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Contractors Sue to Block Hiring Rule

Wednesday, November 27, 2013

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U.S. open-shop construction contractors have gone to court to stop a new federal affirmative-action proposal aimed at increasing hiring of people with disabilities.

Associated Builders and Contractors, which represents 19,000 construction and industry-related firms, filed a request for an injunction Nov. 19 in U.S. District Court for the District of Columbia, seeking to block implementation of the rule announced Aug. 27.

The suit accuses the Labor Department's Office of Federal Contract Compliance Programs (OFCCP) of overstepping its regulatory authority in issuing its Final Rule to Improve Job Opportunities for Individuals with Disabilities.

PeoplewithDisabilities
Department of Labor

The new rule, for federal contractors and subcontractors, would establish a 7 percent goal for hiring of people with disabilities.

The complaint seeks a judicial review of the order, which is set to take effect March 14, 2014.

2 Rules, 1 Complaint

The rule, for federal contractors and subcontractors, establishes a nationwide 7 percent hiring goal for qualified ndividuals with disabilities. The goal applies to each job group in a company with more than 100 employees, or to the entire workforce for companies with 100 or fewer employees.

The rule updates requirements under Section 503 of the Rehabilitation Act of 1973.

The disability hiring rule was released with a companion Final Rule to Improve Job Opportunities for Protected Veterans.

That rule, which updates requirements of the Vietnam Era Veterans' Readjustment Assistance Act of 1974 (VEVVRA), requires federal contractors and subcontractors to establish "annual hiring benchmarks for protected veterans," using one of several methods described in the rule.

Soldiers
tdcj.state.tx.gov

A second new rule updates requirements for hiring veterans, but ABC is not challenging that rule.

Contractors must also document and update annually "several quantitative comparisons for the number of veterans who apply for jobs and the number of veterans they hire."

The veterans' rule would also take effect March 14.

'Oppressive Measures'

The contracting industry opposed the rules from the start. When the rules were issued, the Associated General Contractors of America blasted both as "oppressive employment regulations" that would force federal contractors to spend about $6 billion annually to document actions they are already taking.

However, ABC's injunction request applies only to the disability rule. The complaint says that, unlike the original statute governing hiring of veterans, the 1973 Rehabilitation Act does not require contractors to collect and report hiring and employment data.

Furthermore, ABC argues, "There is no evidence in the administrative record that significant numbers of government contractors in the construction industry have failed to meet their affirmative action obligations under the previous OFCCP rule implementing Section 503."

Nor is there evidence that "imposition of burdensome data collection and utilization analysis requirements" is needed to satisfy affirmative-action goals for people with disabilities, the complaint says.

Longstanding Concerns

ABC and other construction groups and contractors have been making similar arguments since the rule was proposed Dec. 9, 2011. The proposal drew more than 400 comments in all, ABC's petition says.

As it has before, ABC notes in its petition that much of the construction workforce is "uniquely fluid and temporary" and that the industry's work is "uniquely physical and hazardous."

For those reasons, the construction industry has rightfully been exempt from similar affirmative-action rules before, ABC said. It also objected to the 7 percent hiring goal as "arbitrary."

Changing the Rules?

ABC's petition challenges what it calls a re-definition of affirmative action that newly applies the requirements to all government contractors employing 50 employees on contracts of more than $50,000.

Construction-ABC
ABC

ABC contends that construction employment is "uniquely fluid and temporary" and that the work is "uniquely physical and hazardous."

It also criticizes a provision that requires contractors to "invite all job applicants to voluntarily inform the contractor whether they are disabled before they receive offers of employment."

Another disputed requirement: Contractors who find that they are not meeting the quota for individuals with disabilities must "take steps to determine whether and where impediments to equal employment opportunity exist" and "develop and execute action-oriented programs designed to correct any identified problem areas."

Finally, the complaint notes, employees of construction contractors are spread over multiple worksites, and daily hiring decisions are often made in the field. Tracking all of these hires would be impossible, especially for the industry's many small businesses without Human Resources departments.

Employing People with Disabilities

ABC supports nondiscriminatory practices toward individuals with disabilities on government construction projects, "and we will remain committed to placing these individuals in good construction jobs,” ABC Vice President of Federal Affairs Geoff Burr said in a statement.

“However," Burr added, "this rule will do nothing to increase employment opportunities for individuals with disabilities.

"Instead, the new burdens it imposes mean many construction contractors are likely to stop pursuing government construction projects—particularly small businesses that currently provide services, but lack the resources to meet the rule’s new burdensome requirements.”

   

Tagged categories: Associated Builders and Contractors; Associated General Contractors; Construction; Contractors; Government contracts; Hiring; Labor; Laws and litigation; Regulations

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