Federal Contractors Required to Wind Down Affirmative Action Plans

On June 27, 2025, the Office of Federal Contract Compliance Programs (OFCCP) issued a letter requesting federal contractors to submit information about their efforts to wind down compliance with Executive Order (EO) 11246, which was rescinded on January 21, 2025. The deadline to submit this information is September 25, 2025, and submission is voluntary. EO 11246 required federal contractors to create and implement affirmative action plans for women and minorities. The purpose of affirmative action plans was to ensure that applicants and employees were treated equally in regards to race, color, religion, sex, sexual orientation, gender identify, or national origin.

Federal contractors and subcontractors should make efforts to wind down compliance with EO 11246 by:

• Reviewing employment practices-including hiring, promotions, terminations-for goals based on race or gender, targeted outreach efforts, or any other practices aimed towards any specific demographic group.
• Reviewing all requirements of new contracts before certifying compliance.
• Considering whether to reach out to legal counsel to determine if it is in the organization's best interest to submit information about wind-down efforts to the OFCCP.

The Department of Labor (DOL) has also proposed changes to requirements for Section 503 of the Rehabilitation Act of 1973 (Section 503), which prohibits disability discrimination. Additionally, the OFCCP has proposed changes to the Vietnam Era Veterans' Readjustment Assistance Act (VEVRAA), which addresses nondiscrimination against veterans in employment.

The DOL has proposed the following changes to Section 503:

• Remove all cross-references to EO 11246.
• Rescind regulations requiring contractors to invite applicants and employees to self-identify their disability status.
• Rescind utilization goal requirements, including the requirement to conduct a utilization analysis.

The OFCCP has proposed the following changes to VEVRAA:

• Remove all cross-references to EO 11246.
• Remove all administrative enforcement proceedings related to EO 11246.

It's important to note that these changes are proposed, and it is unknown whether they will take effect. Section 503 and VEVRAA apply only to employers with federal contracts or subcontracts of $10,000 or more. Federal contractors meeting this threshold must continue to comply with current nondiscrimination requirements under both laws. Contractors with 50 or more employees and contracts over $50,000 (for Section 503) and $150,000 (for VEVRAA) must continue to develop and maintain written affirmative action plans in compliance with current requirements.

Affirmative Action Plan Wind-Down Checklist

• Discontinue maintaining AAPs based on race and sex.
• Stop the use of placement goals based on race and sex.
• Evaluate hiring, promotion, compensation, and termination processes to determine if any metrics related to EO 11246 (i.e., women and minorities) are tied to those processes. If there are metrics related to EO 11246, eliminate them.
• Evaluate DEI initiatives to ensure that the programs do not have any preferences based on race and/or sex.
• Continue to maintain AAP obligations under Section 503 of the Rehabilitation Act of 1973 (Section 503), which prohibits disability discrimination, and the Vietnam Era Veterans' Readjustment Assistance Act (VEVRAA), which prohibits discrimination against veterans.
  • Section 503 Obligations
    • Offer the opportunity to self-identify as an individual with a disability at the following:
      • Each applicant at the pre-offer phase of the hiring process
      • Each applicant at the post-offer phase of the hiring process
      • Every five years
      • Remind employees during the intervening five years that they may voluntarily update their disability status at any time.
    • Perform annual utilization analysis, comparing the representation of individuals with disabilities in the organization's workforce to the total number of employees in the workforce. (Provided in written AAP report.)
    • Measure the progress and effectiveness of outreach and recruitment efforts.
  • VEVRAA Obligations
• • Offer the opportunity to self-identify as a veteran to the following (no specific form required to be used):
    • Each applicant at the pre-offer phase of the hiring process
    • Each applicant at the post-offer phase of the hiring process
  • VETS-4212 Federal Contractor Veterans' Employment Report
    • Complete and submit the VETS-4212 report annually each year by September 30. More information on VETS-4212 reporting may be found here.
  • Post employment openings with an appropriate employment service delivery system (executive and top management positions, positions that will be filled internally, and positions lasting 3 days or less do not have to be posted here). Find the correct employment service delivery system here (varies by state).
  • Compare the percentage of hires and employees promoted to the VEVRAA hiring and promotion benchmark. (Provided in written AAP report.)
  • Measure the progress and effectiveness of outreach and recruitment efforts.
• Document all steps taken to cease activities related to EO 11246.
• Consider whether to voluntarily submit documentation showing EO 11246 efforts to the OFCCP. It's recommended to consult legal counsel before submitting any information.

Article reposted with permission from our sister association Cascade Employers Association.