March 27, 2017
We previously updated you on an Obama administration rule requiring contractors to disclose violations of 14 different labor laws in the prior three years for consideration by contracting officers in making decisions to award or extend a contract. In addition to reporting labor law violations, the rule also required contractors to abstain from entering into pre-dispute arbitration agreements with employees that cover Title VII or tort-based sexual harassment/assault claims and to provide wage statements and notice to workers on covered contracts each pay period so workers can verify the accuracy of what they are paid (the “paycheck transparency” provision). The rule requirements were set forth in FAR 52.222-59, FAR 52.222-60 and FAR 52.222-61. With swift Congressional votes and a stroke of the pen, the entire rule is now dead.
The rule had been on the ropes since October 2016, when a federal district judge enjoined agencies from implementing the “labor law violations” disclosure requirement (FAR 52.222-59) and the prohibition on pre-dispute arbitration agreements (FAR 52.222-61). The paycheck transparency provisions were not enjoined and went into effect on Jan. 1, 2017. Going forward, contractors no longer need to comply with the paycheck transparency requirements in FAR § 52.222-60 either.
To repeal the rule, Congress utilized the two decades-old Congressional Review Act (“CRA”), a law giving an incoming Congress 60 working days to disapprove regulations made final in the last 60 “session” days in the Senate or the last 60 “legislative” days in the House of Representatives. All that remained after Congressional voting was a signature by the President, which happened today.
The Congressional Research Service estimated in December 2016 that rules made final after June 13, 2016, would be subject to scrutiny by the 115th Congress. Using this estimated date, other prominent government contracting final rules that could be on the new Congress’s chopping block via the CRA include:
- Expansion of Small Business Mentor Protégé Programs (published July 25, 2016)
- Paid Sick Leave (published Sept. 30, 2016)
- Reporting of Reduced or Untimely Payments to Small Business Subcontractors (published Dec. 20, 2016)
Stay tuned for updates on the possible repeal of these or other recently published rules.