OFCCP Finalizes Major Changes to Federal Contractor Affirmative Action Regulations

New rules eliminate the Executive Order 11246 framework, substantially narrow Section 503 requirements, and make primarily technical changes to VEVRAA

On August 21, 2026, the U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) published three final rules, which can be found here Regulatory Actions | U.S. Department of Labor, that significantly reshape the affirmative action requirements applicable to federal contractors.  With these updates, federal contractors will no longer be subject to OFCCP’s race- and sex-based affirmative action requirements under Executive Order 11246, and several important disability-related requirements under Section 503 of the Rehabilitation Act will be eliminated. Contractors’ substantive affirmative action obligations for protected veterans under the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) will remain largely unchanged.

The VEVRAA rule and most Section 503 amendments take effect September 21, 2026. The rescission of the Executive Order 11246 regulations takes effect October 26, 2026. A separate administrative enforcement change becomes effective December 21, 2026, but that amendment primarily concerns OFCCP's internal enforcement procedures rather than contractors' day-to-day compliance obligations.

The most sweeping rule formally rescinds the regulations implementing Executive Order 11246, which President Trump revoked in January 2025 through Executive Order 14173. The Department also concluded that significant portions of the prior framework were legally vulnerable under constitutional principles, federal civil rights laws, and existing statutory authority.

Effective October 26, 2026, covered contractors will no longer be required under Executive Order 11246 to:

• Prepare or maintain written affirmative action programs for women and minorities;
• Conduct race- or sex-based utilization and availability analyses;
• Identify underutilization of women or minorities;
• Establish or monitor placement goals; or
• Comply with minority and female participation goals applicable to construction contractors.

The rule also removes OFCCP’s Executive Order 11246 enforcement provisions and related administrative procedures.  Since President Trump’s issuance of Executive Order 14173 and related requirement for federal contractors to wind down their women and minority affirmative action plans by April 25, 2025, the recission of the implementing regulations in this final OFCCP rule will not have significant practical impact.

Importantly, contractors remain subject to other important civil rights legislation, including Title VII, Section 1981, the Equal Pay Act, and applicable state and local nondiscrimination laws.

The second final rule revises, but does not repeal, the regulations implementing Section 503 of the Rehabilitation Act. OFCCP stated that the changes are intended to align the regulations with applicable law and recent executive orders. The Department identified concerns that mandatory disability self-identification inquiries may conflict with the Americans with Disabilities Act, that the 7% disability utilization goal could encourage quota-like practices, and that the utilization analyses depend on job-group structures established under the now-revoked Executive Order 11246 framework.

Beginning September 21, 2026, contractors will no longer be required to:

• Invite applicants or employees to self-identify as individuals with disabilities;
• Use OFCCP’s prescribed disability self-identification form;
• Conduct periodic employee disability surveys;
• Collect the related disability applicant and hiring statistics;
• Apply the 7% utilization goal;
• Conduct annual analyses against that goal; or
• Implement action-oriented programs based on failure to meet the goal.

The rule also updates the Section 503 coverage threshold to $20,000 and relocates certain administrative enforcement provisions previously linked to the Executive Order 11246 regulations.

Section 503 itself remains in effect. Covered contractors must continue to refrain from disability discrimination, provide reasonable accommodations, comply with remaining recordkeeping requirements, maintain an annual Section 503 affirmative action program, and asses the effectiveness of outreach and recruitment efforts.  The ADA and other applicable disability-discrimination laws also remain fully effective.

The VEVRAA rule is primarily technical and conforming. It removes obsolete references to Executive Order 11246, places applicable administrative procedures directly within the VEVRAA regulations, and updates the regulatory coverage threshold from $150,000 to $200,000 to reflect an inflation adjustment that became effective October 1, 2025.

Unlike the other two rules, the VEVRAA rule does not materially reduce contractors’ substantive obligations. Covered contractors must continue to prohibit discrimination against protected veterans, take affirmative action to employ and advance qualified protected veterans, maintain required veteran affirmative action programs, conduct outreach and recruitment, and satisfy applicable recordkeeping and reporting requirements.

Recommended Employer Actions

1. Discontinue federal women and minority affirmative action and major portions of disability affirmative action plans. If you have not already, contractors should discontinue women and minority affirmative action plans for federal law compliance. Employers may also discontinue individuals with disability self-identifications, related reminders, goal-setting, and annual utilization analysis and related action-oriented programs.  Employers should also review voluntary DEI initiatives as well as any state or local affirmative action obligations separately to ensure they remain consistent with federal, state, and local law.
2. Review internal procedures, compliance documents, and make necessary updates.  Federal contractors should promptly review their affirmative action plans, applicant, and employee self-identification processes, recruiting procedures, compliance manuals, and recordkeeping practices to make updates necessitated by these new rules.
3. Evaluate what applicant and/or employee data you will continue to maintain.  Given this OFCCP regulatory update and the EEOC’s proposal to eliminate EEO-1 reporting, coordinate with counsel on whether and to what extent race, sex, and/or disability data should and can be solicited and for what purpose.

Remind your teams that many civil rights laws remain in place.  Sometimes, nondiscrimination obligations run together, so with these recissions hitting core federally protected classes, it is helpful to remind managers and other business associates that other federal and civil rights law, such as Title VII, the ADA, and the Equal Pay Act remain in place.

Please do not hesitate to reach out to any member of the firm's Labor and Employment practice group with questions about how these developments might affect your organization.