CLIENT ALERT: OFCCP Revises Section 503 and VEVRAA Compliance Requirements

OFCCP has finalized changes to Section 503 and VEVRAA following EO 14173, which revoked EO 11246. Most revisions take effect September 21, 2026, changing affirmative action, self-identification, utilization analysis, and coverage requirements. Government contractors should understand what changed, what remains in place, and when compliance processes may need to be updated.

Background

On August 21, 2026, the Department of Labor’s (DOL) Office of Federal Contractor Compliance Programs (OFCCP) published three final rules addressing its regulatory framework following the revocation of EO 11246. One final rule rescinds the regulations that implemented EO 11246, while the other two modify the regulations implementing Section 503 of the Rehabilitation Act of 1973, as amended, and the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) of 1974, as amended. The Section 503 and VEVRAA changes are generally effective September 21, 2026, while the rescission of the EO 11246 implementing regulations is effective October 26, 2026.

OFCCP initially proposed the changes in July 2025 following the issuance of EO 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity, which revoked EO 11246, Equal Employment Opportunity. Because the Section 503 and VEVRAA regulations contained cross-references to EO 11246, its revocation created questions regarding how those remaining regulations would operate. DOL states that the revisions are intended to align the regulations with EO 14173, EO 14219, Ensuring Lawful Governance and Implementing the President’s ‘Department of Government Efficiency’ Deregulatory Initiative, and applicable law.

Why These Changes Matter for Government Contractors

The final rules do more than remove outdated references to EO 11246. For government contractors subject to Section 503, the changes eliminate several longstanding requirements, including disability self-identification and utilization analysis, while leaving the underlying affirmative action and equal employment opportunity obligations in place. VEVRAA requirements remain largely unchanged, but government contractors should account for the increased coverage threshold and related regulatory updates. Understanding which requirements have been removed, which remain, and when each change becomes effective is important when updating affirmative action programs, HR processes, policies, notices, and recordkeeping practices.

Section 503 of the Rehabilitation Act of 1973

What Changed with Section 503?

• The threshold of coverage is updated to apply to all government contracts and subcontracts in excess of $20,000 “for the purchase, sale or use of personal property or nonpersonal services (including construction).” This is not a “change,” per se, but is consistent with adjustments for inflation by the Federal Acquisition Regulation Council.
• The regulations make clear that the Uniform Guidelines on Employee Selection Procedures (UGESP) do not apply to Section 503 and are therefore inapplicable. Note that this does not affect the broader existence of UGESP.
• The requirement to provide opportunities for self-identification of disability as part of the government contractor’s obligations under Section 503 or affirmative action has been removed. Pre-offer, post-offer, and the requirement to provide an opportunity to self-identify at least every five years are no longer applicable.
• The utilization goal and associated analyses will cease as requirements of Section 503.
• References to EO 11246 were removed, and existing procedural provisions were relocated into the Section 503 regulations.

What’s Still Required for Compliance?

Most other core Section 503 compliance obligations remain in place, including:

• Continue to practice equal employment and take proactive steps, or affirmative action, toward ensuring equal opportunity for qualified individuals with disabilities.
• Incorporate the Equal Employment Opportunity (EEO) clause into contracts and subcontracts and provide notice to vendors and unions.
• Maintain required records in accordance with applicable recordkeeping and retention requirements.
• Include the appropriate tagline in job postings stating that all qualified applicants will receive consideration and will not be discriminated against on the basis of disability.
• Ensure related policies and required posters are posted at physical establishments and available to applicants and remote workers.
• Provide OFCCP with access to related records and the worksite if audited.
• Provide reasonable accommodation to an otherwise qualified applicant or employee unless doing so would impose an undue hardship on the company.
• If a government contractor has 50 or more employees and a contract of $50,000 or more, an affirmative action program is required. Per the regulations, “An affirmative action program institutionalizes the contractor's commitment to equality in every aspect of employment and is more than a paperwork exercise...” This involves preparing and maintaining an affirmative action program for each establishment, which must be reviewed and updated annually. The program must be made available to OFCCP within 30 days of a request. In addition, the program must be available to employees and applicants upon request. With the exception of the removed data collection and utilization analysis requirements, the core plan requirements remain intact.

Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) of 1974

What Changed with VEVRAA Compliance?

Very little!

• The coverage threshold under VEVRAA increased from $150,000 to $200,000 in accordance with inflationary adjustment requirements.
• References to EO 11246 were removed, and administrative proceeding procedures were incorporated into the VEVRAA regulations.
• The regulations make clear that the Uniform Guidelines on Employee Selection Procedures do not apply to VEVRAA and are therefore inapplicable. Note that this does not affect the broader existence of UGESP.

What’s Still Required for Compliance?

Core VEVRAA compliance obligations remain in place, including:

• Continue to practice equal employment and take proactive steps, or affirmative action, toward ensuring equal opportunity for qualified protected veterans.
• Incorporate the Equal Employment Opportunity (EEO) clause into contracts and subcontracts and provide notice to vendors and unions.
• Complete annual VETS-4212 reporting.
• Include the appropriate tagline in job postings stating that all qualified applicants will receive consideration without regard to their protected veteran status.
• Ensure related policies and required posters are posted at physical establishments and available to applicants and remote workers.
• Provide OFCCP with access to related records and the worksite if audited.
• Provide reasonable accommodation to an otherwise qualified applicant or employee unless doing so would impose an undue hardship on the company.
• If a government contractor has 50 or more employees and a contract of $200,000 or more, an affirmative action program is still required, and those requirements have not changed. Government contractors must prepare and maintain an affirmative action program for each establishment, which must be reviewed and updated annually. The program must be made available to OFCCP within 30 days of a request. In addition, the program, absent analytics, must be available to employees and applicants upon request.
• Continue to provide an invitation to self-identify as a protected veteran both pre-offer and post-offer.
• List most employment openings with the appropriate Employment Service Delivery System (ESDS).
• Maintain required records in accordance with applicable recordkeeping and retention requirements.

How to Proceed

Continue with all efforts related to VEVRAA compliance. As for Section 503, the most substantial impact to processes and recordkeeping is the elimination of the invitation to self-identify as having a disability and the subsequent removal of utilization analysis. While this simplifies recordkeeping, it presents a new challenge. As part of their affirmative action obligations, government contractors must still identify issues of potential discrimination and measure the effectiveness of their outreach efforts. In fact, the regulations still read, “An affirmative action program is dynamic in nature and includes measurable objectives, quantitative analyses, and internal auditing and reporting systems that measure the contractor's progress toward achieving equal employment opportunity for individuals with disabilities.”

How are government contractors to do this without these analyses? That’s a great question and one that each government contractor must address in relation to its workforce. DOL also acknowledges that additional clarification is necessary. Although government contractors are no longer required to rely on quantitative disability data when evaluating their outreach and affirmative action efforts, they must still evaluate the effectiveness of those efforts using other appropriate measures.

Key Compliance Dates

Government contractors should be aware of several important implementation dates:

• September 21, 2026 – Most changes to the Section 503 and VEVRAA regulations become effective.
• October 26, 2026 – The rescission of the regulations implementing EO 11246 becomes effective.
• December 21, 2026 – Certain procedural changes involving 41 CFR part 60-30 become effective.

Government contractors should review their affirmative action processes, self-identification practices, policies, templates, and related compliance materials to determine what needs to change and what obligations remain in place.

Preparing for the Updated Section 503 and VEVRAA Requirements

As government contractors prepare for the updated Section 503 and VEVRAA requirements, Redstone GCI can help assess which compliance processes should change and which obligations remain in place. Our team of subject matter experts assists government contractors with reviewing affirmative action program requirements, disability and protected veteran self-identification procedures, job posting language, required notices and policies, outreach and recordkeeping practices, and related HR compliance processes. We can also help update internal procedures and documentation to reflect the revised requirements, provide training to HR and compliance personnel, and support government contractors in evaluating how they will measure the effectiveness of their Section 503 affirmative action efforts without the former disability utilization analysis requirements.