(2) Identify problem areas in conjunction with line management and known handicapped employees, in the implementation of the affirmative action programs, and develop solutions. This is particularly important for the accommodations requirements. (3) Design and implement audit and reporting systems that will:

(i) Measure effectiveness of the contractor's programs.

(ii) Indicate need for remedial action.

(iii) Determine the degree to which the contractor's objectives have been attained.

(iv) Determine whether known handicapped employees have had the opportunity to participate in all company sponsored educational, training, recreational and social activities.

(v) Ensure that each location is in compliance with the Act and the regulations in this Part.

(4) Serve as liaison between the contractor and enforcement agencies.

(5) Serve as liaison between the contractor and organizations of and for handicapped persons, and arrange for the active involvement by company representatives in the community service programs of local organizations of and for the handicapped.

(6) Keep management informed of the latest developments in the entire affirmative action area.

(7) Arrange for career counseling for known handicapped employees.

(i) Development and execution of aƒfirmative action programs. (1) Job qualification requirements reviewed pursuant to paragraph (c) of this section should be made available to all members of management involved in the recruitment, screening, selection, and promotion process.

(2) The contractor should evaluate the total selection process including training and promotion to ensure freedom from stereotyping handicapped persons in a manner which limits their access to all jobs for which they are qualified.

(3) All personnel involved in the recruitment, screening, selection, promotion, disciplinary, and related processes should be carefully selected and trained to ensure that the commit

ments in its affirmative action program are implemented.

(4) Formal briefing sessions should be held, preferably on company premises, with representatives from recruiting sources. Plant tours, clear and concise explanations of current and future job openings, position, descripticns, worker specifications, explanations of the company's selection process, and recruiting literature should be an integral part of the briefings. Formal arrangements should be made for referral of applicants, follow up with sources, and feedback on disposition of applicants.

(5) A special effort should be made to include qualified handicapped persons on the personnel relations staff.

(6) Handicapped employees should be made available for participation in career days, youth motivation programs, and related activities in their communities.

(7) Recruiting efforts at all schools should incorporate special efforts to reach handicapped students.

(8) An effort should be made to participate in workstudy programs with rehabilitation facilities and schools which specialize in training or educating handicapped individuals.

(9) The contractor should use all available resources to continue or establish on the job training programs.

(j) Sheltered workshops. Contracts with sheltered workshops do not constitute affirmative action in lieu of employment and advancement of qualified handicapped individuals in the contractor's own workforce. Contracts with sheltered workshops may be included within an affirmative action program if the sheltered workshop trains employees for the contractor and the contractor is obligated to hire trainees at full compensation when such trainees become qualified as "qualified handicapped individual" as defined in § 60-741.2.

[41 FR 16148, Apr. 16, 1976; 42 FR 3307, Jan. 18, 1977]

§ 60-741.7 Determination of handicap.

(a) Any handicapped individual filing a complaint with the Director under this Part shall submit with his or her complaint a signed statement

specifying the handicapping impairment or situation (see § 60-741.2 definition of "handicapped individual”). If the Director determines that further documentation is necessary, he or she may require the complainant to provide additional information.

(b) Any contractor requiring a determination of an applicant's or employee's handicap may require the applicant or employee to provide medical documentation of the impairment or, in the alternative, may require the applicant or employee to undergo a medical examination at the contractor's expense.

(c) Any determination of handicap required pursuant to paragraph (b) of this section must meet the requirements of § 60-741.5(c) and must be for the purpose of affirmative action and proper job placement. Information obtained therefrom shall not be used to exclude or otherwise limit the employment opportunities of qualified handicapped individuals.

(d) All medical documentation required under this section shall be based upon the American Medical Association Guides to the Evaluation of Permanent Impairment, provided that the Guides shall be used only to determine the existence of impairment without regard to the degree of impairment.

§ 60-741.8 Listing of employment openings.

Contractors should request state employment security agencies to refer qualified handicapped individuals for consideration under their affirmative action programs.

§ 60-741.9 Labor unions and recruiting and training agencies.

(a) Whenever performance in accordance with the affirmative action clause or any matter contained in the regulations in this Part may necessitate a revision of a collective bargaining agreement, the labor union or unions which are parties to such agreements shall be given an adequate opportunity to present their views to the agency, or to the Director.

(b) The Director shall use his or her best efforts, directly or through con

tractors, subcontractors, local officials, vocational rehabilitation facilities, and all other available instrumentalities, to cause any labor union, recruiting and training agency or other representative of workers who are or may be engaged in work under contracts and subcontracts to cooperate with, and to assist in, the implementation of the purposes of the Act.

Subpart B-General Enforcement and Complaint Procedure

§ 60-741.20 Subcontracts.

Each nonexempt prime contractor and subcontractor shall include the affirmative action clause prescribed in § 60-741.4 in each of their nonexempt subcontracts. The clause may be incorporated by reference in accordance with § 60-741.22.

[41 FR 16148, Apr. 16, 1976; 42 FR 3307, Jan. 18, 1977]

§ 60-741.21 Adaptation of language.

Such necessary changes in language may be made to the affirmative action clause (see § 60-741.4) as shall be appropriate to identify properly the parties and their undertakings.

[41 FR 16148, Apr. 16, 1976; 42 FR 3307, Jan. 18, 1977]

§ 60-741.22 Incorporation by reference.

The affirmative action clause and the regulations contained in this Part may be incorporated by reference in all contracts and subcontracts.

§ 60-741.23 Incorporation by operation of the Act and agency regulations.

By operation of the Act, the affirmative action clause shall be considered to be a part of every contract and subcontract required by the Act and the regulations in this Part to include such a clause, whether or not it is physically incorporated in such contracts and whether or not there is a written contract between the agency and the contractor.

60-741.24 Duties of agencies.

(a) General responsibility. Each agency shall cooperate with the Director in the performance of his or her

responsibilities under the Act. Such cooperation shall include the responsibility to ensure that contractors are fully cognizant of their obligations under the Act and this Part, to provide the Director with any information which comes to its attention that the contractor is not in compliance with the Act or this Part, and to take such actions for noncompliance as set forth in § 60-741.28 as may be ordered by the Director.

(b) Designation of agency official. The head of each agency, or his or her designee, shall identify and submit to the Director the name, address and telephone number of the official within the agency who is primarily responsible for implementation of this program within the agency.

141 FR 16148, Apr. 16, 1976; 42 FR 3307, Jan. 18, 1977]

§ 60-741.25 Evaluations by the Director.

The Director shall be primarily responsible for undertaking such investigations of complaints and other matters as well as evaluations of contractor and agency performance as may be necessary to assure that the purposes of section 503 of the Rehabilitation Act of 1973 are being effectively carried out.

§ 60-741.26 Complaint procedures.

(a) Place and time of filing. Any applicant for employment with a contractor or any employee of a contractor may, personally or by an authorized representative, file a written complaint with the Director alleging a violation of the Act or the regulations in this Part. Such complaint must be filed within 180 days from the date of the alleged violation, unless the time for filing is extended by the Director for good cause shown.

(b) Referral to contractor. When a complaint is filed by an employee of a contractor and the contractor has an applicable internal review procedure, the complaint shall be referred to the contractor for processing under that procedure. The complaint and all actions taken thereunder shall be kept confidential by the contractor. If there has not been a resolution of the complaint under that procedure satis

factory to the complainant within 60 days of the referral, the Department of Labor or the designated agency will proceed as provided in this section.

(c) Contents of complaints. Complaints must be signed by the compiainants or their authorized representatives and must contain the following information: (1) Name and address (including telephone number) of the complainant, (2) name and address of the contractor or subcontractor who committed the alleged violation, (3) a description of the act or acts considered to be a violation, (4) a signed statement that the individual is handicapped or has a history of a handicap or other documentation of impairment or was regarded by the contractor as having an impairment, and (5) other pertinent information available which will assist in the investigation and resolution of the complaint, including the name of any known federal agency with which the employer has contracted.

(d) Incomplete information. Where a complaint contains incomplete information, the Director or the agency designated by the Director for investigation of the complaint shall seek the needed information from the complainant. If the information is not furnished to the agency or the Director within 60 days of the date of such request, the case may be closed.

(e) Investigations. The Department of Labor or the designated agency shall institute a prompt investigation of each complaint, and shall be responsible for developing a complete case record. A complete case record consists of the following: (1) Name and address of each person interviewed, (2) a summary of his or her statement, (3) copies or summaries of pertinent documents, (4) a narrative summary of the evidence disclosed in the investigation as it related to each charge, and (5) recommended findings and resolution.

(f) Responsibilities of agencies. Agencies shall conduct investigations of complaints in accordance with specific requests of the Director.

(g) Resolution of matters. (1) If the complaint investigation shows no violation of the Act or regulations in this Part, or if the agency or the Director

decides not to initiate administrative or legal proceedings against the contractor, the complainant shall be so notified. Within 30 days, the complainant may request review by the Director of such a finding or decision.

(2) Where an investigation indicates that the contractor has not complied with the requirements of the Act or this Part, efforts shall be made to secure compliance through conciliation and persuasion within a reasonable time. Before the contractor or subcontractor can be found to be in compliance, it must make a specific commitment, in writing, to take corrective action to meet the requirements of the Act and this Part. The commitment must indicate the precise action to be taken and dates for completion. The time period allowed should be no longer than the minimum period necessary to effect such changes. Upon approval of such commitment by the Director or the agency, the contractor may be considered in compliance on condition that the commitments are kept. Where the matter has been referred to an agency for investigation and resolution, the contractor and the complainant shall be advised that the resolution is subject to review by the Director and may be disapproved if it is determined that such resolution is not sufficient to achieve compliance.

(3) Where the complaint investigation indicates a violation of the Act or regulations in this Part (and the complaint has not been resolved by informal means), the Director, or the agency with the approval of the Director, shall afford the contractor an opportunity for a hearing in accordance with § 60-741.29.

§ 60-741.27 Noncompliance with the affirmative action clause.

Noncompliance with the prime contractor's or subcontractor's obligations under the affirmative action clause is a ground for taking appropriate action for noncompliance as set forth in § 60741.28 by the agency, the Director, prime contractor, or subcontractor. Any such noncompliance shall be reported in writing to the Director by

the agency as soon as practicable after it is identified.

[41 FR 16148, Apr. 16, 1976; 42 FR 3307, Jan. 18, 1977]

§ 60-741.28 Actions for noncompliance.

(a) General. In every case where any complaint investigation indicates the existence of a violation of the affirmative action clause or these regulations, the matter should be resolved by informal means, including conciliation, and persuasion, whenever possible. This will also include establishing a corrective action program in accordance with § 60-741.26(g)(2). Where the apparent violation is not resolved by informal means, the Director or the agency shall proceed in accordance with the enforcement procedures contained in this Part.

(b) Judicial enforcement. In addition to the administrative remedies set forth herein, the Director may, within the limitations of applicable law, seek appropriate judicial action to enforce the contractual provisions set forth in § 60-741.4 including appropriate injunctive relief.

(c) Withholding progress payments. With the prior approval of the Director so much of the accrued payment due on the contract or any other contract between the government prime contractor and the federal government may be withheld as necessary to correct any violations of the provisions of the affirmative action clause.

(d) Termination. A contract or subcontract may be cancelled or terminated, in whole or in part, for failure to comply with the provisions of the affirmative action clause.

(e) Debarment. A prime contractor or subcontractor or a prospective contractor or subcontractor may be debarred from receiving future contracts for failure to comply with the provisions of the affirmative action clause. § 60-741.29 Formal hearings.

(a) Hearing opportunity. An opportunity for a formal hearing shall be afforded to a prime contractor or a subcontractor or a prospective prime contractor or subcontractor by the agency or Director in any of the following circumstances:

(1) An apparent violation of the affirmative action clause by a contractor or subcontractor, as shown by any investigation, is not resolved by informal means and a hearing is requested; or

(2) The Director, or an agency upon prior notification to the Director, proposes to cancel or terminate the contract or withhold progress payments, or cause the contract to be canceled or terminated or progress payments to be withheld, in whole or in part, on a contract or contracts, or to require cancellation or termination of a contract or subcontract or withholding of progress payments; or

(3) The Director, or an agency with the approval of the Director, proposes to declare a prime contractor or subcontractor ineligible for further contracts or subcontracts under the Act.

(b) Hearing practice and procedure. (1) All hearings conducted under section 503 of the Rehabilitation Act of 1973, as amended, and the regulations in this Part shall be governed by the Rules of Practice for Administrative Proceedings to Enforce Equal Opportunity Under Executive Order 11246 contained in 41 CFR Part 60-30 except that complaints shall be issued by the Associate Solicitor, Division of Labor Relations and Civil Rights, Office of the Solicitor, rather than by the Solicitor of Labor.

(2) For the purposes of hearings pursuant to this Part 60-741, references in 41 CFR Part 60-30 to "Executive Order 11246" shall mean section 503 of the Rehabilitation Act of 1973, as ainended; to "equal opportunity clause" shall mean the affirmative action clause published at 41 CFR 60741.4; and to "regulations" shall mean the regulations contained in this Part 60-741.

(3) The Administrative Law Judge's recommended findings, conclusions and decision shall be certified to the Assistant Secretary, Employment Standards Administration rather than to the head of the compliance agency or to the Secretary (see 41 CFR 6030.27). Accordingly, exceptions to the recommended decision (41 CFR 6030.28) shall be filed with the Assistant Secretary, Employment Standards Administration, and the final Adminis:

trative Order contemplated by 41 CFR 60-30.30 shall be issued by the Assistant Secretary, Employment Standards Administration. Except for these changes in procedure, all the other provisions of the rules of practice cited in this 41 CFR 60-741.29(b) shall remain in full force and effect

[41 FR 16148, Apr. 16, 1976, as amended at 42 FR 19146, Apr. 12, 1977]

§ 60-741.30 Notification of agencies.

The Director shall notify the heads of all agencies of any action for noncompliance taken against any contractor after such actions have been taken. No agency may issue a waiver under § 60-741.3(b)(1) to any contractor subject to such action without prior approval of the Director.

[41 FR 16148, Apr. 16, 1976; 42 FR 3307, Jan. 18, 1977]

§ 60-741.31 Contractor ineligibility list.

The Director shall distribute periodically a list to all executive departments and agencies giving the names of prime contractors and subcontractors who have been declared ineligible under the regulations in this Part and the Act.

§ 60-741.32 Disputed matters related to the affirmative action program.

The procedures set forth in the regulations in this Part govern all disputes relative to a contractor's compliance with the affirmative action clause and the requirements of this Part. Any disputes relating to issues other than compliance, including contract costs arising out of the contractor's efforts to comply, shall be determined by the disputes clause of the contract.

Subpart C-Ancillary Matters

§ 60-741.50 Reinstatement of ineligible contractors and subcontractors.

Any prime contractor or subcontractor debarred from further contracts or subcontracts under the Act may request reinstatement in a letter directed to the Director. In connection with the reinstatement proceedings, the prime contractor or subcontractor