Frequently Asked Questions & Glossary


FAQ's

What is Affirmative Action?

Who Is Covered

Are all construction contractors and subcontractors subject to the laws enforced by OFCCP?

We don't do any government work here. Federal Government work is performed in some other division in another state. Are we subject to the equal employment laws enforced by OFCCP?

Our business operates as a fund depository, and an issuing and paying agent for U.S. Saving Bonds and savings notes; therefore, are we required to comply with the Affirmative Actions Program (AAP) obligations under Executive Order (E.O.) 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?

Is a hospital or other health care provider covered under the laws enforced by OFCCP?

Is a financial institution that is covered by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Association (NCUA) with deposit insurance subject to the Affirmative Actions Program (AAP) requirements under 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?

Requirements

When are Federal contractors and subcontractors required to develop a written affirmative action program (AAP) under Executive Order 11246?

As a Prime Contractor, am I required to make sure that the vendors and suppliers with whom I am doing business develop a written AAP?

What does OFCCP look for in a contractor's internal audit and reporting system?

What is the correct procedure for a contractor to obtain the ethnic information of its employees and applicants?

What is a compliance review?

Once a compliance review has been completed, when can our Company expect to be evaluated again?

Does OFCCP offer any guidance about how employers may self-audit their own employment practices to make sure that they comply with the laws enforced by OFCCP?

Overriding Self-Identification

May an employer override an individual's self-identification of race, gender or ethnicity based on the employer's visual observation?

Will OFCCP come out to contractors' facilities and assist them in the development of their AAPs?

Does the government provide or sell publications that explain how to create an Affirmative Action Program?

How do I get the availability statistics for my specific geographic area(s)?

What is the EEO-1 "Job Classification Guide"? Where can contractors find a copy?

What are the EEO-1 and Vets 100 reports and where can information regarding these reports be found?

How can I learn more about OFCCP requirements?

What questions may employers ask on an employment application and what questions are employers prohibited from asking?

What documents are employers required to retain related to the application process?

 

If you do not find the question & answer you are looking for here,
then please contact our expert Affirmative Action team by going to the contacts page.

 

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Employers Group AAP Answers

What is Affirmative Action?
An affirmative action program is a management tool designed to ensure equal employment opportunity, and includes those policies, practices, and procedures that the Company implements to ensure that all qualified applicants and employees are receiving an equal opportunity for recruitment, selection, advancement, training, development, and every other term, condition, and privilege of employment.

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Who Is Covered

Are all construction contractors and subcontractors subject to the laws enforced by OFCCP?
All contractors and subcontractors who hold a Federal or federally-assisted construction contract in excess of $10,000 will be subject to regulatory requirements under one or more of the laws enforced by OFCCP depending upon the amount of the contract. Once it has been determined that a contractor or subcontractor is subject to OFCCP jurisdiction, the regulations implementing the civil rights requirements enforced by OFCCP apply to all of the contractor's or subcontractor's employees who are engaged in on site construction, including those construction employees who work on a non-Federal or non-federally assisted construction site.

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We don't do any government work here. Federal Government work is performed in some other division in another state. Are we subject to the equal employment laws enforced by OFCCP?
Yes. Generally speaking, once it has been determined that a business or organization is subject to the civil rights requirements enforced by OFCCP, all of the business's or organization's establishments or facilities will be subject to the same regulatory requirements, regardless of where the Federal contract is to be performed.

In addition, some businesses or organizations that do not independently hold Government contracts/subcontracts may still be covered under the laws enforced by OFCCP if they are considered a "single entity" with a related business or organization that holds such contracts. In such instances, OFCCP uses a "single entity" test to determine whether the businesses or organizations are so closely related that they may constitute a single entity for purposes of OFCCP jurisdiction. The test requires OFCCP to consider whether:

  • the entities have common ownership;
  • the entities have common directors and/or officers;
  • one entity has de facto day-to-day control over the other through policies, management or supervision of the entity's operations;
  • the personnel policies of the entities emanate from a common or centralized source; and
  • the operations of the entities are dependent on each other, e.g., services are provided principally for the benefit of one entity by another and/or both entities share management, offices, or other services.

The test focuses primarily on whether the ownership, management, and operations of the separate entities are, in fact, sufficiently interrelated to warrant treating them as an integrated enterprise or a single entity. A business or organization need not meet all five factors to be considered a single entity with a covered Federal contractor. However, there is growing recognition that centralized control over labor relations and personnel functions is the most important factor. By way of example, say that two entities are under common ownership, with a common board of directors, and have a central corporate office that determines and issues personnel policy for both entities, and generally manages most personnel-related issues for both entities. At the same time, the operations of the two entities are not particularly dependent on each other. Despite the fact that one of the factors did not apply, the four factors that did outweigh the one that did not, so that the two entities being analyzed will most likely be considered a single entity.

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Our business operates as a fund depository, and an issuing and paying agent for U.S. Saving Bonds and savings notes; therefore, are we required to comply with the Affirmative Actions Program (AAP) obligations under Executive Order (E.O.) 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?
The E.O. 11246 implementing regulations at 41 CFR 60-1.40(a) and 60-2.1(b) state, in relevant part, that any non-construction (Supply and Service) 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.

Under Section 503, 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 non-personal services." 41 CFR 60-741.2(i). The term "non-personal 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."

Under Section 503, however, all government contracts must meet the dollar threshold amount of $50,000 for coverage. Therefore, 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 be obligated to develop and maintain a Section 503 affirmative action program.

The same holds true under 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.

However, the Jobs for Veterans Act (JVA) amended VEVRAA by raising the dollar threshold amount required for contract coverage to $100,000. The new threshold applies to contracts entered on or after December 1, 2003. Accordingly, 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.

For your additional information, there is an interactive electronic tool called the Federal Contract Compliance Advisor, also referred to as Elaws Advisor, to assist Federal contractors and subcontractors in understanding basic coverage and the requirements for compliance with the laws administered by OFCCP. You may wish to consult the Elaws Advisor if you have additional questions about coverage."

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Is a hospital or other health care provider covered under the laws enforced by OFCCP?
A hospital or health care provider may have contracts that provide a basis for coverage under the laws enforced by OFCCP. For example, a hospital may be a covered contractor as a result of a contract with the Department of Veterans' Affairs, The Federal Bureau of Prisons or the Department of Defense requiring the provision of medical services to active or retired military personnel. Likewise, a teaching hospital doing research for a university that has a contract with the Federal government may be a covered Federal contractor.

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Is a financial institution that is covered by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Association (NCUA) with deposit insurance subject to the Affirmative Actions Program (AAP) requirements under 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?
Yes. Financial institutions with federal share and deposit insurance are considered to be government contractors within the meaning of the regulations 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 programs enforced by the Office of Federal Contract Compliance Programs (OFCCP) require equal employment opportunity by government contractors.

The implementing regulations for Executive Order 11246 at 41 CFR 60-1.3 have consistently defined a government contract as any agreement or agreement modification between any contracting agency and any person for the purchase, sale or use of personal property or non-personal services. The term "non-personal services" includes, but is not limited to, the following services: utilities, construction, transportation, research, insurance, and fund depository. This definition thus explicitly includes agreements for insurance.

The implementing regulations for VEVRAA and Section 503, found at 41 CFR 60-250.2, 60-300.2 and 60-741.2, respectively, also define a government contract as any agreement or agreement modification between any contracting agency and any person for the purchase, sale or use of personal property or non-personal services. Like the Executive Order regulations, these regulations also state that the term "non-personal services" includes, but is not limited to the following services: utilities, construction, transportation, research, insurance, and fund depository. Therefore, financial institutions with federal share and deposit insurance are considered to be government contractors.

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Requirements

When are Federal contractors and subcontractors required to develop a written affirmative action program (AAP) under Executive Order 11246?
Each non-construction contractor/subcontractor with 50 or more employees is required to develop a written Affirmative Action Program (AAP) for each of its establishments within 120 days from the start of the Federal contract, if it:

Has a Federal contract or subcontract of $50,000 or more;
Has government bills of lading which in any 12-month period total, or can reasonably be expected to total, $50,000 or more;
Serves as a depository of Federal funds in any amount; or
Is a financial institution that is an issuing and paying agent for U.S. savings bonds and savings notes in any amount.

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As a Prime Contractor, am I required to make sure that the vendors and suppliers with whom I am doing business develop a written AAP?
No. You are not required to ensure that your vendors and suppliers develop and maintain written AAPs. The regulations require that each contractor and subcontractor include the EO clause in each subcontract or purchase order. Whether a vendor or supplier is subject to the written AAP requirements, would depend on, among other things, whether the vendor or supplier has a subcontract that is necessary to the performance of the Government contract, the dollar value of any such subcontract, and the number of employees in the vendor's or supplier's workforce.

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What does OFCCP look for in a contractor's internal audit and reporting system?
The internal audit and reporting system is the contractor's way to assess the overall effectiveness of the contractor's Affirmative Action Program (AAP) and advise senior management of the effectiveness of the AAP. The system should monitor records of all personnel activity (including hires, promotions, transfers and terminations) and compensation at all levels to ensure that non-discriminatory practices have been followed. It is suggested that reporting be performed on a periodic basis and reviewed by appropriate management. In addition, top officials should be notified of the program's effectiveness and any recommendations for improvement. The AAP should contain a narrative description of how the system works.

Some larger contractor establishments may find it necessary and helpful to conduct internal audits and reports more frequently (i.e., quarterly), while smaller contractors may find that an annual review is sufficient. Our regulations only require "periodic" reviews, which OFCCP has historically considered to mean at least once per AAP year.

OFCCP is working on providing self-audit guidance for contractors to enhance their internal audit procedures.

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What is the correct procedure for a contractor to obtain the ethnic information of its employees and applicants?
OFCCP regulations 41 CFR 60-1.12(c) indicate that for any personnel or employment record a contractor maintains, it must be able to identify the gender, race, and ethnicity of each employee and, where possible, the gender, race and ethnicity of each applicant.

OFCCP has not mandated a particular method of collecting the information. Self-identification is the most reliable method and preferred method for compiling information about a person's gender, race and ethnicity. Contractors are strongly encouraged to rely on employee self-identification to obtain this information. Visual observation is an acceptable method for identifying demographic data, although it may not be reliable in every instance. If self-identification is not feasible, post-employment records or visual observation may be used to obtain this information. Contractors should not guess or assume the gender, race or ethnicity of an applicant or employee.

A contractor's invitation to an employee or applicant to self-identify his or her gender, race, and ethnicity should indicate to individuals that supplying such information is voluntary. OFCCP would not hold a contractor responsible for applicant data when the applicant declines to self-identify and there are no other acceptable methods of obtaining this information.

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What is a compliance review?
OFCCP conducts compliance reviews of Federal contractors to ascertain their compliance with equal opportunity and non-discrimination requirements.

Compliance review — a comprehensive analysis and evaluation of each aspect of hiring and employment practices, policies and conditions, including such things as hiring, training, employment benefits, promotion, etc. This particular review begins with a desk audit which is a review of the Affirmative Action Plan (AAP) and supporting documentation; and it may also include an on-site review, conducted at the contractor's establishment, to investigate problem areas identified during the desk audit.

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Once a compliance review has been completed, when can our Company expect to be evaluated again?
It is OFCCP's policy not to revisit an establishment within 24 months after the completion of a compliance review.

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Does OFCCP offer any guidance about how employers may self-audit their own employment practices to make sure that they comply with the laws enforced by OFCCP?
OFCCP has published a technical assistance guide for construction contractors, and has published the Federal Contract Compliance Manual (FCCM). Both have sections that address techniques for performing contractor self audits. The FCCM is available on the OFCCP web site. They are working on a new technical assistance guide and other compliance assistance materials that will provide additional guidance on performing self audits of a variety of personnel practices. OFCCP offers compliance assistance seminars on how to self audit as well. You can find a regional calendar of compliance assistance seminars on our web site.

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Overriding Self-Identification

May an employer override an individual's self-identification of race, gender or ethnicity based on the employer's visual observation?
No. OFCCP's policy is that deference should be given to an individual's self-identification and it should not be questioned or overridden by an employer based on the employer's visual observation.

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Will OFCCP come out to contractors' facilities and assist them in the development of their AAPs?
Generally, OFCCP does not come out to contractor facilities. However, OFCCP conducts numerous compliance assistance seminars and other activities that include assistance on developing AAPs. Contractors can find a calendar of compliance assistance seminars. You may also contact the nearest OFCCP District Office for additional information.

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Does the government provide or sell publications that explain how to create an Affirmative Action Program?
OFCCP does not sell publications nor do the regulations require contractors to use any specific format in the development of their AAPs. However, OFCCP regulations 41 CFR Parts 60-2, 60-250 and 60-741 outline the specific content requirement for AAPs under each program. As part of its compliance assistance initiative OFCCP has posted a sample AAP on its website, which contractors should find helpful. Also, Federal contractors may contact the local District Office to make a compliance assistance appointment and/or learn about the periodic seminars that these offices conduct which are designed to share compliance assistance information with contractors and keep them informed of the latest OFCCP developments. Information on how to contact your local OFCCP District Office is located on the on our website.

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How do I get the availability statistics for my specific geographic area(s)?
One of the requirements of an affirmative action program is determining availability of qualified minorities or women for jobs in the contractor's workforce. Availability is defined as "an estimate of the number of qualified minorities or women available for employment in a given job group, expressed as a percentage of all qualified persons available for employment in the job group." 41 CFR 60-2.14 (a). "The purpose of the availability determination is to establish a benchmark against which the demographic composition of the contractor's incumbent workforce can be compared in order to determine whether barriers to equal employment opportunity may exist within particular job groups."

OFCCP regulations further provide that "[t]he contractor must use the most current and discrete statistical information available to derive availability figures." 41 CFR 60-2.14 (d). "Examples of such information include census data, data from local job service offices, and data from colleges or other training institutions." Contractors frequently use U.S. Census Bureau data to determine availability and OFCCP relies on Census data to assess whether a contractor's availability determination is reasonable.

The Census Bureau's Web site presents data on race and ethnicity, cross-tabulated by other variables such as detailed occupations, occupational groups, gender, worksite geography, residence geography, education, age, and industry to determine availability.

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What is the EEO-1 "Job Classification Guide"? Where can contractors find a copy?
The EEO-1 Job classification guide, published in 1996, is a pamphlet provided by the Equal Employment Opportunity Commission (EEOC) to assist employers in the correct assignment of employees according to the nine (9) EEO-1 categories. The current "Job Classification Guide" for the EEO-1 report can be found by accessing the website for the EEOC.

What are the EEO-1 and Vets 100 reports and where can information regarding these reports be found?
An Employment Information Report (EEO-1), also known as a Standard Form 100, is filed annually with the EEO-1 Joint Reporting Committee and provides a demographic breakdown of the employer's work force by race and gender. Standard Form 100 must be filed by covered Federal contractors who:  

  • have 50 or more employees, and
  • are prime contractors or first-tier subcontractors, and
  • have a contract, subcontract, or purchase order amounting to $50,000 or more; or
  • serve as a depository of Government funds in any amount, or is a financial institution which is an issuing and paying agent for U.S. Savings Bonds and Notes. The Federal Contractor Veterans' Employment Report (VETS-100) provides data on the number of veteran employees in the contractor's workforce by job category, hiring location, the number of new hires (veterans and non-veterans), and the maximum and minimum number of employees, among other things. The report must be filed by any Federal contractor or subcontractor who entered into a covered contract(s) or subcontract(s) before December 1, 2003 for at least $25,000 or more. The Jobs for Veterans Act changed the threshold for this requirement from $25,000 to $100,000 for all covered contracts and subcontracts entered into on or after December 1, 2003.

For additional information, individuals are encouraged to visit the following websites for the: EEO-1 Report and VETS 100 Reports.

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How can I learn more about OFCCP requirements?
Upon request the Employers Group AAP team will send you an RFI (request for information) designed to educate you on our AAP program. To request an RFI please contact the Employers Group at 800-748-8484 (Helpline) and request Affirmative Action assistance.

In addition, we recommend that you attend a seminar conducted by your local OFCCP office to obtain answers to any questions and receive one-on-one compliance assistance. OFCCP is committed to providing compliance assistance to all Federal contractors. Compliance assistance can be provided in a variety of ways, e.g., training seminars for individuals or groups, printed brochures and pamphlets, web-based information and tools, telephone consultations, and on-site consultations

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What questions may employers ask on an employment application and what questions are employers prohibited from asking?
Note that this answer is limited to the laws enforced by the Office of Federal Contract Compliance Programs (OFCCP). OFCCP is responsible for enforcing Executive Order 11246, Section 503 of the Rehabilitation Act of 1973 (Section 503), and the Vietnam Era Veterans' Readjustment Assistance Act of 1973 (VEVRAA). Together, these laws prohibit covered federal contractors and subcontractors from discriminating on the basis of race, color, religion, sex, national origin, and status as an individual with a disability or protected veteran and require that affirmative steps be taken to ensure equal employment opportunity in employment practices.

It is the general rule that employers are given wide latitude in questions that they may ask an applicant and are not expressly prohibited from asking questions about race, color, religion, sex, or national origin. However, the employer may not use the information obtained in the application process to unlawfully discriminate against an applicant or employee. It is, therefore, prudent both to avoid asking for information that will not be used in evaluating an applicant's qualifications and to determine ahead of time whether the requested information would be used in a lawful manner. Since it is illegal to make employment decisions on the basis of race, color, religion, sex or national origin, asking questions related to these protected statuses is not advised.

In addition, Section 503 and VEVRAA prohibit employers from asking applicants disability-related questions (i.e., questions that are likely to elicit information about a disability) and from conducting medical examinations of applicants until after a conditional job offer is made. This ensures that an applicant's possible hidden disability will not be considered prior to the employer evaluating the applicant's non-medical qualifications. Once a conditional job offer is made, the employer may ask disability-related questions and require medical examinations, regardless of whether they are related to the job, as long as this is done for all entering employees. However, if an individual is screened out because of a disability, the employer must show that the exclusionary criterion is job-related and consistent with business necessity. Once an employee begins employment, an employer's ability to make disability-related inquiries and require medical examinations is limited. Such inquiries generally may be made or medical examinations required only if they are job-related and consistent with business necessity.

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What documents are employers required to retain related to the application process?
With regard to recordkeeping responsibilities, OFCCP regulations require that federal contractors maintain for a period of two years from the making of the record or the personnel action, all job postings and advertisements, applications received, any interview notes, test and test results, records of job offers, and the applications themselves. Contractors with fewer than 150 employees or a contract of less than $150,000 need only keep these records for a period of one year. See 41 CFR 60-1.12(a). In addition, OFCCP regulations and the Uniform Guidelines on Employee Selection Procedures (UGESP) obligate covered federal contractors to compile and maintain applicant data in order to ensure that the selection process used during hiring does not result in discrimination against a particular protected group. See 41 CFR 60-1.12, 41 CFR 60-3.4, and 60-3.15. Accordingly, a contractor must be able to identify the race, gender, and ethnicity (Hispanic or non-Hispanic) status of all applicants. Self-identification is the most reliable method and the preferred method for compiling such information about an individual. Contractors are encouraged to use tear-off sheets, post cards, or short forms to request demographic information from applicants that can be maintained separate and apart from the applications themselves. For more information on how to comply with OFCCP's regulations regarding the collection of race, gender, and ethnicity data, see OFCCP's directive entitled "Contractor Data Tracking Responsibilities" dated April 21, 2004. Note that OFCCP is currently engaged in rulemaking to address recordkeeping requirements regarding internet applicants and has issued a proposed rule. See Obligation to Solicit Race and Gender Data for Agency Enforcement Purposes, 69 Fed. Reg. 16446 (March 29, 2004), which can be found on-line. In addition, the agencies that issued the UGESP (including the Department of Labor) also published proposed guidance regarding recordkeeping and internet applicants. See Agency Information Collection Activities: Adoption of Additional Questions and Answers to Clarify and Provide a Common Interpretation of the Uniform Guidelines on Employee Selection Procedures as They Relate to the Internet and Related Technologies, 69 Fed. Reg. 10152 (March 4, 2004), which can be found at the Government Printing Office's website. http://edocket.access.gpo.gov/2004/04-4090.htm.

In addition to the requirement to collect demographic data for applicants, the regulations implementing Section 503 require employers to invite individuals to self-identify so that they can take advantage of the company's Affirmative Action Program for individuals with disabilities. For the same reasons that disability-related questions may not be asked prior to extending a job offer, the invitation to self identify must be given after an individual is made a job offer, but prior to the individual starting work. For more information regarding the invitation to self identify and when the invitation must be made, see 41 CFR 60-741.42. Note that similar regulations exist under VEVRAA governing when employers may invite disabled veterans to self identify. See 41 CFR 60-250.42, available on-line.

In addition, VEVRAA requires that contractors invite applicants to self identify as a protected veteran regardless of whether s/he has a disability. Such invitation may be done at any time before the applicant begins employment.

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