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What is the OFCCP?

Companies that do business with the U.S. federal government, including subcontractors, have certain responsibilities when it comes to employment practices. If you’re a federal contractor, you must ensure you don’t discriminate against workers for reasons such as race, religion and gender identity. Some businesses may also need to create affirmative action plans. The Office of Federal Contract Compliance Programs (OFCCP) oversees enforcement of these laws.

If your business is a federal government contractor or subcontractor, you may also be subject to OFCCP audits. Here’s what you need to know about OFCCP compliance in the workplace.

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What is the OFCCP?

The OFCCP is a federal civil rights agency operating within the U.S. Department of Labor. It promotes diversity by ensuring job applicants and employees aren’t discriminated against because of:

  • Race
  • Color
  • Religion
  • National origin
  • Disability
  • Sex
  • Sexual orientation
  • Gender identity
  • Protected veteran status

Businesses must treat all job applicants and employees equally when it comes to finding candidates, hiring, compensation, advancement, demotions and layoffs.

The OFCCP accomplishes its mission in several ways:

  • Compliance support: Employers can get help understanding and complying with OFCCP requirements through webinars, online video training, samples, document templates and technical assistance guides. Employers and workers may call the OFCCP help line at 1-800-397-6251 to ask specific questions about labor laws and implementing fair practices.
  • Compliance monitoring: The agency ensures compliance by evaluating the employment practices of selected companies each year. Companies are picked for evaluations using a neutral process that may focus on certain industries, sectors or geographic regions.
  • Complaint investigation: Complaints filed by job candidates or employees alleging discrimination by a contractor are investigated. If the OFCCP finds violations, it helps negotiate settlements and correct employment practices.

What companies are subject to OFCCP compliance?

All federal contractors and subcontractors must meet the basic principles of nondiscrimination and equal employment opportunity no matter how many employees they have.

Businesses with government contracts exceeding a certain value have additional obligations and reporting requirements as outlined in three laws enforced by the OFCCP.

Executive Order (EO) 11246

EO 11246 prevents discrimination against job applicants and employees because of religion, race, color, sex, sexual orientation, gender identity and national origin. It also makes it illegal for businesses to take negative action against staff members who discuss their compensation.

  • EO 11246 requirements apply to businesses with federal contracts or subcontracts exceeding $10,000. This includes federally assisted construction contracts.

Section 503 of the Rehabilitation Act of 1973

Section 503 protects qualified individuals who have physical or mental impairment or disabilities.

  • Section 503 requirements apply to businesses with federal contracts or subcontracts for supplies, services or direct construction exceeding $15,000. Federally assisted construction contracts are exempt.

Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA)

VEVRAA ensures equitable treatment of protected veterans, including those who are disabled, recently discharged from active duty, recipients of Armed Forces service medals, and active duty wartime or campaign badge veterans.

  • VEVRAA requirements apply to companies with federal contracts or subcontracts for supplies, services or direct construction of $150,000 or more. Federally assisted construction contracts are exempt.

Affirmative action plan requirements

Some federal contractors, in addition to protecting workers from discrimination, must develop and implement affirmative action plans (AAPs). These plans outline efforts to help women, minorities, and people with disabilities advance their careers. Programs may focus on training, mentorship and outreach. AAPs must be formal, written policies that are reviewed annually and available to the OFCCP upon request.

  • Companies with at least 50 employees and contracts of $50,000 or more must have AAPs for EO 11246 and Section 503.
  • Companies with at least 50 employees and contracts of $150,000 or more must have AAPs for VEVRAA.

OFCCP FAQs

What’s the difference between OFCCP and EEOC?

The Equal Employment Opportunity Commission (EEOC) is a federal agency that protects workers from discrimination in private businesses that haven’t been awarded government contracts. The OFCCP’s mandate oversees compliance among federal government contractors and subcontractors.

What does the OFCCP audit?

Evaluations are performed to ensure businesses are complying with all OFCCP requirements under EO 11246, Section 503 and VEVRAA. This may involve an off-site review of affirmative action plans, job ads, personnel data, employee records, and other technical requirements. It’s good practice to develop a record retention policy to ensure documents are easily retrieved. While some evaluations may be considered complete after a desk audit, in some cases the OFCCP may conduct on-site reviews of employment practices.

What’s a government contractor?

Government contractors are businesses that submit bids to provide services and supplies to the U.S. federal government and are successfully awarded contracts. Your business is a prime federal contractor if it works directly with the government. If your business is hired by another contractor, you may be considered a subcontractor. You can take a subcontractor test on the Department of Labor website to confirm whether the work you do for another business is considered a federal subcontract.

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