Here's the way the federal affirmative action regulations work: if your company is a direct federal contractor or if your company acts as a subcontractor to a federal contractor and receives federal dollars, your company may be subject to these regulations. If your company does no direct work with the federal government AND if your company does not act as a federal subcontractor, then your company is not required to follow the federal affirmative action regulations. (A federal subcontractor is a company whose products or services are necessary to the completion of a federal contract.) Contracts or subcontracts held by your VENDORS do not matter; contracts or subcontractors held by YOUR company determine your status. Let's provide a few examples here to make sure this is clear. If your company makes vehicle windshields, and your company sells windshields to a customer that uses them in vehicles that are sold to the military, your company would be considered a federal subcontractor, and would potentially be subject to the federal affirmative action regulations. (See below on why I say "potentially.") Conversely, if your company makes donuts, and you never sell any donuts to the federal government, and your company never sells to any donuts to distributors or other organizations that resell those donuts to the federal government, then your company would (likely) not be subject to the federal affirmative action regulations. It would not matter for your company if one of the distributors sells millions of dollars in other products to the federal government if the distributor does not sell YOUR donuts to the federal government. (Mmmmm....donuts.....) Even if your company does sell directly to the federal government, your company may not be covered by the federal affirmative action regulations. As a general matter, to be covered by any of these regulations, your company would need to sell at least $10,000 on a single contract or subcontract to the government. Thus, if your company makes donuts, and sells $9,999 worth of donuts to a military commissary, your company would still not be covered. There are a variety of rules in regard to coverage, and I can't get into them all here, but suffice it to say that selling products directly or indirectly to the government doesn't always make your company a covered entity. The bottom line is that your coverage for affirmative action purposes doesn't depend on your subcontractors. It depends on your customers. Now, I need to go find me some donuts. Mmmmm.....donuts.....

You can use this OFCCP audit checklist to ensure you're doing what is required to maintain OFCCP's regulations including VEVRAA, Section 503, and EO 11246. Or request a demo to streamline your compliance and recruiting efforts.