FAR and DFARS › DFARS Part 226: Other Socioeconomic Programs › Subpart 226.72

DFARS 226.7201 Definitions.

The codified text (eCFR, as of 2026-10-02). Under the Revolutionary FAR Overhaul ↗, agencies follow class deviations with new text for many parts while the formal rules go through the Federal Register: check the solicitation and your contract's clauses, which rule.

In plain English

This section defines two key terms for a DFARS subpart: 'eligible contractor' and 'severely disabled individual.' It matters to contractors because it sets the criteria a business must meet to qualify as an eligible contractor, which may affect participation in certain set-aside or preference programs.

Applies to: Business entities seeking to qualify as eligible contractors under this DFARS subpart

What it requires

Employ severely disabled individuals at a rate averaging at least 33% of total workforce over the 12 months before solicitation issuance
Pay severely disabled employees at least the minimum wage under 29 U.S.C. 206
Provide health insurance and a retirement plan comparable to similar-sized businesses in the same sector or region

Key terms: eligible contractor · severely disabled individual · severe physical or mental impairment · functional capacities

Written by AI from this section's text. A guide, not legal advice: the text below rules.

The text

As used in this subpart—

Eligible contractor means a business entity operated on a for-profit or nonprofit basis that—

(1) Employs severely disabled individuals at a rate that averages not less than 33 percent of its total workforce over the 12-month period prior to issuance of the solicitation;

(2) Pays not less than the minimum wage prescribed pursuant to 29 U.S.C. 206 to the employees who are severely disabled individuals; and

(3) Provides, for its employees, health insurance and a retirement plan comparable to those provided for employees by business entities of similar size in its industrial sector or geographic region.

Severely disabled individual means an individual with a disability (as defined in 42 U.S.C. 12102) who has a severe physical or mental impairment that seriously limits one or more functional capacities.

← 226.7200 Scope of subpart. · 226.7202 Policy and procedures. →

Rule changes for DFARS Part 226

Defense Federal Acquisition Regulation Supplement: Sustainable Procurement (DFARS Case 2024-D024) ↗ · final rule 2024-08-15 · effective 2024-08-15

Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Plain words for the terms: glossary.