From the Hotline: Affirmative Action Plans

Question: Is an employer required to have an affirmative action plan if the company has state contracts (particularly from states that may get federal funding)?

Answer: Check the terms of the contract for each state to determine the funding of the contract and the compliance provisions. Many states have affirmative action program requirements for state government contractors, and the federal contracts rules may apply to subcontractors as well as prime contractors.

In general, however, there are three separate laws that require certain employers that do business with the federal government to implement affirmative action programs:

  • Section 503 of the Rehabilitation Act of 1973 requires contractors with contracts over $10,000 to take affirmative action with regard to qualified individuals with disabilities.
  • The Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA) requires contractors to take affirmative action to employ and advance in employment veterans with service-connected disabilities, recently separated veterans, and other protected veterans. VEVRAA requires the following:
    • For employers with contracts entered into before December 1, 2003 that have 50 or more employees and contracts of $25,000 or more, these employers are “required to take affirmative action,” and those with 50 or more employees and $50,000 in contracts would be required to have a written affirmative action program.
    • For employers with contracts entered on or after December 1, 2003, contractors with 50 or more employees and a contract of $100,000 or more would be required to have a written affirmative action program.
  • Executive Order 11246 requires that federal contractors and subcontractors with 50 or more employees who have entered into at least one contract of $50,000 or more with the federal government have a written affirmative action program that is prepared within 120 days from the beginning of the contract and updated annually.