Recently, in an effort to implement President Obama’s Executive Order (EO) 13673, “Fair Pay and Safe Workplaces,” the Federal Acquisition Regulatory Council issued a proposed regulation and the U.S. Department of Labor issued proposed guidance. This requirement, when implemented, will require covered federal contractors to disclose labor violations, contracting agencies to assess these violations, and the DOL to provide assistance.
An employer’s record of violations may now be taken into account when contemplating whether to award future contracts, cancel existing contracts, and to potentially demand remedial action to address a pattern of violations.
Furthermore, the proposed guidance and regulations will require contractors to notify workers of their classification as an employee or independent contractor, exempt or non-exempt status under the FLSA, and provide thorough information and disclosures about workers’ pay. Employers with a government contract that exceeds $1 million will be barred from requiring employees to enter into mandatory pre-dispute arbitration agreements for disputes arising out of torts related to sexual harassment or assault, or the Title VII of the Civil Rights Act.
Supporters of the Fair Pay EO say it is intended to improve government contractor compliance with workplace labor requirements administered by the DOL as well as equivalent state laws.
Critics believe the proposed rules will deny federal contractors due process and permit or encourage discrimination in federal contracting based on arbitrary criteria, pre-adjudicated and/or false accusations, or a contractor’s labor affiliation.