Labor & Employment Developments Blog

On August 21, 2026, the U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) published three coordinated final rules that significantly reshape federal contractor compliance obligations. These rules follow the revocation of Executive Order 11246 by President Trump in January 2025. Prior to President Trump’s revocation, Executive Order 11246 had been a longstanding order that required federal contractors to maintain race- and sex-based affirmative action programs since 1965. Below is a summary of each final rule. 

1. Rescission of Executive Order 11246 Implementing Regulations

• This final rule becomes effective October 26, 2026.
• Key changes: This rule rescinds all regulations that the Department of Labor (DOL) had implemented related to EO 11246, including 41 CFR Parts 60-1, 60-2, 60-3, 60-4, 60-20, 60-30, 60-40, 60-50, and 60-999. Effectively, this rule eliminates federal contractor affirmative action obligations based on sex and race.
• Important Note: Federal contractors must still comply with any applicable state and/or local affirmative action obligations, so it is important to stay aware of such obligations.

2. Modifications to the Regulations Implementing Section 503 of the Rehabilitation Act of 1973, as Amended

• This final rules becomes effective September 21, 2026.
• Key changes: This rule rescinds the requirement that federal contractors invite applicants and employees to self-identify as individuals with a disability. Additionally, the rule eliminates the 7% utilization goal for individuals with disabilities. Finally, the rule removes data collection and utilization analysis obligations.
• Important Note: Federal contractors should note that they must still take affirmative action to employ and advance qualified individuals with disabilities, maintain a written Affirmative Action Plan, and assess outreach effectiveness, but without mandatory data collection.

3. Modifications to the Regulations Implementing the Vietnam Era Veterans' Readjustment Assistance Act of 1974 (VEVRAA), as Amended

• This final rules becomes effective September 21, 2026.
• Key changes: This rule is much less impactful for federal contractors as it makes technical changes to VEVRAA regulations and updates the coverage threshold from $150,000 to $200,000 as a result of inflation.

Taken together, these three rules represent a significant shift in federal contractor compliance obligations — most notably the complete dismantling of EO 11246's affirmative action framework and a scaling back of disability self-identification and utilization requirements under Section 503.