Employment Law Guide
Chapter: Employment Discrimination in Construction Contracts
Updated: September 2005
Executive Order 11246, as
amended (Parts II, III, and IV)
Parts 60-1, 60-3, 60-4, 60-20, and 60-50)
Executive Order 11246 and its implementing regulations cover employers
with federal contracts or subcontracts that exceed $10,000, or that will (or
can reasonably be expected to) accumulate to more than $10,000 in any 12-month
Covered contracts may be for the purchase, sale, or use of personal
property, nonpersonal services, or both. In this context, the term "nonpersonal
services" includes services such as construction. Agreements where the parties
stand in the relationship of employer and employee are not covered.
In addition, the Executive Order and the regulations cover contractors
and subcontractors who hold any federally assisted construction contract in
excess of $10,000. Under Section III of the Executive Order, in all contracts
for construction to be financed wholly or partially by federal financial
assistance, all applicants for federal financial assistance must include a
specific clause notifying the construction contractor that it is covered by the
Executive Order. All applicants must also agree to cooperate with the Secretary
of Labor in enforcing the Order.
The following types of contracts and subcontracts are exempt from
the Executive Order:
- Those not exceeding $10,000;
- Those for indefinite quantities, unless the purchaser has reason to
believe that the cost in any one year will be over $10,000; and
- Those for work that is performed outside the U.S. by employees who
were not recruited in the United States.
Specific exemptions may apply to the following:
- Contracts and subcontracts with certain religiously-oriented
- Contracts and subcontracts for work on or near Indian reservations;
- Contracts and subcontracts involving national security, if the head
of the contracting agency determines both that (1) the contract is essential to
national security, and (2) noncompliance with a particular requirement of the
Executive Order or the regulations with respect to the process of awarding the
contract is essential to national security;
- Specific contracts or subcontracts, if the Deputy Assistant Secretary
decides that special circumstances in the national interest require such an
- Contractor facilities not related to contract performance, as
determined by the Office of Federal Contract Compliance Programs (OFCCP) within the Department of Labor’s Employment Standards Administration; and
- Contracts or subcontracts with state or local governments, except for
the specific government entity that participates in work on or under the
Moreover, contractors or subcontractors that are religious entities may
grant employment preferences to individuals of a particular religion to perform
work connected with carrying out the activities of the religious entity.
The Executive Order and the regulations require covered contractors and
subcontractors to refrain from discrimination and take affirmative steps to
ensure that applicants and employees receive equal employment opportunity
regardless of race, color, religion, sex, and/or national origin.
Covered contractors and subcontractors must make good faith efforts to
achieve goals set by OFCCP for the employment of women and minorities in all
crafts and trades in their area. These contractors and subcontractors must
pursue such goals on all their construction work, whether or not federal or
federally assisted. They must also include a specific equal opportunity clause
in each of their nonexempt contracts and subcontracts. The Order and the
regulations provide the required
language for this clause.
Although they are not required to create written affirmative action
programs (AAPs), construction contractors and subcontractors must follow the
regulations that require federal and federally assisted construction
contractors and subcontractors to take specific affirmative steps to ensure
equal employment opportunity. Contractors and subcontractors must also fully
document their affirmative action efforts.
All construction contractors and subcontractors, whether or not
federally assisted, are prohibited from discrimination based on race, color,
religion, sex, and national origin in such employment practices as recruitment,
rates of pay, hours, upgrading, layoff, promotion, selection for training,
advertising efforts, job classifications, seniority, retirement ages, or job
fringe benefits such as employer contributions to company pension or insurance
plans. Sexual harassment is also a violation of the nondiscrimination
provisions of the Executive Order.
The regulations also include other specific requirements, such as those
- Covered contractors and subcontractors, regardless of company size,
are barred from using exclusionary policies that treat men and women
differently. For example, a contractor or subcontractor that hires or promotes
a man who has young children cannot deny a job or a promotion to a woman
because she has young children.
- Covered contractors and subcontractors also may not depend on state
"protective" laws to deny employment to qualified female applicants. Such
"protective" laws include those prohibiting women from performing certain types
of occupations, from working more than a certain number of hours, or from
lifting more than a certain amount of weight.
- Covered contractors and subcontractors that qualify as "employers"
under Title VII of the Civil Rights Act of 1964 are required to comply with the
Pregnancy Discrimination Act of 1978. Additional information on this law may be
found at the
Equal Employment Opportunity Commission’s Facts About Pregnancy Discrimination Web page.
Such employers must also provide equal fringe benefits, and make equal
contributions for such benefits, for men and women.
- Covered contractors and subcontractors are required to take all
necessary actions to ensure that no one attempts to intimidate or discriminate
against an individual for filing a complaint or participating in a proceeding
under the Executive Order.
Anyone has the right to file a complaint with OFCCP if he or she
believes that a federal contractor or subcontractor has discriminated on the
basis of race, color, religion, sex, or national origin. In most cases,
complaints must be filed within 180 days of the discriminatory action. Anyone
may call OFCCP with a question about interpreting the regulations, filing a
complaint, or any other related matter.
The main telephone numbers for OFCCP's national offices are 202-693-0101
and 202-693-1308 (TTY). Additional telephone numbers for OFCCP may be found at
OFCCP’s Office Contact Web page.
More detailed compliance assistance information, including copies of explanatory brochures and
regulatory and interpretative materials, may be obtained from the
OFCCP Web site or by contacting
OFCCPs local offices. Further assistance
is available from the OFCCP’s Toll-Free Help Desk at 1-800-397-6251.
OFCCP investigates for violations of the Executive Order either through
compliance evaluations or in response to complaints. If a violation is found,
OFCCP may ask the contractor or subcontractor to enter into conciliation
negotiations. If conciliation efforts fail, OFCCP may (1) initiate an
administrative enforcement proceeding by filing an administrative complaint
against the contractor, or (2) refer the matter to the Department of Justice
for action by the Attorney General.
If OFCCP files an administrative complaint, the contractor or
subcontractor has 20 days to request a review by an Administrative Law Judge
(ALJ), who hears the case and recommends a decision. If the contractor or
subcontractor is dissatisfied with the ALJ's decision, it may appeal the
decision to the Department of Labor's Administrative Review Board. The Board
issues the final decision, whether or not there is an appeal.
If the Board finds that the contractor or subcontractor has violated the
Executive Order, it may order the contractor or subcontractor to provide
appropriate relief, which may include restoration of back pay and employment
status and benefits for the victim(s) of discrimination. Depending on the
circumstances, violations also may result in cancellation, suspension, or
termination of contracts, withholding of progress payments, and debarment.
If the contractor or subcontractor is dissatisfied with the Board's
decision, it may appeal that decision to the federal courts.
OFCCP generally refers individual complaints alleging discrimination
based on race, color, religion, sex, or national origin to the
Employment Opportunity Commission.
The Executive Order and its implementing regulations apply only to the
specific state or local government entities that participate in work on or
under a federal contract or subcontract. This coverage is narrower than that
which applies to employers in the private sector.
The Employment Law Guide is offered as a public resource. It
does not create new legal obligations and it is not a substitute for the U.S.
Code, Federal Register, and Code of Federal Regulations as the official sources
of applicable law. Every effort has been made to ensure that the information
provided is complete and accurate as of the time of publication, and this will
continue. Later versions of this Guide will be offered at
www.dol.gov/compliance or by calling our Toll-Free
Help Line at 1-866-4-USA-DOL (1-866-487-2365).