The literature was surveyed and discussions were conducted with various federal officials, state administrators, and private employers to evaluate private employers' policies with regard to disabled persons. Key employment programs for disabled workers were reviewed, including the Employment Services System (Job Service), the Comprehensive Employment and Training Act, Title III--Special Projects, Sheltered Workshops, additional demonstration efforts funded by the Department of Labor, private sector initiatives for disabled persons, and services by the Rehabilitation Services Administration of the Department of Education. These programs and projects indirectly addressed the need to work closely with private employers to eliminate stereotypes of the abilities of disabled workers and to identify processes to facilitate job placement. Four specific barriers to employment faced by handicapped individuals were explored: job modification, employer hiring practices, productivity concerns, and fringe benefit packages. (Following a 10-page bibliography is a review of British research literature regarding employment problems of physically disabled people.) (YLB)