Construction trade group loses appeal on Labor Department disability rules

The federal appeals court in the District of Columbia has refused to agree with a construction trade group's objections to U.S. Department of Labor regulations that call for strengthening affirmative action programs to hire disabled workers, labeling the group's challenge “arbitrary and capricious.”

In 2013, the Labor Department issued final regulations that update Section 503 of the Rehabilitation Act of 1973. The new regulations detail specific actions federal contractors and subcontractors must take in the recruitment, training, record-keeping and policy dissemination for hiring disabled workers.

The rule also calls for setting a goal of hiring people with disabilities to be equal to 7% of each job group of their workforces.

The Washington-based Associated Builders and Contractors Inc. trade group objected to a provision of the rule that invites not just individuals who are offered jobs but also job applicants to advise contractors whether they believe they are covered by the Rehabilitation Act, saying that it exceeds the department's regulatory authority. The group also objects to the 7% hiring goal.

In its ruling last week, a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit unanimously upheld a ruling by the U.S. District Court for the District of Columbia that dismissed the case, Associated Builders and Contractors Inc. v. Patricia A. Siu et al.

In discussing the issue of inviting job applicants to identify themselves as disabled, the ruling says that to prevail, the group must show that the rehabilitation statute “unambiguously forecloses” the interpretation of the law offered by the Department of Labor's Office of Federal Contract Compliance Programs.

The association “argues that the word 'qualified' as used in Section 503 — 'take affirmative action to employ and advance in employment qualified individuals with disabilities' — expressly limits affirmative action to individuals already offered jobs. But that word does no such thing. It does not modify 'affirmative action' nor does anything in Section 503 limit 'affirmative action' to those offered jobs,” says the ruling.

“Judicial review exists to ensure that agency actions are the 'product of reasoned decision-making,' ” it says, in quoting an earlier ruling. “Here, (Associated Builders) points to nothing in the rulemaking that suggests OFCCP flunked this highly deferential standard,” says the appeals ruling in affirming the lower court's dismissal.