Affirmative Action Plan: Who Still Needs One

If you searched this term and landed on an article explaining job group analyses, availability analyses, and placement goals, you were reading something written before January 2025 that nobody updated. The rule behind all of that was revoked, and a great many guides and plan templates have carried on as though it were still there.

The correction is narrower than the noise suggests. One presidential order went away. Two acts of Congress did not, and those two carry their own written plan obligations, thresholds, and audit exposure. A contractor that concluded in early 2025 that affirmative action planning was finished made a mistake that is still sitting in its files.

This covers what was revoked, what survived and why, which contractors still have to write a plan, what goes in the two surviving programs, and what a small business with no federal contract needs to do, which is usually nothing. I build the people and records tooling for businesses without an HR department at FirstHR. This is general information rather than legal advice, and the position has changed recently and may change again.

What an Affirmative Action Plan Actually Is

An affirmative action plan is a written compliance document that a covered federal contractor prepares for each establishment, updates every year, and hands to a federal investigator on request. It sets out how the contractor will recruit, hire, and advance people in a specified protected group, what it measured, and what it found.

Three features matter more than the rest. It is written, so an intention never typed up is not a plan. It is annual, so it goes stale on a schedule. And it is producible on demand, which means the version existing on the day the request arrives is the only one that counts. What it is not, and never was, is a hiring quota.

What Was Revoked, and What That Left Behind

Executive Order 11246 was revoked outright on 21 January 2025 by Executive Order 14173, which also gave contractors a 90 day window to carry on complying with the old regulatory scheme if they chose (Federal Register). That order, signed in 1965, produced the affirmative action plan most people picture when they hear the phrase.

The agency response was quick. In July 2025 the Office of Federal Contract Compliance Programs closed every pending compliance review and abandoned the audit scheduling list published the previous November. The Department of Labor then proposed rescinding the implementing regulations at 41 CFR parts 60-1, 60-2, and 60-4, a rescission still sitting at the final rule stage. That gap is a paperwork lag rather than a live obligation, because a regulation implementing a revoked order has nothing left to implement.

Two further changes belong in the same picture. The special threshold requiring federal contractors with 50 or more employees to file the annual workforce demographic report came from the revoked order, so contractors now sit on the same 100 employee threshold as everybody else.

And federal contracting has acquired an obligation running the other way. Executive Order 14398, signed on 26 March 2026, requires agencies to insert a clause under which contractors undertake not to engage in racially discriminatory diversity activities, defined as disparate treatment based on race or ethnicity in recruitment, hiring, promotion, contracting, or training. A contractor now certifies about the absence of one thing while still writing plans for two others.

Who Is Required to Have a Written Plan Now

Only federal contractors and subcontractors meeting the size and contract value thresholds under Section 503 or under the veterans statute. No category of employer is now required to write an affirmative action plan addressing race, color, religion, sex, or national origin.

Both basic coverage thresholds moved on 1 October 2025, the disability one from $15,000 to $20,000 and the veterans one from $150,000 to $200,000, under the periodic inflation adjustment applied to acquisition thresholds across government contracting. The written plan threshold for the disability program stayed at 50 employees and a $50,000 contract.

Two traps sit inside this. The dollar figures printed in the regulations are older than the ones in force, so reading the rule and stopping there gives the wrong number. And subcontractors are covered on the same terms as prime contractors. A business that never bid for federal work can be pulled in by one flow-down clause from a customer who did.

A Voluntary Diversity Effort Is Not an Affirmative Action Plan

These are two different things governed by two different bodies of law, and collapsing the distinction is causing employers real trouble. A required plan is a regulatory document owed to a federal agency by a contractor. A voluntary diversity effort is a business decision owed to nobody, constrained by ordinary non-discrimination law.

The constraint is the part people miss. Title VII prohibits treating an individual differently because of race, color, religion, sex, or national origin, and it prohibits it in both directions. A program that widens the pool, advertises in more places, or trains interviewers to score consistently is lawful and always has been. One that reserves a slot or lets a protected characteristic decide between two candidates is a different animal.

The shelter voluntary programs relied on has also been withdrawn. On 29 June 2026 the Equal Employment Opportunity Commission voted to rescind the guidelines on affirmative action appropriate under Title VII at 29 CFR part 1608, which had stood since 1979 (Federal Register). The statute is unchanged. What changed is that the agency will no longer tell you a voluntary program was appropriate. None of that touches the useful work, which is auditing requirements nobody can justify and scoring every candidate the same way.

The Disability Program: What Goes In It

A Section 503 program is a written document covering qualified individuals with disabilities, prepared within 120 days of the contract commencing, kept at each establishment, and updated every year by a named official. Its contents are prescribed rather than optional.

Two elements are specific to disability and account for most of the work. The first is the invitation to self-identify: before the offer, again after the offer but before duties begin, and a survey of existing employees in the first year of coverage and at five year intervals after, with a reminder in between. The invitation must use the form prescribed by the agency, responses cannot be compelled, and the data is kept in a data analysis file rather than in medical files.

The second is the reasonable accommodation procedure, which overlaps almost entirely with what the Americans with Disabilities Act already requires at 15 or more employees. If you run a proper interactive process, the plan documents what you already do. If you do not, the plan is where the gap becomes visible.

One caveat for planning. The agency has proposed removing the utilization goal, the self-identification requirement, and the related data collection. That proposal drew overwhelmingly negative comment and has not been finalised, and the federal self-identification form has had its approval extended to 2029. Until a final rule appears, the existing requirements stand.

The Veterans Program: What Is Different About It

The veterans program shares the same skeleton but adds two duties with no counterpart on the disability side, and both are operational rather than documentary.

The job listing duty is the one that catches people. A covered contractor must list openings with the appropriate state employment service delivery system, and the exceptions are narrow: executive and top management roles, positions filled internally, and positions lasting three days or fewer. This is a workflow change rather than a policy, and it belongs inside your recruitment process, because an opening that closed without being listed cannot be fixed retrospectively.

The second addition is the annual veterans employment report, a separate federal filing rather than part of the plan. It is due by 30 September each year, the platform opens on 1 August, and it applies at the same $200,000 threshold. The Department of Labor sends no reminders, so it belongs on your own compliance calendar.

Utilization Goals and Hiring Benchmarks Are Not Quotas

Both surviving programs require a number, and neither requires you to reach it. The regulations say so explicitly, and the difference between measuring against a goal and being held to a target is the most misunderstood feature of this regime.

On the disability side the goal is a nationwide 7 percent applied to each job group, and a contractor with a total workforce of 100 or fewer employees may apply it to the entire workforce instead of building job groups at all. The evaluation is annual. The regulation states that the goal is not a rigid and inflexible quota, that it is neither a ceiling nor a floor, and that quotas are expressly forbidden (41 CFR 60-741.45). Falling below it is not a violation. It is a trigger to look at why.

On the veterans side there is no fixed percentage. A contractor sets a benchmark annually, either by adopting the national percentage of veterans in the civilian labor force published by the agency, currently 5.1 percent and effective from 30 July 2025, or by building its own from five specified data points covering state level veteran representation, veterans using state employment services, its own applicant and hire ratios, and the effectiveness of its outreach. The choice and its reasoning are documented and kept three years (41 CFR 60-300.45).

Recordkeeping, Reporting, and What a Review Looks At

Records under the disability regulations are kept two years from the making of the record or the personnel action, whichever is later, dropping to one year for a contractor with fewer than 150 employees that holds no contract of at least $150,000. Two categories run three years instead: the annual data collection analysis, and the written assessment of outreach effectiveness. Once a complaint or a compliance evaluation begins, the clock stops applying and the relevant records are preserved until the matter resolves.

The production deadlines are short. A plan must be submitted within 30 days of an agency request and made promptly available on site if asked. Thirty days is enough time to send a document and nowhere near enough to write one, which is the practical reason the annual update matters more than it looks.

On enforcement posture the honest answer is that it is in flux. Pending reviews were closed in July 2025 and the disability and veterans components held in abeyance before complaint processing resumed. The administration proposed defunding the enforcement office entirely for the 2026 fiscal year, and Congress declined, appropriating roughly $101 million and preserving its authority over both statutes. A similar proposal has been made again for the following year. None of that changes the obligation, which comes from the statutes rather than the office enforcing them.

How to Actually Put One Together

A first plan for a small contractor is a week of work, not a quarter, and most of that week goes on assembling numbers you already have rather than on writing prose.

The element worth taking seriously is the audit and reporting system, because it turns a document into a program. It does not need software. It needs somebody to look at applicant and hire counts once a quarter and record what was done about them. Keeping those records somewhere they survive a laptop change is the part FirstHR is built to carry.

If You Are Not a Federal Contractor, You Need None of This

A private business holding no federal contract and no federal subcontract has no obligation to write an affirmative action plan, has never had one, and does not acquire one by growing. The requirement has always been a condition of federal contracting rather than a general employment law duty.

What does apply is ordinary non-discrimination, and the thresholds are worth knowing precisely because they are lower than most owners assume.

Two edge cases are worth a look before you file this away. State and local government contracts sometimes carry their own equal opportunity conditions, a separate regime with its own thresholds. And a court can impose a remedial plan when resolving a discrimination case, which is the one route by which an ordinary employer ends up with something resembling a plan.

For everyone else the useful work is the unglamorous kind. Write the job requirements before you advertise, ask the same questions in the same order, score against criteria fixed in advance, keep the notes, and review any neutral rule that screens out a group without a job related reason. That last one is where disparate impact exposure lives, and it does not require anybody to have intended anything.

Where Employers Are Getting This Wrong Right Now

Six patterns, and four of them are new since the revocation.

Concluding that affirmative action planning ended in January 2025 is first and by far the most common. It ended for one of three programs, and a contractor who filed the whole thing away has stopped updating two plans an agency can demand within 30 days.

Using a downloaded template without checking its vintage is second. Almost every plan template still circulating describes the revoked regime, so it contains work you no longer owe and omits the work you do.

Reading the dollar thresholds out of the regulation is third. The printed figures lag the operative ones, and a contractor sitting between the old number and the new one can reach the wrong answer in either direction.

Assuming that being a subcontractor is a defence is fourth. Coverage flows down, and the moment to read the clause is before signing rather than after an agency letter arrives.

Treating a diversity initiative as though it discharges a compliance obligation is fifth. It discharges nothing, and since the withdrawal of the old voluntary guidelines it carries more risk than it used to rather than less.

And chasing the number instead of the record is last. A plan that meets its goal with no outreach assessment, no applicant and hire computation, and no audit system fails a review. A plan that misses its goal with all of that intact does not.

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