FAR 52.222-26—Equal Opportunity.
Plain-English Summary
FAR 52.222-26, Equal Opportunity, is the core federal contract clause implementing nondiscrimination and affirmative action obligations for covered contractors. It defines key terms such as compensation, compensation information, essential job functions, gender identity, sexual orientation, and United States, and it explains when the clause applies based on the value and timing of nonexempt federal contracts and subcontracts. It also addresses important exceptions, including work performed outside the United States by certain employees and a limited religious-organization exemption for employment of individuals of a particular religion. Substantively, the clause prohibits discrimination in employment on the bases of race, color, religion, sex, sexual orientation, gender identity, and national origin, and it requires affirmative action across hiring, promotion, demotion, transfer, recruitment, layoff, pay, and training. The clause also includes pay-transparency protections, barring retaliation for discussing compensation and requiring contractors to disseminate that prohibition to employees and applicants. In practice, this clause is a day-to-day compliance requirement that affects recruiting, job postings, employee handbooks, compensation practices, postings, union notices, and internal complaint handling, and it is a key part of a contractor’s equal employment opportunity compliance program.
Key Rules
Clause applies to covered contractors
The contractor must comply if, during any 12-month period including the 12 months before award, it has been or is awarded nonexempt federal contracts and/or subcontracts with an aggregate value over $10,000. The contractor must provide information on request to determine whether the clause applies.
Limited geographic and religious exceptions
The clause does not apply to work performed outside the United States by employees who were not recruited within the United States. A religious corporation, association, educational institution, or society is exempt from the clause’s requirements regarding employment of individuals of a particular religion, as provided in the cited DOL regulation.
No discrimination in employment
The contractor may not discriminate against any employee or applicant because of race, color, religion, sex, sexual orientation, gender identity, or national origin. The clause also recognizes a narrow permitted preference for Indians living on or near an Indian reservation when the employment opportunity is on or near an Indian reservation.
Affirmative action is required
The contractor must take affirmative action to ensure applicants are employed and employees are treated without regard to the protected characteristics. This obligation covers employment decisions such as hiring, upgrading, demotion, transfer, recruitment, layoff, termination, compensation, and selection for training, including apprenticeship.
Posting and solicitation notice duties
The contractor must post the notices provided by the Contracting Officer in conspicuous places available to employees and applicants. It must also state in solicitations and advertisements for employees that all qualified applicants will receive consideration without regard to the protected characteristics.
Pay-transparency and anti-retaliation protections
The contractor may not discharge or otherwise discriminate against employees or applicants because they inquire about, discuss, or disclose compensation. The clause includes a limited exception for employees whose essential job functions include access to compensation information, except for disclosures made in protected contexts such as complaints, investigations, proceedings, or legal compliance.
Required dissemination of pay policy
The contractor must disseminate the pay-transparency nondiscrimination prohibition using OFCCP-prescribed language. It must do this by incorporating the language into employee manuals or handbooks and by electronic posting or conspicuous physical posting.
Union notice requirement
The contractor must send the required notice to each labor union or worker representative with which it has a collective bargaining agreement or other contract or understanding, as specified in the clause.
Responsibilities
Contracting Officer
Provide the notices that explain the clause for posting, and determine or help determine clause applicability when requested information is needed from the contractor.
Contractor
Comply with the nondiscrimination, affirmative action, posting, solicitation, pay-transparency, dissemination, and union-notice requirements; maintain compliant employment practices; and furnish information needed to determine whether the clause applies.
Applicants and Employees
No affirmative duties are imposed by the clause, but they are protected from discrimination and retaliation and may inquire about, discuss, or disclose compensation subject to the clause’s protections and limited exception.
Labor Unions or Worker Representatives
Receive the required notice from the contractor when the contractor has a collective bargaining agreement or other contract or understanding with the representative.
OFCCP / Department of Labor
Provide the prescribed language for the compensation-discussion prohibition and administer the underlying equal employment opportunity framework referenced by the clause.
Practical Implications
Contractors should treat this as both an EEO clause and a pay-transparency rule; it affects hiring ads, handbooks, onboarding, and internal HR practices, not just formal discrimination complaints.
A common pitfall is failing to post the required notices or using outdated handbook language that does not include the OFCCP-prescribed compensation-discussion notice.
Another frequent issue is misunderstanding the compensation rule: employees generally may discuss pay, and discipline for such discussions can create a clause violation unless the narrow essential-job-functions exception applies.
Contractors with remote or overseas workforces should check the geographic limitation carefully, especially where employees were recruited in the United States or where mixed domestic/foreign performance is involved.
Religious-organization and Indian-reservation exceptions are narrow and fact-specific; contractors should document the basis for any claimed exception before relying on it.
Official Regulatory Text
As prescribed in 22.810 (e) , insert the following clause: Equal Opportunity (Sept 2016) (a) Definition . As used in this clause. Compensation means any payments made to, or on behalf of, an employee or offered to an applicant as remuneration for employment, including but not limited to salary, wages, overtime pay, shift differentials, bonuses, commissions, vacation and holiday pay, allowances, insurance and other benefits, stock options and awards, profit sharing, and retirement. Compensation information means the amount and type of compensation provided to employees or offered to applicants, including, but not limited to, the desire of the Contractor to attract and retain a particular employee for the value the employee is perceived to add to the Contractor's profit or productivity; the availability of employees with like skills in the marketplace; market research about the worth of similar jobs in the relevant marketplace; job analysis, descriptions, and evaluations; salary and pay structures; salary surveys; labor union agreements; and Contractor decisions, statements and policies related to setting or altering employee compensation. Essential job functions means the fundamental job duties of the employment position an individual holds. A job function may be considered essential if- (1) The access to compensation information is necessary in order to perform that function or another routinely assigned business task; or (2) The function or duties of the position include protecting and maintaining the privacy of employee personnel records, including compensation information. Gender identity has the meaning given by the Department of Labor’s Office of Federal Contract Compliance Programs, and is found at http://www.dol.gov/ofccp/LGBT/LGBT_FAQs.html . Sexual orientation has the meaning given by the Department of Labor’s Office of Federal Contract Compliance Programs, and is found at http://www.dol.gov/ofccp/LGBT/LGBT_FAQs.html . United States , means the 50 States, the District of Columbia, Puerto Rico, the Northern Mariana Islands, American Samoa, Guam, the U.S. Virgin Islands, and Wake Island. (b) (1) If, during any 12-month period (including the 12 months preceding the award of this contract), the Contractor has been or is awarded nonexempt Federal contracts and/or subcontracts that have an aggregate value in excess of $10,000, the Contractor shall comply with this clause, except for work performed outside the United States by employees who were not recruited within the United States. Upon request, the Contractor shall provide information necessary to determine the applicability of this clause. (2) If the Contractor is a religious corporation, association, educational institution, or society, the requirements of this clause do not apply with respect to the employment of individuals of a particular religion to perform work connected with the carrying on of the Contractor’s activities (41 CFR 60-1.5). (c) (1) The Contractor shall not discriminate against any employee or applicant for employment because of race, color, religion, sex, sexual orientation, gender identity, or national origin. However, it shall not be a violation of this clause for the Contractor to extend a publicly announced preference in employment to Indians living on or near an Indian reservation, in connection with employment opportunities on or near an Indian reservation, as permitted by 41 CFR 60-1 .5. (2) The Contractor shall take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, sexual orientation, gender identity, or national origin. This shall include, but not be limited to- (i) Employment; (ii) Upgrading; (iii) Demotion; (iv) Transfer; (v) Recruitment or recruitment advertising; (vi) Layoff or termination; (vii) Rates of pay or other forms of compensation; and (viii) Selection for training, including apprenticeship. (3) The Contractor shall post in conspicuous places available to employees and applicants for employment the notices to be provided by the Contracting Officer that explain this clause. (4) The Contractor shall, in all solicitations or advertisements for employees placed by or on behalf of the Contractor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, sexual orientation, gender identity, or national origin. (5) (i) The Contractor shall not discharge or in any other manner discriminate against any employee or applicant for employment because such employee or applicant has inquired about, discussed, or disclosed the compensation of the employee or applicant or another employee or applicant. This prohibition against discrimination does not apply to instances in which an employee who has access to the compensation information of other employees or applicants as a part of such employee's essential job functions discloses the compensation of such other employees or applicants to individuals who do not otherwise have access to such information, unless such disclosure is in response to a formal complaint or charge, in furtherance of an investigation, proceeding, hearing, or action, including an investigation conducted by the employer, or is consistent with the Contractor's legal duty to furnish information. (ii) The Contractor shall disseminate the prohibition on discrimination in paragraph (c)(5)(i) of this clause, using language prescribed by the Director of the Office of Federal Contract Compliance Programs (OFCCP), to employees and applicants by- (A) Incorporation into existing employee manuals or handbooks; and (B) Electronic posting or by posting a copy of the provision in conspicuous places available to employees and applicants for employment. (6) The Contractor shall send, to each labor union or representative of workers with which it has a collective bargaining agreement or other contract or understanding, the notice to be provided by the Contracting Officer advising the labor union or workers’ representative of the Contractor’s commitments under this clause, and post copies of the notice in conspicuous places available to employees and applicants for employment. (7) The Contractor shall comply with Executive Order 11246, as amended, and the rules, regulations, and orders of the Secretary of Labor. (8) The Contractor shall furnish to the contracting agency all information required by Executive Order 11246, as amended, and by the rules, regulations, and orders of the Secretary of Labor. The Contractor shall also file Standard Form100 (EEO- 1), or any successor form, as prescribed in 41 CFR Part 60 -1. Unless the Contractor has filed within the 12 months preceding the date of contract award, the Contractor shall, within 30 days after contract award, apply to either the regional Office of Federal Contract Compliance Programs (OFCCP) or the local office of the Equal Employment Opportunity Commission for the necessary forms. (9) The Contractor shall permit access to its premises, during normal business hours, by the contracting agency or the OFCCP for the purpose of conducting on-site compliance evaluations and complaint investigations. The Contractor shall permit the Government to inspect and copy any books, accounts, records (including computerized records), and other material that may be relevant to the matter under investigation and pertinent to compliance with Executive Order 11246, as amended, and rules and regulations that implement the Executive Order. (10) If the OFCCP determines that the Contractor is not in compliance with this clause or any rule, regulation, or order of the Secretary of Labor, this contract may be canceled, terminated, or suspended in whole or in part and the Contractor may be declared ineligible for further Government contracts, under the procedures authorized in Executive Order 11246, as amended. In addition, sanctions may be imposed and remedies invoked against the Contractor as provided in Executive Order 11246, as amended; in the rules, regulations, and orders of the Secretary of Labor; or as otherwise provided by law. (11) The Contractor shall include the terms and conditions of this clause in every subcontract or purchase order that is not exempted by the rules, regulations, or orders of the Secretary of Labor issued under Executive Order 11246, as amended, so that these terms and conditions will be binding upon each subcontractor or vendor. (12) The Contractor shall take such action with respect to any subcontract or purchase order as the Director of OFCCP may direct as a means of enforcing these terms and conditions, including sanctions for noncompliance, provided, that if the Contractor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of any direction, the Contractor may request the United States to enter into the litigation to protect the interests of the United States. (d) Notwithstanding any other clause in this contract, disputes relative to this clause will be governed by the procedures in 41 CFR 60-1 . (End of clause) Alternate I (Feb 1999) . As prescribed in 22.810 (e), add the following as a preamble to the clause: Notice : The following terms of this clause are waived for this contract: __________ [ Contracting Officer shall list terms ] .