Department of Labor

Many contractors are familiar with the Davis-Bacon Act (“DBA”), the statute that requires government contractors to pay prevailing wages to workers employed in the construction, alteration, or repair of buildings or other public works.  The DBA is enforced by the Department of Labor, which is responsible for issuing the “wage determinations” that list the prevailing wages for different labor categories within a geographical area and for promulgating regulations used to implement the DBA’s requirements.

On March 18, 2022, the Department issued a notice of proposed rulemaking (“NPRM”), announcing that it intends to make a number of revisions to the DBA regulations.  In the Department’s view, these revisions represent the largest change to the DBA regulations since the last major rewrite in 1981.Continue Reading Department of Labor Proposes Overhaul to Davis-Bacon Act Regulations

The Trump Administration has declared this month National Slavery and Human Trafficking Prevention Month, calling on industry associations, law enforcement, private businesses, and others to work toward ending modern slavery and human trafficking. This proclamation follows the Administration’s efforts to combat human trafficking, which we have previously discussed here, and comes on the heels of an OMB memorandum released last fall aimed at “enhanc[ing] the effectiveness of anti-trafficking requirements in Federal acquisition while helping contractors manage and reduce the burden associated with meeting these responsibilities.”
Continue Reading Trump Administration Renews Focus on Anti-Human Trafficking Efforts

Keen observers of federal suspension and debarment practice have noticed a recent change at the Department of Labor (DOL):  After years of inactivity, DOL’s discretionary suspension and debarment program suddenly came to life in 2017 and has been issuing suspensions and debarments at a steady clip ever since. [1]  Now, according to a recent announcement, DOL is poised to turn up its suspension and debarment activity yet another notch.  Starting this month and continuing through April 2020, DOL will be instituting a pilot program aimed at promoting and expediting its suspension and debarment activity, with the stated goal of “reduc[ing] the processing time on discretionary suspension and debarment actions from months to days.” 
Continue Reading Suspension & Debarment Update: Department of Labor Announces New Pilot Program

Last Thursday, President Trump and his senior advisors met with representatives of organizations committed to fighting human trafficking. As reported by several news outlets (e.g., AP, NYT, and Reuters), the President stated during the meeting that he would commit the “full force and weight” of the U.S. government against what he views as an “epidemic” of human trafficking around the world.  He explained that he would “direct the Department of Justice, Department of Homeland Security, and other federal agencies that have a role in preventing human trafficking to take a hard look at the resources and personnel that they are currently devoting to this fight.”  He noted that these agencies “are devoting a lot, but we are going to be devoting more.”  The next day, President Trump appeared to reiterate his commitment on Twitter.
Continue Reading Trump’s Commitment Against Human Trafficking Brings Greater Uncertainty for Contractors

On December 7, the Office of Management and Budget, the Department of Labor, and the Office to Monitor and Combat Trafficking in Persons in the Department of State, issued a proposed memorandum titled “Anti-Trafficking Risk Management Best Practices & Mitigation Considerations.”  The document is intended, at least in part, to “promote clarity and consistency in the implementation of anti-trafficking requirements” imposed by Executive Order 13627, Title XVII of the FY 2013 National Defense Authorization Act, and the implementing regulatory provisions applicable to all federal contractors at FAR 22.17 and FAR 52.222-50.  Although the guidance document is in draft form, it is important for contractors to consider closely because it (1) outlines the government’s contemplated expectations on anti-trafficking risk mitigation, and (2) informs agencies that they may immediately take the contents of the memorandum “into consideration in applying the anti-trafficking requirements in the Federal Acquisition Regulation.”

In addition to reiterating the basic requirements of the anti-trafficking FAR rule (which we have covered in other posts), the memorandum outlines a series of “best practices and mitigation considerations” designed to inform contracting officers’ assessments of whether contractors are effectively carrying out their compliance responsibilities.  Although the guidance states that it is “not intended to augment or otherwise change existing regulatory requirements,” it does specify that, in the event the government becomes aware of a trafficking violation, a contractor’s compliance with the practices identified in the guidance are to be construed as mitigating considerations weighing in the contractor’s favor.  
Continue Reading New Guidance on Contractor Risk Management Under the Human Trafficking Rule Released

On May 4, the Labor Department and Federal Acquisition Regulatory (“FAR”) Council submitted to the White House Office of Management and Budget (“OMB”) their final versions of regulations and guidance (respectively) implementing Executive Order 13673, entitled “Fair Pay and Safe Workplaces” (“FPSW Order”).  The FPSW Order, which requires contractors bidding on government contracts to disclose past violations of any one of at least 14 federal labor laws and their state law counterparts, has been met with harsh criticism from contractors and members of congress since its July 2014 issuance by President Obama.  (See our blog post here for more analysis of the proposed regulations implementing the Order.)  The most recent attack occurred just one week prior to the Labor Department and FAR Council submissions: the House Armed Services Committee adopted an amendment that would exempt the entire Department of Defense (“DOD”) from the FPSW Order.
Continue Reading Battle over “Blacklisting” Order: Obama Administration Moves Forward with Fair Pay Order as House Members Attempt to Exempt DOD

The key word is “suffer.”

Government contractors already face painful compliance burdens associated with the Fair Pay and Safe Workplaces Executive Order, the proposed implementing regulations, and the Labor Department’s “Guidance” amplifying the proposed regulations.  Last week, the Department added another layer of complexity when it issued an Administrator’s Interpretation of the Fair Labor Standards Act.  (Covington’s Employment group analyzed the Interpretation here.)  The fifteen-page Interpretation stems from the Department’s conclusion that companies are increasingly misclassifying employees as independent contractors.  It explains the Department’s view that the statutory definition of employ (“to suffer or permit to work”) informs the distinction between those classes of workers.  We hate to spoil an ending, but the bottom line is clear:  “most workers are employees.”

The Interpretation applies across a broad range of industries, but it presents special issues for government contractors.  Federal contracts in excess of $500,000 trigger obligations under the Paycheck Transparency provisions (section 5) of the Executive Order.  The proposed regulations require employers with covered contracts to provide each worker whom they classify as an independent contractor with “a document … informing the individual of that status.”  Contractors must look elsewhere for guidance on format and content of the document.Continue Reading Labor Department’s Interpretation of the FLSA’s “Suffer or Permit” Standard Triggers More Compliance Burdens for Government Contractors

Company communications with government authorities about potential criminal activity or wrongdoing by the company’s employees may expose that company to liability for defamation; that is, unless those communications are considered privileged.  In the majority of states, communications with police or prosecutors are afforded “qualified” or “conditional” privilege, and generally may be the basis of a defamation suit only if they are made with malice or are knowingly false.  And several states have afforded absolute privilege or immunity to communications that are made in response to a government investigation that could lead to prosecution.

But importantly for contractors, potential defamation liability on the basis of statements to the government could arise outside the context of a government investigation.  For example, the recent issuance of the Fair Pay Safe Workplaces Order (“FPSW Order” or “Order”), which requires contractors to disclose violations of number of labor laws, may have significant implications for contractors’ exposure to defamation suits.  
Continue Reading New Obligations to Disclose Labor Law Violations Could Expose Contractors to Defamation Liability

Today, the Department of Labor (“DOL”) published a new final rule “prohibiting discrimination on the bases of sexual orientation and gender identity in the federal contracting workforce.”  This rule implements Executive Order 13672, signed by President Obama on July 21, and marks the first federal action ensuring LGBT workplace equality that implicates the private sector.

Prior to implementation of this rule, as a result of Executive Order 11246, federal regulations prohibited federal contractors and subcontractors from discriminating on the basis of race, color, religion, sex, and national origin, and required them to take affirmative steps  to prevent discrimination on those bases from occurring.  Now, however, the list of classifications will be amended to substitute  “sex, sexual orientation, gender identity, or national origin” for “sex or national origin.”  The new language must be inserted into the Equal Opportunity Clause by federal agencies in all covered contracts and by prime contractors into covered subcontracts.  The new language will apply to contracts entered into or modified on or after April 8, 2015 (the effective date).

Last Wednesday, December 3, following DOL’s announcement of the final rule, Rep. John Kline, Chair of the House Education and Workforce Committee, and Rep. Tim Walberg, Chair of the House Subcommittee on Workforce Protections, sent a letter to the Director of DOL’s Office of Federal Contract Compliance Program (“OFCCP”) urging that the Office allow for a 60-day period for the public to comment on the regulation.  The Congressmen asserted that Section 553 of the Administrative Procedure Act (“APA”) requires general notice of a proposed rulemaking with an opportunity for public participation.  DOL, of course, disagreed. The agency  indicated that implementation without prior notice and comment “is consistent with agency precedent under other Administrations,” and that because the Executive Order was “very clear” and “left no discretion regarding how to proceed,” principles of administrative law allow DOL to publish the final rule without prior notice or comment.Continue Reading DOL Implements New Rule: Government Contractors and Subcontractors Prohibited from Discriminating Against LGBT Workers.