Employment

On Tuesday, March 4, 2025, President Trump addressed a joint session of Congress, and highlighted many of the actions his administration has taken during his first six weeks in office.  This timeline highlights key developments pertaining to recent executive orders (“EOs”) and other executive actions issued by the second Trump administration.  It focuses on issues most relevant to federal contractors and grant recipients, and is divided into five topics: (1) Federal Funding; (2) DEI and Gender; (3) Energy and Environment; (4) Trade and Foreign Aid; and (5) DOGE and Federal Workforce.  Covington’s Government Contracts Practice is continuing to track these and other developments and will plan to periodically update this timeline.

This document provides a high-level summary of recent events and is not exhaustive. In addition, this document was last updated on the date provided above.  To the extent you may have questions regarding any of the developments discussed below — or other matters — please reach out to a member of Covington’s Government Contracts Practice.Continue Reading Timeline of Key Developments Related to Recent Executive Actions as of March 12, 2025

On Tuesday, March 4, 2025, President Trump addressed a joint session of Congress, and highlighted many of the actions his administration has taken during his first six weeks in office.  This timeline highlights key developments pertaining to recent executive orders (“EOs”) and other executive actions issued by the second Trump administration.  It focuses on issues most relevant to federal contractors and grant recipients, and is divided into five topics: (1) Federal Funding; (2) DEI and Gender; (3) Energy and Environment; (4) Trade and Foreign Aid; and (5) DOGE and Federal Workforce.  Covington’s Government Contracts Practice is continuing to track these and other developments and will plan to periodically update this timeline.

This post provides a high-level summary of recent events and is not exhaustive. In addition, this document was last updated on the date provided above.  To the extent you may have questions regarding any of the developments discussed below — or other matters — please reach out to a member of Covington’s Government Contracts Practice.Continue Reading Timeline of Key Developments Related to Recent Executive Actions as of March 5, 2025

Earlier this month, the Fifth Circuit ruled in favor of a Biden administration order raising the minimum wage of many types of federal contract workers.  The executive order remains subject to litigation (in both the Fifth Circuit and elsewhere), but is currently effective throughout the country, with a narrow exception for certain state agencies. 

President Biden’s Executive Order 14026 (“the EO”), issued in April 2021, raised the hourly minimum wage to $15.00 for federal contract workers for the following contract types:

  • Procurement contracts for construction projects covered by the Davis-Bacon Act (“DBA”);
  • Service contracts falling under the Service Contract Act (“SCA”);
  • Concessions contracts, including those excluded from the SCA by DOL regulations at 29 C.F.R. 4.133(b); and,
  • Contracts related to federal property or lands and connected to providing services for federal employees, their dependents, or the general public.

EO 14026 directs the U.S. Department of Labor to annually update the hourly minimum wage.  We wrote in October 2024 about DOL’s annual update effective January 1, 2025, which raised the minimum wage for covered contracts from $17.20 to $17.75.  More details are below.Continue Reading Fifth Circuit Adds New Wrinkle to Ongoing Fight Over Federal Contract Worker Minimum Wage Requirement

As previously discussed on this blog, President Trump issued several executive orders (“EOs”) and memoranda, many of which may have implications for federal contractors and grant recipients.  During the first 30 days of the second Trump Administration, Covington’s Government Contracts Practice Group has tracked developments related to these EOs…

Continue Reading Timeline of Key Developments Related to Recent Executive Actions

The U.S. Department of Labor (“DOL”) recently announced its annual update to the hourly minimum wage for federal contract workers.  Beginning January 1, 2025, the minimum wage for employees performing work on or in connection with covered contracts will increase from $17.20 to $17.75 per hour.  The increase applies to tipped and non-tipped employees, as well as employees with disabilities.

The DOL announcement follows President Biden’s Executive Order 14026, issued in April 2021, to “promote economy and efficiency in procurement by contracting with sources that adequately compensate their workers.”  We discuss the types of federal contracts and workers subject to the wage rate increase, and its implications for contractors, below.Continue Reading Bigger Pay Days Are Coming for Some Federal Contract Workers in 2025

Recently, the Department of Labor (“DOL”) Office of Federal Contract Compliance Programs (“OFCCP”) unveiled new guidance regarding the use of automated systems and artificial intelligence (collectively referred to as “AI”) in the workplace.  This guidance was issued as a part of a series of actions that the Biden administration has taken to address AI in various contexts and industries. 

The OFCCP guidance follows President Biden’s Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence, which directed the Secretary of Labor to “publish guidance for Federal contractors regarding nondiscrimination in hiring involving AI and other technology-based hiring systems.”  Specifically, the guidance addresses how federal prime contractors and subcontractors should approach employment nondiscrimination risks and best practices when using AI in the context of the laws that OFCCP enforces.Continue Reading Office of Federal Contract Compliance Programs Releases New Guidance on the Use of Artificial Intelligence in Federal Contracting Employment Processes

On January 30, 2024, the Federal Acquisition Regulatory Council (“FAR Council”) proposed a new “Pay Equity and Transparency in Federal Contracting” rule for government contractors.  The proposed rule intends to increase race and gender equity for employees of federal prime contractors and subcontractors by prohibiting them from requesting and relying on certain information about job applicants’ compensation history and requiring contractors to disclose compensation rates in job announcements for certain positions.  These requirements would apply to all prime contracts and subcontracts – including for commercial products and services – where the principal place of performance is within the United States, regardless of dollar amount or tier.  The proposed rule is the latest in a number of steps the Biden Administration has taken to address discriminatory pay practices in federal procurement and contracting since announcing an Executive Order on Advancing Economy, Efficiency, and Effectiveness in Federal Contracting by Promoting Pay Equity and Transparency in March 2022. 

The proposed rule’s potential impact and implications for contractors — as well as opportunities to submit comments on the issue — are discussed below.Continue Reading New Proposed Rule on Pay Equity and Transparency in Federal Contracting

The requirement to pay “prevailing wages” to covered workers is a perennial aspect of many types of government contracting, including construction contracts subject to the Davis-Bacon Act (“DBA”) and certain related laws (collectively referred to as the Davis-Bacon and Related Acts or “DBRA”).  In recent years, Congress has also expanded the reach of prevailing wage requirements to new industries: clean energy projects seeking to take advantage of federal tax credits under the Inflation Reduction Act are required to ensure that prevailing wages are paid or may be forced to forfeit valuable credits.  Semiconductor manufacturers — as well as manufacturers of materials and equipment used to make semiconductors — that seek to take advantage of the incentives established by the CHIPS Act are likewise required to follow the prevailing wage requirements of the DBA. 

It was in this context that the Department of Labor (“DOL”) introduced a 222-page final rule, “Updating the Davis-Bacon and Related Acts Regulations,” that substantially rewrote the implementing regulations under the DBRA.  Among other things, the final rule alters how DOL calculates the prevailing wage rates for each locality, and expands the definition of the “site of work” and categories of workers subject to the DBA.  Moreover, the final rule imposes the DBA by operation of law on federal construction contracts that would otherwise be covered, but that nevertheless do not include the requisite FAR clauses and wage determinations used to inform contractors of the DBA’s requirements.  The potential impact of these changes has not gone unnoticed:  last month, two trade associations — the Associated Builders and Contractors of Southeast Texas, Inc. (“ABCSETX”) and the Associated General Contractors of America (“AGC”) — filed separate suits challenging multiple aspects of the final rule, including the changes to prevailing wage calculation methodology and the revised definition of the site of work.  We expand on the final rule’s changes — and on the pending legal challenges — below. Continue Reading Whose Site Is It Anyway: Trade Groups Challenge DOL’s Prevailing Wage Calculation and Expanded Definition of the Site of Work Under the Davis-Bacon Act

UPDATED AS OF 10/26/2022:

Changing course after its August 31 announcement that it would not enforce the federal government contractor vaccination mandate absent further written notice, on October 14, 2022, OMB and the Task Force published an update stating that they plan to issue at least three new guidance documents with an eye toward potentially resuming enforcement of the mandate:

  1. First, OMB plans to notify Federal agencies about compliance with applicable injunctions and whether contract clauses implementing the mandate should be included in new solicitations and contracts.
  • Second, the Task Force plans to update its November 2021 workplace safety protocols guidance related to the mandate.  The updated guidance will provide a timeline for any implementation long enough to ensure that covered contractors can come into compliance as needed.
  • Third, OMB will review the safety protocols guidance and make a determination on whether it promotes economy and efficiency in government contracting.  If OMB makes such a determination, it will provide additional guidance to agencies on timing and considerations for providing written notice to contractors regarding enforcement, except as barred by any injunction.

Continue Reading OMB and Safer Federal Workforce Task Force Preview Forthcoming Guidance on Federal Contractor Vaccine Mandate

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