Section 503 in 2026: What Changed, What Didn't, and What Contractors Should Do Now

The short version, because a lot of contractors have the wrong impression: nothing has changed yet. The proposal to remove the disability self-identification requirement and the 7% utilization goal has not been finalized. Federal contractors are still required to invite self-identification, still required to use Form CC-305, and still required to maintain the associated recordkeeping.

For a separate commercial perspective on remote workforce management, see the analysis; it should be evaluated independently against accessibility, privacy, and employment-law requirements.

Official contractor guidance is maintained in the OFCCP Section 503 resource.

This is general information, not legal advice. Take advice from counsel experienced in federal contractor compliance.

What was proposed

On July 1, 2025, OFCCP published proposals in the Federal Register to rescind the regulations implementing Executive Order 11246 and to modify the regulations implementing Section 503 of the Rehabilitation Act and VEVRAA. The most significant proposed change to Section 503 would remove the requirement for federal contractors to solicit disability status from applicants and employees, and eliminate the seven percent disability utilization goal.

The proposal would remove three obligations: inviting applicants and employees to voluntarily self-identify their disability status; applying the seven percent utilization goal to each job group — or to the entire workforce for contractors with 100 or fewer employees — and conducting the associated utilization analysis; and using hiring data for applicants with disabilities to evaluate the effectiveness of outreach and recruitment.

Contractors would also no longer be required to perform annual assessments of disability utilization or of outreach effectiveness, and the Section 503 regulations would be revised to stand independently, removing cross-references to Executive Order 11246 procedures.

The reasoning OFCCP gave

Two arguments, and both are worth understanding because they will shape whatever emerges.

On self-identification, the agency cited concerns that the self-identification and utilization goal regulations are inconsistent with the Americans with Disabilities Act, noting that an employer may not, prior to an offer of employment, make any disability-related inquiries — even a job-related one. OFCCP stated that its previous reliance on an EEOC letter permitting the invitation did not reflect a binding view of the EEOC, because the letter reflected the opinion of one legal officer more than ten years ago and was neither issued by a Commissioner nor voted on by the Commission.

On the utilization goal, OFCCP contended that while the Section 503 regulations prohibit quotas, contractors may in practice be induced to use them to meet the goal. The agency also noted that preparing a utilization analysis relies on the job group structure created under the now-rescinded Executive Order 11246.

The second point is partly circular: the proposal to discontinue self-identification means contractors would lack the data needed to conduct utilization analyses at all.

What is expressly kept

This matters and is frequently missed in summaries.

OFCCP expressly retains the outreach, recruitment, and other disability-related obligations that do not depend on disability data collection.

Section 503 itself — the statute — is unchanged. It prohibits federal contractors and subcontractors from discriminating in employment against individuals with disabilities and requires affirmative action in recruitment and employment. A proposed regulatory change does not repeal the statute, and the non-discrimination obligation is not in question.

Where it stands now

The comment period ran through September 2, 2025.

As of mid-2026 the rule has not been finalized. Public comments were 94% opposed, based on an independent analysis of 612 unique submissions.

And then a development that surprised a lot of compliance teams:

On July 16, 2026, OMB — acting through OIRA — approved OFCCP's Section 503 information collection request without change, extending approval of Form CC-305 through July 31, 2029. Form CC-305 is the Voluntary Self-Identification of Disability form federal contractors use under 41 CFR Part 60-741.

The approval also reflects updated burden estimates: OFCCP's projected number of responses rose from roughly 35.1 million to 41.6 million, largely reflecting workforce growth and application volume across the contractor community.

So one arm of the government renewed the form for three more years while another pursues a rule that would eliminate it. That is not as contradictory as it looks — the Paperwork Reduction Act renewal and the rulemaking are separate processes on separate timelines — but the practical consequence is unambiguous.

What contractors must do today

Until a final rule takes effect, federal contractors must continue using Form CC-305 and maintaining the related recordkeeping as currently required.

Concretely, that means continuing to:

• Invite applicants to self-identify pre-offer and post-offer, using the current CC-305
• Survey the existing workforce on the required cycle
• Apply the 7% utilization goal per job group
• Conduct the annual utilization analysis
• Assess outreach and recruitment effectiveness
• Retain records per the existing schedule

Do not dismantle these processes in anticipation. A rule that has not been finalized is not a rule, the comment record ran heavily against it, and rules of this kind are frequently modified between proposal and finalization — or litigated afterwards.

What to do about the uncertainty

Keep complying, and keep the process documented. If the rule is finalized, you stop. If it is not, you never had a gap.

Separate what is mandated from what is useful. A great deal of what contractors built around Section 503 — relationships with vocational rehabilitation agencies, accessible application systems, accommodation processes, manager training — has nothing to do with data collection and is not affected by any of this. Those things produce hires. The utilization analysis, by itself, never did.

Do not treat a possible end to measurement as an end to the objective. The 7% goal was always a measure of good-faith effort rather than a quota with automatic penalties. If it goes away, what disappears is a reporting obligation, not a reason to recruit.

Watch the ADA angle carefully. OFCCP's stated position — that pre-offer invitations to self-identify sit uneasily with the ADA — is contested, and how it is resolved will affect employers who are not federal contractors at all. This is the part of the proposal with the longest reach.

Keep your own numbers, whatever happens. An employer that stops measuring stops knowing. Voluntary internal measurement, properly separated from hiring decisions, remains available and remains informative.

For job seekers

If you are applying to a federal contractor and see Form CC-305, it is still in use and legitimate. Self-identification is voluntary, it is kept confidential, it is separated from the hiring decision, and it is not the same thing as requesting an accommodation.

Whether to disclose is a separate decision with its own considerations. See disclosing a disability: when, to whom, and why.

What we will do here

We will update this page when the rule is finalized, withdrawn, or modified, with the date of the change. Until then, the position above is current as of publication.

If your organization needs certainty on a specific obligation, that is a question for counsel rather than for an article — including this one.