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Copyright 2023 J. J. Keller & Associate, Inc. For re-use options please contact copyright@jjkeller.com or call 800-558-5011.
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The Rehabilitation Act prohibits discrimination on the basis of disability in programs conducted by Federal agencies, in programs receiving Federal financial assistance, in Federal employment, and in the employment practices of Federal contractors. The standards for determining employment discrimination under the Rehabilitation Act are the same as those used in Title I of the Americans with Disabilities Act. The Rehabilitation Act provides that recipients of Federal financial assistance are prohibited from discriminating against otherwise qualified handicapped persons solely by reason of their handicap. The Rehabilitation Act covers handicapped persons in the Federal government, Federal government programs or an employer who contracts or subcontracts with the Federal government. Regulations pertaining to this type of discrimination can be found at 41 CFR 60-741 (Affirmative action and nondiscrimination obligations of contractors and subcontractors regarding individuals with disabilities).
Section 501 Section 501 requires affirmative action and nondiscrimination in employment by Federal agencies of the executive branch.
Section 503
Section 503 requires affirmative action and prohibits employment discrimination by Federal government contractors and subcontractors with contracts of more than $10,000.
In 1998, Congress amended the Rehabilitation Act and strengthened provisions covering access to information in the federal sector. As amended, Section 503 of the Rehabilitation Act requires employers with federal contracts or subcontracts that exceed $10,000, and contracts or subcontracts for indefinite quantities (unless the purchaser has reason to believe that the cost in any one year will not exceed $10,000), to take affirmative steps to hire, train, and promote qualified individuals with disabilities.
Under Section 503 and its implementing regulations, covered employers with federal contracts or subcontracts must take affirmative steps to employ qualified individuals with disabilities. This obligation covers the full range of employment and personnel practices, such as recruitment, hiring, rates of pay, upgrading, and selection for training. All covered contractors and subcontractors must also include a specific equal opportunity clause in each of their nonexempt contacts and subcontracts. The regulations provide the required language for this clause.
In addition, Section 503 and its regulations require covered federal contractors and subcontractors to make reasonable accommodations for the known physical or mental limitations of qualified individuals with disabilities, unless providing an accommodation would create an undue hardship. Furthermore, covered contractors and subcontractors are required to take all necessary actions to ensure that no one attempts to intimidate or discriminate against any individual for filing a complaint or participating in a proceeding under Section 503.
Under Section 503, each employer that has both (1) a Federal contract or subcontract of $50,000 or more, and (2) 50 or more employees, must prepare, implement, and maintain a written affirmative action program covering each of its establishments. The employer must review and update the program annually and must make it available for inspection by any employee or applicant for employment, as well as by the Office of Federal Contract Compliance Programs (OFCCP). The program may be integrated with, or kept separate from, any other affirmative action program the employer is required to prepare.
Exempt employers
Contracts and subcontracts which are exempt from Section 503 include those:
- Not exceeding $10,000;
- For work that is performed outside the U.S.; and
- With state or local governments, except for the specific government entity that participates in work on or under the contract.
Employer requirements
Covered employers must take affirmative steps to employ qualified individuals with disabilities, including recruitment, hiring, rates of pay, upgrading, and selection for training. All covered contractors and subcontractors must also include a specific equal opportunity clause in each of their nonexempt contracts and subcontracts.
Reasonable accommodation
In addition, covered federal contractors and subcontractors must make reasonable accommodations for the known physical or mental limitations of qualified individuals with disabilities, unless providing an accommodation would create an undue hardship.
“Reasonable accommodation” might be as simple as providing a magnifying screen for a computer monitor, installing a wheelchair ramp, or may be more substantial.
Medical examinations and pre-employment inquiries
It is generally unlawful for the contractor to require pre-offer medical examinations or to make inquiries as to whether an applicant or employee is an individual with a disability or as to the nature or severity of such disability.
The contractor, however, may make pre-employment inquiries into the ability of an applicant to perform job-related functions, and/or may ask an applicant to describe or to demonstrate how, with or without reasonable accommodation, the applicant will be able to perform the duties of the job.
The contractor may also require a medical examination or make an inquiry after making an offer of employment but before the applicant begins his duties, and may condition the employment offer on the results of such examination, if all entering employees into the same job category are subjected to such examination or inquiry. In addition, the contractor may require a medical examination or make an inquiry of an employee if it is job-related and consistent with business necessity.
Retaliation
Covered contractors and subcontractors are required to take all necessary actions to ensure that no one attempts to intimidate or discriminate against any individual for filing a complaint or participating in a proceeding under Section 503.
Affirmative action program
Under Section 503, each employer that has both a federal contract or subcontract of $50,000 or more, and 50 or more employees must prepare, implement, and maintain a written affirmative action program covering each of its establishments.
The employer must review and update the program annually and must make it available for inspection by any employee or applicant for employment, as well as by the Office of Federal Contract Compliance Programs (OFCCP).
Section 503 regulations apply to state and local government entities which have contracts with the federal government if the state or local government entity participates in work on or under the contract or subcontract. Unlike coverage of private sector employers, the government entity but not the government as a whole becomes subject to Section 503 and its regulations when it enters into the contract.
Waivers from Section 503
The Deputy Assistant Secretary may grant a waiver from the requirements of Section 503 in the following circumstances:
For specific contracts, subcontracts or purchase orders, if special circumstances in the national interest require such an exemption:
- For facilities not connected to performance of the federal contract, upon the written request of the contractor, if certain conditions listed in the regulations are met. This type of waiver will terminate, at the very latest, two years after the date on which the waiver is granted, and earlier under certain specific circumstances; and
- 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.
Relation to state, local, and other federal laws
Section 503 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.
Section 107(b) of the Americans With Disabilities Act of 1990 (ADA) required agencies with enforcement responsibilities under the Rehabilitation Act of 1973 (e.g., OFCCP) and under Title I of the ADA (i.e., the Equal Employment Opportunity Commission) to develop procedural regulations to ensure that complaints filed under these laws are addressed in a manner that avoids duplication of effort and prevents application of inconsistent or conflicting standards for the same requirements under the two laws. These regulations are found at 41 CFR Part 60-742.
Filing complaints
Employees of and applicants for employment with a covered contractor or subcontractor have the right to file a complaint with OFCCP if they believe that a Federal contractor or subcontractor has discriminated against them on the basis of a disability. Complaints may be filed with OFCCP within 300 days from the date of the alleged discrimination, unless the time for filing is extended by OFCCP.
Disability discrimination complaints filed with OFCCP are considered charges filed simultaneously under the ADA whenever the complaints also fall within the ADA’s jurisdiction. OFCCP will act as EEOC’s agent in processing the ADA component of the charge. OFCCP will transfer to EEOC all disability discrimination complaints over which it does not, but EEOC may, have jurisdiction. OFCCP will investigate and process all of the Section 503/ADA complaints not transferred to EEOC.
If OFCCP’s investigation reveals a violation, the agency will attempt to conciliate with the contractor, often entering into a conciliation agreement. A conciliation agreement may include a job offer, back pay, reinstatement, promotion or reasonable accommodation.
If the investigation results in a finding of no violation, OFCCP will issue both a finding of no violation and a right-to-sue letter under the ADA, and will close the complaint. Complainants may request a right-to-sue letter earlier in the process.
Penalties/Sanctions
The Office of Federal Contract Compliance Programs (OFCCP) investigates for violations of Section 503 either 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 initiate an administrative enforcement proceeding by issuing an administrative complaint against the contractor or subcontractor.
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 a violation of Section 503 has occurred, it may order the contractor or subcontractor to provide appropriate relief, which may include back pay and benefits, and restoration of employment status, 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.
Section 504
The regulations implementing the employment provisions of the ADA were modeled on the regulations implementing Section 504 of the Rehabilitation Act (34 CFR Part 104). Section 504 states that “no qualified individual with a disability in the United States shall be excluded from, denied the benefits of, or be subjected to discrimination under” any program or activity that either receives Federal financial assistance or is conducted by any Executive agency or the United States Postal Service.
Each Federal agency has its own set of section 504 regulations that apply to its own programs. Agencies that provide Federal financial assistance also have section 504 regulations covering entities that receive Federal aid. Requirements common to these regulations include reasonable accommodation for employees with disabilities; program accessibility; effective communication with people who have hearing or vision disabilities; and accessible new construction and alterations. Section 504 may also be enforced through private lawsuits. It is not necessary to file a complaint with a Federal agency or to receive a “right-to-sue” letter before going to court.
Executive agencies of the U.S. Government are exempt from the ADA, but these agencies are covered by similar nondiscrimination requirements and additional affirmative employment requirements under Section 501 of the Rehabilitation Act of 1973.
Enforcement
The OFCCP ensures that companies doing business with the federal government comply with their contractual obligations to provide equal employment opportunity and to develop positive programs to recruit, hire, and promote qualified individuals with disabilities.
The Department of Labor has jurisdiction of the Rehabilitation Act. The employee can recover compensatory and punitive damages in cases of intentional discrimination. Punitive damages, however, may only be recovered against private sector employers who acted with malice or reckless indifference to the victim’s rights. Damages are limited to $50,000 for employers 15-100, $100,000 from 101-200, $200,000 for 201-500 and $300,000 for 501 or more.
The EEOC enforces sections 501 and 505 of the Rehabilitation Act of 1973 (Pub. L. 93-112) (Rehab. Act), as amended. The text of these sections appear in volume 29 of the United States Code, beginning at section 791. Section 501 prohibits employment discrimination against individuals with disabilities in the federal sector. Section 505 contains provisions governing remedies and attorney’s fees under Section 501.
Relevant definitions that apply to sections 501 and 505 precede these sections. Section 512 of the Americans with Disabilities Act of 1990 (Pub. L. 101-336) (ADA) amends definitions applicable to the Rehab. Act. The Rehabilitation Act Amendments of 1992 (Pub. L. 102-559) further amends the definition of “individual with a disability” and Section 501. In addition, section 102 of the Civil Rights Act of 1991 (Pub. L. 102-166 (CRA) amends the Revised Statutes by adding a new section following section 1977 (42 U.S.C. 1981), to provide for the recovery of compensatory and punitive damages in cases of intentional violations of Title VII, the Americans with Disabilities Act of 1990, and section 501 of the Rehabilitation Act of 1973.
The Access Board
The Architectural and Transportation Barriers Compliance Board, known as the Access Board, is an independent federal agency responsible for issuing and publishing standards setting forth definitions of electronic and information technology, and the technical and functional performance criteria necessary to implement the Act.
The Board also develops and maintains accessibility guidelines for the built environment, transit vehicles, and telecommunications equipment under other laws and enforces design standards for federally funded facilities.
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