In a move the Agency reported is designed to maintain healthcare access for active and retired service members and their families, the Office of Federal Contract Compliance Programs (OFCCP) has announced a two-year extension to the enforcement moratorium for Veterans Affairs Health Benefits Program (VAHBP) providers. This extension, effective June 11, 2025, will now run through May 7, 2027.

The extended moratorium continues to suspend the enforcement of VAHBP providers’ requirement to take affirmative steps to ensure equal opportunity without regard to disability or protected veteran status, obligations typically required of federal contractors and subcontractors. Additionally, VAHBP providers will not be subject to neutral scheduling for compliance evaluations during this period – though all evaluations are currently being held in abeyance.

Presently, the OFCCP retains authority to investigate discrimination complaints filed under Section 503 of the Rehabilitation Act (Section 503) and the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA). However, given the current administration’s focus on deregulation and the recent proposed budget that would effectively eliminate the OFCCP, this moratorium extension likely reflects the need to address the previous May 2025 expiration date, rather than an indication that the agency is ramping up its activities.

This extension represents the latest in a series of actions dating back to 2014, when the OFCCP first limited its enforcement activities for TRICARE subcontractors in an effort to balance regulatory requirements and veterans’ access to healthcare, allowing for more time to consider stakeholder feedback. The moratorium was later expanded to include VAHBP providers. Effective August 31 2020, OFCCP’s final rule established that it does not have authority over TRICARE providers. The current moratorium extension provides additional time for the OFCCP to develop sub-regulatory guidance specifically addressing VAHBP providers.

While the extension offers some regulatory relief, VAHBP providers must remain aware that the moratorium does not exempt them from nondiscrimination obligations.

We will continue to monitor OFCCP developments and administrative activities for updates. If you have questions about this extension and how it may affect your organization, please contact a Jackson Lewis attorney for guidance.

According to the U.S. Department of Labor’s (DOL) fiscal year 2026 proposed budget, the Department is set to fully eliminate the Office of Federal Contract Compliance Programs (OFCCP) next fiscal year, which begins October 1, 2025. The budget proposal aligns with the current administration’s broader efforts to shut down the OFCCP and its authority to audit and investigate federal contractors for potential race and sex discrimination. Earlier this year, President Trump issued Executive Order (EO) 14173, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” which rescinded Executive Order 11246. Revoking this President Johnson-era order stripped most of the OFCCP’s authority, except where otherwise outlined in statute.

The budget proposal, released on May 30, 2025, states Executive Order 14173

permanently removes the primary basis for OFCCP’s enforcement authority and program work.

The budget proposes transferring OFCCP’s responsibilities under Section 503 of the Rehabilitation Act to the Equal Employment Opportunity Commission (EEOC). Additionally, the DOL’s Veterans’ Employment and Training Service would take over enforcement duties under the Vietnam Era Veterans’ Readjustment Assistance Acts (VEVRAA).

Congress has yet to approve the DOL’s proposed budget, and statutory amendments may be necessary to transfer authority from the OFCCP to other executive agencies.

We will continue to monitor the situation and provide updates as we learn of them.

As projected, the 2024 EEO-1 Data Collection is officially open. The deadline to file the 2024 EEO-1 Component 1 report is Tuesday, June 24, 2025. EEOC notes in its announcement that

[a]s part of the EEOC’s efforts to identify continued cost savings for the American public, there will be a shorter collection period during which filers may submit their 2024 reports. The collection period will not extend beyond the Tuesday, June 24, 2025 “Published Due Date” deadline. 

The announcement also notes “all communications sent to filers will be electronic. No notifications about the 2024 collection will be sent to filers via postal mail.” In past years, EEOC has sent paper notices of non-compliance following closure of the collection period.

In addition to the announcement, EEOC also posted a message from Acting EEOC Chair Andrea Lucas. Acting Chair Lucas reminds filers of their “obligations under Title VII not to take any employment actions based on, or motivated in whole or in part by, an employee’s race, sex, or other protected characteristics.” She reiterates

[t]here is no “diversity” exception to Title VII’s requirements.

Her message also relays the recent Executive Order directive to agencies to deprioritize “disparate impact” enforcement noting “[t]he EEOC is an executive branch agency, not an independent agency. We will fully and robustly comply with this and all Executive Orders. Under my leadership, the EEOC will prioritize remedying intentional discrimination claims.”

In closing, Acting Director Lucas again reminds filers they “must not use the information collected and reported in your organization’s EEO-1 Component 1 report to justify treating employees differently based on their race, sex, or other protected characteristic” and notes the “EEOC remains committed to helping employers comply with their obligations under federal employment antidiscrimination laws.”

We will continue to monitor this story and bring you any additional updates. If you have questions regarding your EEO-1 filing or other compliance needs, please contact the Jackson Lewis attorney with whom you work.

As an update to our previous post, the EEOC’s request for a non-substantive change to remove the option for employers to voluntarily report non-binary data on the EEO-1 data collection has been approved without change.

We are now waiting to see when EEOC will open the 2024 EEO data collection portal. In the proposed instructions filed with the requested change, EEOC indicated May 20, 2025 as the anticipated opening.

We are continuing to monitor the situation and will report back with any updates.

On April 15, 2025, in response to Executive Order 14168, Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government, the EEOC filed an Information Collection Request (ICR) with OMB requesting what it classified as a non-substantive change to remove the option for employers to voluntarily report non-binary data for those in their workforce. 

In past years, the EEO-1 reporting instructions allowed respondents to provide non-binary data in a narrative form in the comment box of the report.  EEOC believes this voluntary option must be removed to comply with Executive Order 14168.

The data collection for 2024 has not yet opened but the proposed instruction booklet filed with the ICR indicates reporting would open May 20, 2025, with a reporting deadline of June 22, 2025.  The ICR is not seeking any changes beyond the current data collection approval period which runs through 2026.

We will continue to monitor and report additional updates as more information becomes available.

Ten former Department of Labor Officials, including former EEOC Commissioner and past OFCCP Director Jenny Yang, sent an open letter to federal contractors responding to President Trump’s issuance of Executive Order 14173 and newly appointed OFCCP Director Catherine Eschbach’s recent statements about OFCCP.

The letter is aimed to

“help federal contractors and other employers navigate this complex environment, providing clarity about their options and obligations under the law.”

The 14-page letter details how the current administration’s actions are in contravention of established law, explains compliance with Executive Order 11246 did not require the unlawful use of preferences or quotas, and describes how continued proactive practices, including self-assessments and data analysis to remove discriminatory barriers remain lawful and are essential to prevent discrimination.

The letter concludes reiterating that “America’s enduring promise is that talent and effort – not background or origin – should determine one’s path” and encourages the federal contracting community to “stand firm in your commitments to lawful diversity, equity, inclusion, and accessibility practices that promote civil rights compliance, true merit, and a strong economy.”

The Wall Street Journal is reporting newly appointed OFCCP Director Catherine Eschbach announced to OFCCP staff that the Agency will review federal contractor affirmative action plans previously submitted to the Agency for evidence of discriminatory employment practices. The report quotes Director Eschbach’s email to staffers in which she states

…most of what OFCCP had been doing was out of step, if not flat out contradictory, to our country’s laws, and all reform options are on the table.”

It is unclear at this time what form these reviews will take or which contractors may be under review.

Importantly, the plans under review were submitted to OFCCP under the prior Executive Order 11246 and before the current administration’s recent issuance of Executive Order 14173, revoking EO11246.

This is a developing story so stay turned for further details.

The U.S. Department of Labor has announced that Catherine Eschbach will be the new Director of OFCCP, taking over for Acting Director Michael Schloss.

Director Eschbach comes from private practice as an Appellate attorney at Morgan Lewis, representing clients in complex matters.  Prior to private practice, Director Eschbach clerked for Judge Jennifer Walker Elrod of the US Court of Appeals for the Fifth Circuit and Judge David Hittner of the US District Court for the Southern District of Texas. 

While it is too early to determine what Director Eschbach’s appointment means for the OFCCP’s future, she is coming into an Agency that is looking for direction.

We look forward to working with Director Eschbach and welcome her to the Agency.

This continues to be a developing story so stay tuned for updates.

President Trump has revoked President Biden’s EO that increased the minimum wage for federal contractor employees. This action is part of a broader effort by Trump to reverse several of Biden’s executive orders, marking a significant shift in federal policy. (Refer to EO “Additional Rescissions of Harmful Executive Orders and Actions.”) Read more.

OFCCP’s website reflects Michael Schloss has been appointed to the Deputy Director for Policy Role within the Agency. Michele Hodge, former Acting Director is listed as Deputy Director while the Director role remains vacant. The Deputy Director for Policy would traditionally act in an Acting Director role in this type of situation. As such, the National Office Directory for OFCCP reflects Schloss will hold both positions. OFCCP has made no official announcement regarding the appointments.

Schloss’s appointment adds to the questions and uncertainty swirling around OFCCP’s current and future state as contractors await notices of audit closures and further direction regarding remaining VEVRAA and Section 503 obligations.

This continues to be a developing story so stay tuned for updates.