AGC Urges Administration to Reconsider Unnecessary Employment Rules for Federal Contractors

The Obama administration should reconsider its proposal to impose oppressive new regulations governing the employment of veterans and people with disabilities on federal contractors, officials with the Associated General Contractors of America argued during a meeting with the administration. Association officials said federal employment and compliance enforcement data indicate there is no justification for the costly new rules.

“As the data makes clear, veterans and the disabled are already extremely well represented in the construction industry,” said Stephen E. Sandherr, the association’s chief executive officer, following a meeting today with the Office of Information and Regulatory Affairs (OIRA). “These new rules offer a very costly fix for a problem that, according to the government’s own data, doesn’t appear to exist.”

The proposed new rules allegedly address “higher unemployment” rates among veterans and the disabled community, according to the Office of Federal Contract Compliance Programs (OFCCP). Yet federal employment data shows that the annual average unemployment rate for all veterans in 2012 was 7 percent, lower than the 7.9 percent rate for nonveterans, while a higher share of employed veterans than nonveterans work in the construction industry. In addition, people with disabilities are as likely to be employed by construction firms as people without disabilities according to the Bureau of Labor Statistics.

Association officials also noted that an analysis conducted by the Center for Corporate Equality of OFCCP’s own enforcement data found almost no indication that veterans or the disabled are being discriminated against by federal contractors. The report, which was based on an exhaustive study of federal compliance reviews and complaint investigations, found that only 0.02 percent of all federal contractors could be seriously suspected of having discriminated against veterans or people with disabilities.

Given the lack of data justifying the need for the rules, and the fact that they will cost significantly more than OFCCP officials suggest, Sandherr urged the Obama administration to reconsider finalizing the new employment mandates for federal contractors. He said the administration should instead re-open the record to determine whether the rules are needed.

“The fact federal officials are sitting down and listening to groups like ours is a hopeful sign the administration is ready to ask tough questions about whether there is any justification to move forward with these new mandates,” Sandherr said. “So far, all available federal data makes it clear that there is simply no need for these new regulations.”