American Community Survey.

In an agency statement announcing the NPRM, OFCCP Director Patricia A. Shiu said, “What gets measured gets done.” This statement reveals that the “goal” is actually a quota because measuring the disabled makes hiring the disabled in like proportion implied, according to Fox.

The proposal would also require each covered contractor, on an annual basis, to review the outreach and recruitment efforts it has undertaken over the previous twelve months and evaluate their effectiveness in identifying and recruiting qualified individuals with disabilities. Fox noted that, in the preamble to the NPRM, the OFCCP states “The primary indicator of effectiveness is whether qualified individuals with disabilities have been hired” (Fox’s emphasis). This statement means that 51 percent or more of the effectiveness calculation for each contractor would be whether a contractor has met the hiring goal, according to Fox. Thus, the statement renders the goal a quota and moves the requirement from recruitment to hiring.

Homogenization with ADAAA. The NPRM would also incorporate updates to the OFCCP’s Section 503 regulations made necessary by the ADA Amendments Act of 2008 (ADAAA). The ADAAA amends both the ADA and the Rehabilitation Act with respect to the definition of “disability” and related issues. Consequently, the proposal includes revisions that are needed to make the Section 503 regulations consistent with the ADAAA and with the revisions to the ADAAA implementing regulations made by the EEOC in March 2011.

Fram presented a detailed discussion on how the definition of disability has greatly expanded under the ADAAA.  Both Fram and Fox said that the OFCCP did a good job of proposing amendments to the current Section 503 regulations designed to homogenize it with the changes made to the statute by the ADAAA.

Three invitations to self-identify. Fox pointed out that, under the proposals, contractors would be required to extend three types of invitations to self-identify, one “pre-offer” and two “post-offer.” The pre-offer invitation would gather self-identification data alerting the contractor to the number of individuals with disabilities applying for jobs with the contractor and its purpose would be to help the OFCCP start building an “availability” database and to help the contractor set hiring goals, he explained. Under the proposal, a contractor would be required to extend the first post-offer invitation after it extends an offer of employment but before the applicant begins his/her job duties. Contractors would also be required to annually survey employees to provide them with the opportunity to voluntarily and anonymously self-identify, thus creating a second post-offer invitation requirement.

Fram and Fox both agreed with the OFCCP assessment that requiring contractors to invite applicants to self-identify as disabled would not violate the general prohibition, contained in the ADA and Section 503, against pre-offer disability-related inquiries because the ADA and Section 503 regulations permit the contractor to conduct a pre-offer inquiry into disability status if it is made pursuant to a federal, state or local law requiring affirmative action for individuals with disabilities.

The NPRM provides that the OFCCP will prescribe the language that contractors will be required to use when inviting self-identification and publish it on the OFCCP website. Fox noted that NPRM does not contain a suggestion for what this language would be.  He said that uniform invitation language may be difficult because what works for one company may not work for another. He reported that contractors have found that invitations to self-identify as to race and sex (as currently required by the regulations implementing E.O. 11246) need to vary geographically in order to maximize response rates, and wondered if the same might be true regarding individuals with disabilities.

Documentation. Fox said, and Fram agreed, that seven percent is a “modest” goal relative to the percentage of available applicants and employees who are in fact disabled because under the ADAAA and the EEOC regulations implementing the ADAAA, the definition of “disability” is now very broad. However, there is a “big disconnect” between this modest goal and the requirement for documenting it, Fox observed, and Fram again agreed. Fox explained that documenting the percentage of applicants, hires and incumbent employees with disabilities is going to be very difficult because people often hide disabilities because they consider them to be private or fear disclosing them. Fox said that real world experience among federal contractors for the last 30 years of inviting those who have been offered a job to self-identify is that usually only one to three percent report they are disabled. 

Sub-goal. The OFCCP is also considering the possible inclusion of a two percent sub-goal for individuals with certain particularly severe or targeted disabilities (such as: total deafness; blindness; missing extremities; partial and complete paralysis; epilepsy; severe intellectual disability; psychiatric disability; dwarfism). But Fox said that documenting this sub-goal would be problematic because the OFCCP states that the pre-hiring offer invitation to self identify contractors would be required to use is only for general self identification as to the existence of a disability and does not seek information as to the nature or type of disability the person has.

Linkage agreements. The proposal would require a contractor to enter into three kinds of  “linkage agreements.” A “linkage agreement” means an agreement describing the connection between the contractor and appropriate recruitment and/or training sources. The first required linkage agreement would be with the local State Vocational Rehabilitation Agency office nearest the contractor’s establishment, or a local organization listed in the Social Security Administration’s Ticket to Work Employment Network Directory. The second would be a linkage agreement with at least one of six other listed organizations involved in recruitment and developing training opportunities for individuals with disabilities. Third, the contractor would be required to establish a linkage agreement with one disabled veterans service organization listed in the National Resource Directory (a partnership and online collaboration among the Departments of Labor, Defense, and Veterans Affairs).

The OFCCP has placed a lot of focus on these agreements as a means for contractors to find qualified individuals with disabilities, Fox said, but he added that history has shown employers rarely find good candidates from these sources. In addition, contractors generally do not have difficulty finding job seekers; more often, they have to wade through large numbers of applicants for a given opening.

Reasonable accommodation. The proposed revisions would require that contractors develop and implement written procedures for processing requests for reasonable accommodation. In addition, certain disability accommodation “best practices” would become mandatory, Fox said. Among these new requirements, contractors would be required to provide a statement of reasons explaining the circumstances for rejecting disabled individuals for vacancies and training programs and a description of considered accommodations. This requirement would necessitate consultation with legal counsel and will be substantially time-consuming, Fox noted, adding that  sourcing would be difficult because most accommodations are accomplished locally, with no documentation, and no “bally-who.”

Contractors would also be required to catalogue the nature and type of accommodations for disabled individuals who were selected for hire, promotion, or training programs. This requirement raises confidentiality concerns, Fox said.

Required policy statement. Under the proposal, contractors would be required to re-draft the Equal Employment Policy statement in their Section 503 AAPs, which under current regulations ‘‘should indicate the chief executive officer’s attitude on [affirmative action for individuals with disabilities],’’ so that the statement indicates “the chief executive officer’s support for the affirmative action program.’’ This aspect of the proposal presents a “profound First Amendment problem,” Fox observed, in that the government would be dictating what federal contractor CEOs should say they think.

Suggestions for writing comments on the proposal. Comments on the proposal are due by February 7, 2012. Fox told the webinars listeners that the federal contractor community is, in essence, “at trial” during this comment period. The purpose of NPRMs is not just to inform the public and gather comments, he said. Rather, the Administrative Procedure Act has created this process to allow a mass, visible and public trial of agency proposals. Courts have been striking down substantial regulations elsewhere, Fox noted, and they may to do so here as well if contractors submit comments that will provide courts, upon subsequent legal challenge, with evidence to support striking down the regulations at issue.  Evidence, Fox explained, means detailed information of the costs and time burdens that would be placed on contractors by these regulations. It does not mean “pabulum whining,” he emphasized.

The OFCCP’s calculation, submitted to the Office of Management and Budget, of total first year costs of these proposed regulations is $473 per contractor establishment, but many in the contractor community have accused the OFCCP of either outright lying about the costs, or being incredibly naive, he said. However, it is up to the contractor community, via written comments on the proposal, to provide specific evidence regarding how the OFCCP’s estimates about the projected burden of the proposal are flawed.

Fox recommended that contractor comments:

(1) be clear – the comments should either (a) support, (b) oppose, unless specified modifications are made, or (c) oppose unqualifiedly, the proposal;

(2) be succinct;

(3) be focused; and

(4) provide evidence supporting the commenter’s position.

Fox is the President and a founder of Fox, Wang & Morgan P.C. He leads large and complex litigation matters in state and federal courts, in cases involving wage-hour and discrimination class actions, trade secret claims, employment contract disputes, wrongful termination, corporate investigations, and the use of statistics in employment matters. Fox previously served as Executive Assistant to the Director of the OFCCP, where he was responsible for all enforcement and policy matters.

David K. Fram is NELI’s Director of ADA and EEO Services. Fram has trained tens of thousands of HR professionals and attorneys, and testified before Congress about the ADA Amendments Act.  Prior to joining NELI, Fram served as Policy Attorney at the EEOC, where he helped formulate the federal guidelines implementing the ADA.