United States Department of Labor
Office of Administrative Law Judges Law Library

NOTICE: THIS INDEX WAS PREPARED BY THE CIVIL RIGHTS DIVISION, OFFICE OF THE SOLICITOR, U.S. DEPARTMENT OF LABOR, FOR INTERNAL USE. IT IS NOT AN OFFICIAL INTERPRETATION OF THE CASES, AND WAS LAST REVISED IN NOVEMBER, 1996.

Return to Table of Topics, 503 Index

Employer is a subcontractor under 41 CFR 60-741.2 because the type of service provided by it is necessary to the performance of the contractor's agreement with the Government, even though this particular subcontractor's service may not be necessary. OFCCP v. Monongahela Railroad Co., 85-OFC-2, ALJ Rec. Dec. and Order Granting Plaintiff's Motion for Summary Judgment, April 2, 1986, slip op. at 4, aff'd, Deputy Under Secretary for Employment Standards, March 11, 1987.

A subcontractor's services must be necessary to the performance of the contractor's Government contract but this does not mean that the subcontractor must supply a certain percentage of the Government contractor's services or supplies. Id. at 5, aff'd, Deputy Under Secretary for Employment Standards, March 11, 1987.

To allow a contractor to circumvent the provisions of [Section 503 of the Rehabilitation Act] by maintaining a subsidiary supplier would be inconsistent with the Act's intent to assure that the government uses its spending power so as to improve employment opportunities for qualified handicapped persons. OFCCP v. Texas Utilities Generating Company, 85-OFC-13, ALJ Rec. Dec., March 2, 1988, slip op. at 3-4; remanded on other grounds, Assistant Secretary for Employment Standards Decision and Order of Remand, August 25, 1994; Consent Decree, April 15, 1996.

The defendant is a covered subcontractor within the meaning of Section 503 because it supplies electrical power exclusively to three service companies, two of which are government contractors, and all four are owned by a single entity. OFCCP v. Texas Utilities Generating Company, 85-OFC-13, ALJ Rec. Dec., March 2, 1988, slip op. at 4; remanded on other grounds, Assistant Secretary for Employment Standards Decision and Order of Remand, August 25, 1994; Consent Decree, April 15, 1996.

The Secretary of Labor agreed with OFCCP that the building owner is a subcontractor because it supplies services necessary to the performance of Defendant's government contracts. 41 CFR § 60-1.4; OFCCP v. Coldwell, Banker and Co., Case No. 78-OFCCP-12, Sec. Dec., August 14, 1987, slip op. At 7-8. Defendant had an obligation to assure that its subcontractors complied with the requirements of Section 503, 41 CFR § 60-741.4(f), and by failing to make efforts to obtain handicapped parking spaces Defendant violated that obligation. OFCCP v. First Federal Savings Bank of Indiana, 91-OFC-23, Secretary of Labor, Amended Final Decision and Order, November 20, 1995, at 5.