Employment Law Guide
Chapter: Employment Discrimination and Equal Opportunity in Supply & Service
Updated: September 2005
Executive Order 11246, as
amended (Parts II, III, and IV)
(41 CFR Parts 60-1,
60-2, 60-3, 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
Contracts covered by the Executive Order and regulations may be for the
purchase, sale, or use of personal property, nonpersonal services, or both. In
this context, the term "personal property" includes supplies and contracts for
the use of real property, such as lease arrangements, unless the contract for
the use of real property is itself considered real property (such as
with easements). The term "nonpersonal services" includes services such as
utilities, construction, transportation, research, insurance, and fund
depository. Agreements in which the parties stand in the relationship of
employer and employee are not covered.
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 U.S.
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 (ESA); and
- Contracts and 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 requires covered contractors and subcontractors to
refrain from discrimination and to engage in affirmative steps to ensure that
applicants and employees receive equal employment opportunity regardless of
race, color, religion, sex, and/or national origin. Sexual harassment is a
violation of the Executive Order.
The Order requires all covered contractors and subcontractors to 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
The Department of Labor's regulations prohibit discrimination in such
employment practices as recruitment, rates of pay, upgrading, layoff,
promotion, and selection for training. Employers may not make distinctions
based on race, color, religion, sex, or national origin in recruitment or
advertising efforts, employment opportunities, wages, hours, job
classifications, seniority, retirement ages, or job fringe benefits such as
employer contributions to company pension or insurance plans. The regulations
include other requirements, such as those summarized below.
Nonconstruction (supply and service) contractors and subcontractors that
employ 50 or more persons and that also satisfy at least one of four additional
criteria (e.g., having a federal contract of $50,000 or more) must develop
written affirmative action programs (AAPs). Usually an AAP must cover each of
the contractor's establishments.
If a contractor wishes to establish an AAP other than by establishment,
the contractor may reach agreement with OFCCP on the development and use of
functional AAPs, which are organized along functional or business lines. The
AAP is a management tool designed to encourage equal employment
In general, the AAP will describe the policies, practices, and procedures
that the contractor or subcontractor uses to ensure that all qualified
applicants and employees receive equal opportunities for employment and
advancement. If the contractor or subcontractor is not employing women or
minorities at a rate to be expected given their availability in the relevant
labor pool, the AAP will include specific practical steps to address the issue.
Contractors with AAPs must implement them, keep them on file, and update them
annually. Additional information on AAPs may be found on the ESA's Government Contractors,
Affirmative Action Requirements Final Rule Web page.
Covered contractors and subcontractors, regardless of company size, may
not use 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
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 on the
Equal Employment Opportunity Commission’s Facts About Pregnancy Discrimination Web page.
All covered contractors and subcontractors must also provide equal fringe
benefits, and make equal contributions for such benefits for men and women.
Moreover, employers 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
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 your
local OFCCP office. 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 through
compliance evaluations or in response to complaints. If a violation is found,
OFCCP may ask the federal contractor or subcontractor to enter into
conciliation negotiations. If conciliation efforts fail, OFCCP may, through its
attorneys, (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, debarment, and/or
If the contractor or subcontractor is dissatisfied
with the Board's decision, it may appeal that decision to the federal
OFCCP generally refers individual complaints alleging discrimination
based on race, color, religion, sex, or national origin to the
Employment Opportunity Commission for investigation and resolution.
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 private sector employers.
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).