Providing you have have a 3-byte PD field in input positions 117-119, it will work if both input files have RECFM=VB, or if both input files have RECFM=FB and the same LRECL. Note that for variable records, there's an RDW in positions 1-4 so the first data byte starts at position 5. This is important when determining the correct starting position of the SORT field.
Is there some reason why you couldn't have just tried it to see if it worked?
If you're not familiar with DFSORT and DFSORT's ICETOOL, I'd suggest reading through "z/OS DFSORT: Getting Started". It's an excellent tutorial, with lots of examples, that will show you how to use DFSORT, DFSORT's ICETOOL and DFSORT Symbols. You can access it online, along with all of the other DFSORT books, from: