FDIC Financial institutions are considered to be government contractors and subject to implementing Executive Order 11246, as amended, the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA), as amended, 38 U.S.C. 4212 and Section 503 of the Rehabilitation Act of 1973 (Section 503), as amended. These three OFCCP programs require equal employment opportunity by government contractors.

The regulations for Executive Order 11246 (41 CFR 60-1.3), define a government contract as any agreement or modification between any contracting agency and any person for the purchase, sale or use of personal property or nonpersonal services. The term “nonpersonal services” as used in this section includes, but is not limited to, the following services: utilities, construction, transportation, research, insurance, and fund depository. The definition includes agreements for insurance: http://www.dol.gov/dol/allcfr/ESA/Title_41/Part_60-1/41CFR60-1.3.htm.

The implementing regulations for the VEVRAA and Section 503 programs, 41 CFR 60-250.2 (http://www.dol.gov/dol/allcfr/ESA/Title_41/Part_60-250/41CFR60-250.2.htm) and 60-741.2 (http://www.dol.gov/dol/allcfr/ESA/Title_41/Part_60-741/41CFR60-741.2.htm) respectively, also define a government contract as any agreement or modification thereof between any contracting agency and any person for the purchase, sale or use of personal property or nonpersonal services. The term “nonpersonal services” as used in this section includes, but is not limited to, the following services: utilities, construction, transportation, research, insurance, and fund depository. This definition also includes agreements for insurance. Thus, financial institutions with federal share and deposit insurance are considered to be government contractors.

Hospitals can receive reimbursements for medical services provided to federal employees, retirees, or their dependents from a health insurance carrier that participates in the Federal Employee Health Benefits Program (FEHB).

OFCCP’s policy is that the receipt of reimbursements from a health insurance carrier that provides a health benefits plan under the FEHB Program, for the medical services provided to Federal employees or their dependents, will not subject the health care provider to the laws enforced by OFCCP. This policy is based on the decision of DOL’s Administrative Review Board (ARB) in OFCCP v. Bridgeport Hospital, ARB Case No. 00-234, (January 31, 2003).

The E.O. 11246 implementing regulations at 41 CFR 60-1.40(a) and 60-2.1(b) state, that any non-construction contractor that serves as a depository of government funds in any amount or a financial institution which is an issuing and paying agent for U.S. saving bonds and saving notes in any amount must develop an affirmative action program: http://www.dol.gov/dol/allcfr/ESA/Title_41/Part_60-1/41CFR60-1.40.htm.

Section 503 states a government contractor with 50 or more employees and a government contract of $50,000 or more must develop a Section 503 affirmative action program. 41 CFR 60-741.40(a). The Section 503 regulations define a Government contract as “any agreement or modification thereof between any contracting agency and any person for the purchase, sale or use of personal property or nonpersonal services.” 41 CFR 60-741.2(i). The term “nonpersonal services” as used in this section includes fund depository. 41 CFR 60-741.2(i)(4). Thus, the agreement to serve as a Federal funds depository is a “Government contract.” See http://www.dol.gov/dol/allcfr/ESA/Title_41/Part_60-741/41CFR60-741.2.htm.

Under Section 503, however, all government contracts must exceed the $50,000 for coverage. Thus, if you serve as a depository for Federal funds of $50,000 or more, or have an agreement valued at $50,000 or more to be an issuing and paying agent for savings bonds and notes, you would therefore need to develop and maintain a Section 503 affirmative action program.

In addition, it is the same case for VEVRAA as under Section 503 for any Government contractor with 50 or more employees and a contract of $50,000 or more to serve as a depository of Federal funds or as an issuing and paying agent for savings bonds and notes, if the Government contract was entered into before December 1, 2003. See http://www.dol.gov/dol/allcfr/ESA/Title_41/Part_60-250/41CFR60-250.40.htm.

The Jobs for Veterans Act (JVA) amended VEVRAA, however, raise the dollar threshold amount required for contract coverage to $100,000. The new amount applies to contracts entered on or after December 1, 2003. Thus, if your business or organization became a fund depository or an issuing and paying agent for savings bonds and notes on or after December 1, 2003, it would also be subject to the written AAP requirement under VEVRAA if the contract is for $100,000 or more.

Federal contractors or subcontractors are required to maintain employment records for two years from the record date or the action involved, whichever occurs later. Some examples are:

• • Job descriptions
• • Job postings
• • Job offers
• • Applications and resumes
• • Interview notes
• • Tests and test results
• • Physical examination records
• • Employment policies and procedures
• • Personnel files

Contractors with less than 150 employees, or those who do not have a government contract of at least $150,000 only need to keep records for one year from the record date or the action involved, whichever occurs later.

Yes. In general, once a determination has been made on civil rights requirements for a business, then all of the organization’s establishments and facilities will be subject to the regulations, regardless of federal contract location.

In addition, a Single Entity Test will determine entities that may have a close enough relationship to a business to still fall under OFCCP jurisdiction. The test addresses matters such as:

• • Common ownership
• • Common directors and/or officers
• • One entity has daily control over policies, management or supervision of the other entity’s operations
• • The personnel policies of the entities coming from a common source
• • The operations of the entities are dependent on each other

A business or organization does not have to meet all five factors to be considered a single entity.

You are not required to determine if vendors or suppliers have developed and maintained written AAPs. You are however, required to include the Equal Opportunity (EO) clause in each subcontract or purchase order.

Contractors and subcontractors who have federal or federally-assisted contracts of $10,000.00 or more are subject to OFCCP laws depending on contract amount. After the determination of OFCCP jurisdiction has been made, the OFCCP civil rights requirements will apply to all of the contractor’s or subcontractor’s employees on the construction site.

Section 503 of the Rehabilitation Act of 1973, as amended, 29 U.S.C. 793

(http://www4.law.cornell.edu/uscode/29/793.html), is administered by OFCCP. Section 503 requires employers with federal contracts or subcontracts that are greater than $10,000, and contracts or subcontracts for indefinite quantities (unless it is believed the cost in any one year will not be greater than$10,000), to take affirmative steps.

The following types of contracts and subcontracts are exempt from Section 503:

• • For contracts not greater than $10,000
• • For work that is performed outside the U.S.
• • For state or local government contracts

OFCCP civil rights requirements apply to businesses that have:

• • A federal contract, subcontract or a federally assisted construction contract in excess of $10,000.00
• • Federal contract(s) that exceed $10,000.00 in any 12-month period
• • Government bills of lading, is an entity serving as a depository of federal funds, or is an agent that issues and pays for U.S. savings bonds, and notes of any amount that fall under one or more OFCCP laws. (41 CFR Sec. 60-1.5(a), 41 CFR Sec. 60-250.4, and 41 CFR Sec. 60-741.4.)

Please note that the dollar amount and nature of the federal contracts will determine the OFCCP obligations. In general, all of a business’ establishments will be under OFCCP jurisdiction, even if the contract will be exercised at only one of the business’ facilities.

Single Entity Test: To determine if a separate business without government contracts is still subject to OFCCP jurisdiction based on a relationship, the following test is available: http://www.dol.gov/elaws/esa/ofccp/single_entity_test.asp

Subcontractor Test: To determine if a subcontractor is subject to OFCCP jurisdiction, the following test is available http://www.dol.gov/elaws/esa/ofccp/subcontractor_test.asp