The face of “affirmative action” further changed for federal government contractors as of September 21, 2026.  Notwithstanding the elimination of Executive Order 11246 in January 2025, federal government contractors continue to have ongoing obligations under Section 503 of the Rehabilitation Act (Section 503) and the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) to take “affirmative action” to ensure the employment, respectively, of individuals with disabilities and covered veterans.  We discussed those obligations as part of our DEI in Crisis series last year.  And as we forecast at that time, what the Department of Labor (DOL) means by “affirmative action”, at least for individuals covered by Section 503, is changing. 

 Goals and Inquiries Have Ended 

Since 2014, DOL regulations had required larger federal contractors to measure the percentage of individuals with disabilities they had working on federal contracts and conduct an annual analysis of whether and how they could approach or achieve meeting a federally-defined “utilization goal” of seven percent of the workforce.  The DOL’s recent regulatory changes have eliminated the utilization goal itself and end the related analysis required of contractors.   

The DOL reasoned that contractors might use the utilization goal as an unlawful quota. Rejecting the analysis behind the adoption of these regulatory requirements under the Obama administration, the DOL also determined that the process for gathering the necessary data, which involved employers asking applicants and employees to voluntarily disclose whether they identified as an individual with a disability, conflicts with the requirements of the Americans with Disabilities Act, which restrict inquiries about an individual’s disability status.  While the inquiries were framed as voluntary and allowed individuals to decline to answer, the DOL concluded that the ADA does not recognize a voluntariness exception.  At the pre-offer stage, such inquiries are flatly impermissible and thereafter the DOL explained, they are expected to be job-related and consistent with business necessity.  The current DOL concluded that the inquiries did not meet that legal threshold. 

Privacy and Consistency Take Priority 

The DOL acknowledged that provisions in the existing regulations excuse employers from liability under the ADA for collecting data under these circumstances, but the DOL stated it is better to structure regulatory schemes that harmonize with one another, rather than provide employers with a legal defense to internally conflicting legal requirements. 

The DOL also stated that it had received numerous inquiries from stakeholders who felt the inquiry into individuals’ disability status presented privacy concerns.  The DOL acknowledged that federal government contractors are required to keep disability disclosures confidential and not use them for employment decisions, but it cited the practical pressures that individuals may experience when presented with such an employer-initiated inquiry. 

Soundness of the Rationale 

The practical pressures to disclose information in response to employer inquiries, and concerns about the implications of such a disclosure, are not insignificant.  Nor in my experience are they cured by reassurances of confidentiality. There also is something refreshing about the DOL’s reasoning that creating internally consistent regulatory schemes is preferable to adopting safe harbor clauses for employers that face liability risks while trying to navigate competing or conflicting legal obligations.  In other words, the DOL’s changes are not irrational, and they will make compliance simpler for employers.  They also will relieve some of the angst that those with hidden disabilities may have felt about whether to honestly answer employer inquiries about their disability status. 

What “Affirmative Action” Remains 

Under the revised regulations, employers’ affirmative action obligations will center on reviewing their practices, job qualifications and advancement opportunities to assess whether and where they present compliance gaps or barriers for individuals with disabilities.  The DOL said this may include reviewing actions taken in response to reasonable accommodation requests or auditing the contractor’s workplace accessibility. 

The DOL’s regulatory changes additionally included clean-up to revoke regulations related to administrative proceedings  and other cross-references under Section 503 and VEVRAA that were tied to now revoked Executive Order 11246.  Those changes will take effect on December 21, 2026. 

Finally, the DOL clarified that it was not altering existing regulations under VEVRAA, which include asking job applicants and employees to disclose if they are a “protected veteran” within the meaning of the statute.  The DOL commented that while protected veterans include those who are disabled, the disclosure at the pre-offer stage does not extend to identifying the specific category under which an individual qualifies as protected, and the definition of a “disabled veteran” also is not synonymous with the definition of an individual with a disability under the ADA.  The DOL thereby engaged in some hair-splitting that reflects a broader inclination not to interfere too much with existing federal protections for veterans, as contrasted with the regulatory scheme for other characteristics protected under federal law. 

Endings Create Opportunities – for Those Who Seek Them 

The DOL is focused on removing the historic structure of affirmative action wherever it can (with the notable exception of certain protections for veterans).  That has created an enormous shake-up through the near elimination of a division within a federal agency (the Office of Federal Contract Compliance Programs) and the corollary loss of jobs supporting the work that agency had been overseeing.  While I do not want to overlook or ignore the impact of that change, enough time should have passed at this point for us to move beyond shock and acknowledge that the existing system and the cottage industry it supported was not actually solving the problem it was created to address.  Two or three generations after it was first instituted, the historic approach to affirmative action did not eliminate racial and gender disparities in American workplaces.   

The dismantling of the old structure presents an opportunity for organizations and the government to think differently: 

• Do women, minority groups, and disabled individuals face greater challenges being hired and advancing in the current American workplace?  Statistically, the data suggests that they do, even though on an individual, anecdotal level, it is possible to cite examples of individuals with those characteristics who had greater opportunities to succeed than certain white, male, non-disabled peers. 

• If statistically significant numbers of women, or minority groups, or disabled individuals are not represented in certain job categories in the workplace to the degree that one would expect based on the numbers of individuals who on paper would appear to be qualified for the positions being considered, why is that?  Is there a causal relationship to those protected characteristics or only a correlative relationship?   

• If there is a causal relationship, how do we address it in a manner that does not raise up individuals in one demographic group at the expense of another group?   

• If there is a correlative relationship, how do we address the sense of unfairness, abandonment, and tokenism that so many women, individuals in racial and ethnic minority groups, and disabled individuals experience in workplace settings? 

Some DEI professionals and organizations are asking those questions, many are not.  Those who assume they just need to lie low for another two years and then rebuild the old system under a new presidential administration are likely mistaken.  We need to move beyond the same old practices — they did not fully work, based on recent Supreme Court decisions their continued legality is suspect at best (and those decisions do not pivot with a change in the presidency), and many Americans are resentful of past methods that seemed to unfairly exclude or constrict opportunities for them or members of their family who did not qualify for affirmative action protections.   

Eliminating affirmative action will not erase inequalities in our workplaces, but preserving or restoring old style affirmative action has not done so either.  Now is the time for a creative rethinking of how we recruit, hire, train, and promote employees. 

By Tracey I. Levy