Applies to: All Federal Contractors and Subcontractors
Effective: July 2, 2025
Quick Look
- On July 2, 2025, the U.S. Secretary of Labor Lori Chavez-DeRemer lifted the pause on the Office of Federal Contract Compliance Programs (OFCCP) enforcement actions.
- The effect of the Secretary’s Order 08-2025 is to resume enforcement activity against federal contractors and subcontractors for their compliance with Section 503 of the Rehabilitation Act, which protects individuals with disabilities, and the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA), which protects veterans.
DISCUSSION
On July 2, 2025, the U.S. Secretary of Labor Lori Chavez-DeRemer issued Secretary’s Order 08-2025 lifting the hold on the January 24, 2025 Secretary’s Order 03-2025, previously issued by then-Acting Secretary Vincent Micone, ordering OFCCP to cease and desist investigative and enforcement activity. The instruction is to effect compliance with Executive Order 14173 which ordered OFCCP to immediately cease holding federal contractors responsible for taking affirmative action or allowing workforce balancing based on certain protected classes. Executive Order 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity, revoked Executive Order 11246 which required federal contractors to develop affirmative action plans and prohibited discrimination in employment based on race, color, religion, sex, sexual orientation, gender identity, and national origin by encouraging workforce balancing.
Executive Order 14173 directed federal agencies to eliminate any illegal diversity, equity, and inclusion (DEI) related programs and focus on merit. It specifically excluded contracting preferences for veterans and certain individuals with disabilities. The effect of Secretary’s Order 08-2025 is to resume enforcement activity against federal contractors and subcontractors for their compliance with Section 503 of the Rehabilitation Act, which protects individuals with disabilities, and the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA), which protects veterans. The Secretary’s Order notifies federal contractors and subcontractors of the following actions:
- Section 503 and VEVRAA complaints will immediately resume being processed. Affected parties will be promptly notified.
- OFCCP will administratively close all pending compliance reviews of invalidated Executive Order 11246 requirements.
- The affirmative action program certification period remains closed.
- OFCCP renewed the Veterans Affairs Health Benefits Program (VAHBP) enforcement moratorium until May 7, 2027.
The Secretary’s Order makes clear that OFCCP requirements to comply with Section 503 and VEVRAA remain in effect and contractors should continue to comply.
ACTION ITEMS
- Review Section 503 and VEVRAA compliance obligations with legal counsel.
Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that OneDigital is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2025 OneDigital
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