Georgia Tech Procurement Assistance Center

President puts last nail in coffin to eliminate ‘blacklisting’ rule for federal contractors

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President Donald Trump on Monday signed a joint resolution shutting down an Obama administration-era rule that supporters said evened the playing field for law-abiding contractors, but which the current administration said amounted to “blacklisting” easy targets.

House Joint Resolution 37 stated that Congress “disapproves” the Fair Pay and Safe Workplaces rule  and “such rule shall have no force or effect.”

H.J. Res. 37 was part of a package of resolutions signed March 27 by President Trump, which “roll back job killing rules,” said White House Press Secretary Sean Spicer during a press briefing earlier in the day.

Keep reading this article at: http://federalnewsradio.com/industryassociations/2017/03/trump-signs-joint-resolution-to-roll-back-blacklisting-rule-for-federal-contractors/

Contractors applaud House vote to kill fair pay, safe workplace rule

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Two major contracting groups hailed House passage on Thursday (Feb. 2, 2017) of a long-expected resolution to undo the Obama administration’s 2014 “Fair Pay and Safe Workplaces” order requiring contractors to report past violations of 14 labor laws.

House joint resolution 37, sponsored by Rep. Virginia Foxx, R-N.C., declares that the implementation rule submitted in August by the Defense Department, General Services Administration, and NASA relating to the Federal Acquisition Regulation (FAR) has no effect.

It passed 236-187 amid a series of votes using the 1996 Congressional Review Act to nullify regulations enacted in the past 60 days. (Other rules involved streams protection, land management royalties and Social Security rules on gun purchase background checks for people with mental disabilities.)

“We welcome the House action,” said David Berteau, president and CEO of the 400-member Professional Services Council, in a statement. “The blacklisting rule fails to provide companies with basic due process, imposes significant new and non-value added reporting requirements, and risks denying federal buyers access to the best private-sector providers to meet government needs. With the disapproval of this rule by the House, and we hope with prompt action by the Senate and then signature by the president, a significant overhang will be removed from the acquisition process.”

Keep reading this article at: http://www.govexec.com/contracting/2017/02/contractors-applaud-house-vote-kill-obama-fair-pay-safe-workplace-rule/135140

New guidance on contractor risk management under the human trafficking rule released

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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.

human-trafficking-united-nations
Source: United Nations Office of Drugs and Crime

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 (FAR).”

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.

Keep reading this article at: https://www.insidegovernmentcontracts.com/2016/12/new-guidance-contractor-risk-management-human-trafficking-rule-released/

Court of Appeals affirms lengthy prison sentences for men engaging in DBE fraud 

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The U.S. Attorney’s Office for the Middle District of Pennsylvania has announced that Joseph W. Nagle of Deerfield Beach, Florida and Ernest G. Fink, Jr. of Orwigsburg, Pennsylvania, the former owners of Schuylkill Products Inc., (SPI) had their sentences affirmed by the Third Circuit Court of Appeals.

Nagle was sentenced to 84 months’ imprisonment on November 30, 2015, and Fink was sentenced to 41 months’ imprisonment on February 24, 2016, for their roles in a massive conspiracy to defraud the U.S. Department of Transportation’s Disadvantage Enterprise (DBE) program.

According to USDOT, their scheme, which lasted for over 15 years and involved over $136 million in government contracts in Pennsylvania alone, is the largest reported DBE fraud in the nation’s history.

In April 2012, after a four-week jury trial, a jury convicted Nagle on 26 charges relating to the scheme, including conspiracy to defraud USDOT, mail fraud, wire fraud, and money laundering.  Fink previously pleaded guilty to conspiracy to defraud the USDOT in August 2010.

In 2014, three other former executives associated with SPI were sentenced for their roles in the scheme.

  • Romeo P. Cruz, of Westhaven, Connecticut, the former owner of Marikina Construction Corp., which operated as a front for SPI, was sentenced to 33 months’ imprisonment.
  • Timothy G. Hubler, of Ashland, Pennsylvania, SPI’s former Vice-President in charge of field operations, was sentenced to 33 months’ imprisonment.
  • Dennis F. Campbell, of Orwigsburg, Pennsylvania, SPI’s former Vice-President in charge of sales and marketing, was sentenced to 24 months’ imprisonment.

The investigation was conducted by the FBI, USDOT’s Inspector General’s Office, the U.S. Department of Labor Inspector General’s Office, and the Criminal Investigation Division of the IRS.

Source: https://www.justice.gov/usao-mdpa/pr/third-circuit-court-appeals-affirms-lengthy-prison-sentences-two-men-who-executed

 

‘Fair Pay, Safe Workplaces’ rule for federal contractors appears endangered

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DOLAmong the many Obama administration regulations that President-elect Trump plans to eviscerate could be the “Fair Pay and Safe Workplaces” rule the Labor Department finalized in August.

Labor’s goal was to protect workers against abuses such as wage theft and health violations by instituting additional disclosure and reporting requirements for federal contractors concerning their compliance with 14 labor laws. Industry viewed the impact as a burdensome “blacklisting” of contractors whose reputations, in some cases, could suffer from unproven allegations of past worker abuse.

In October, a Texas district judge issued a preliminary injunction blocking parts of the rule in response to a suit brought by a chapter of the Associated Builders and Contractors. The judge decided that the rule’s reporting requirements reach beyond executive authority and are otherwise preempted by federal labor laws. She left only the paycheck transparency provisions intact to take effect Jan. 1, 2017.

Keep reading this article at: http://www.govexec.com/contracting/2016/11/obamas-fair-pay-safe-workplaces-rule-federal-contractors-appears-endangered/133436

Bad-faith federal litigation tactics compel court to award small business attorneys’ fees

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Even though the federal government maintains an entire agency whose mission is purportedly to assist small businesses — the Small Business Administration (SBA) — regulators seem ever oblivious to their impact on entrepreneurs. The National Labor Relations Board’s (NLRB) effort to redefine who is an “employer” and the NLRB’s and the Department of Labor’s (DOL) enmity toward independent contracting are two current examples. A third is DOL’s so-called Fiduciary Rule, which hits sole-practitioner and small-business investment and insurance advisors especially hard.

Small businesses are also at a particular disadvantage when disputes with the government end up in court. A recent U.S. Court of Federal Claims decision, SUFI Network Services, Inc. v. US, exhibits government’s unfortunate willingness to exploit its power in disputes with a small business and the role courts can play in protecting entrepreneurs’ rights.

SUFI contracted with the U.S. Air Force (USAF) in 1996 to be the exclusive long-distance-call service provider for the guest lodging facilities on Air Force bases in Germany. Over the next 8 years, USAF personnel made it impossible for SUFI to successfully offer services.

For example, calling cards were provided to guests to circumvent SUFI’s service. Also, requests by SUFI that government phones be removed from the facilities were repeatedly ignored. SUFI declared that the USAF had committed a material breach of the contract and ceased services in August 2004. As required by the contract, SUFI filed a claim with its contracting officer for $130 million in damages. The officer awarded $133,000.

Obviously dissatisfied, SUFI appealed to the Armed Services Board of Contract Appeals (hereinafter, Board), increasing its request to $163 million.

Keep reading this article at: http://www.forbes.com/sites/wlf/2016/11/25/bad-faith-federal-litigation-tactics-compel-court-to-award-small-business-attorneys-fees/#14f0203f1f35

Implementation of Labor Department’s Dec. 1 overtime rule stopped

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DOLA Texas court has issued a nationwide preliminary injunction stopping implementation of the Department of Labor’s (DOL) rule to more than double the current salary threshold for certain exemptions from overtime pay.

The court ruled on November 22, just a few days before its December 1, 2016 implementation date.

The court ruling came in response to lawsuits filed by 21 states, the U.S. Chamber of Commerce, and other business groups.  The plaintiffs argued that the DOL exceeded its statutory authority in raising the salary threshold and by providing for the automatic adjustment of the threshold every three years.

  • The DOL rule would raise the salary threshold from $23,660 to $47,476 annually, more than doubling the minimum annual salary a worker can earn and qualify for an exemption from the overtime pay provisions of the Fair Labor Standards Act.
  • DOL’s rule would also adjust the threshold every three years based on the 40th percentile of wages for full-time salaried workers in the lowest wage earning geographic area captured by the U.S. Census.

The preliminary injunction issued by the court cites concerns that the rule improperly created a salary test that would consume Congressional intent that the exemption be based on the type of duties performed. Additionally, the court found merit in plaintiffs’ argument that states would be irreparably harmed by implementation of the rule before a final decision by the court because states facing budget restraints would have to expend a substantial sum of unrecoverable public funds to increase salaries or pay overtime to employees and may possibly have to layoff or reorganize workforces causing a substantial interference in government services.

A preliminary injunction is not permanent, but it does preserve the current rule while the court deliberates the merits of the case. As a result, the new rule will not take effect on December 1, 2016, and employers may continue to classify employees as exempt if they pay employees at least $23,660 annually on a salary basis and if the employees meet the appropriate duties test.

DOL’s rule could still become effective if the Texas court does not issue a permanent injunction or otherwise rule against the DOL.  The Labor Department is expected to challenge the ruling.

Because the preliminary injunction could be lifted on short notice, legal experts advise that employers should continue to prepare for changes called for in DOL’s rule.

Critical preparation considerations are discussed by the Piliero Mazza law firm at: http://www.pilieromazza.com/blog/far-reaching-impact-of-dols-increase-to-flsa-salary-thresholds

TX judge issues preliminary injunction blocking contentious Fair Pay and Safe Workplaces rule

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fpsw-rule-oct-2016The U.S. District Court for the Eastern District of Texas issued a preliminary injunction last week against the Fair Pay and Safe Workplaces rule, which opponents have dubbed the “blacklisting” rule.

The judge’s action blocks the Obama Administration’s regulation, which requires that contractors seeking federal work disclose recent labor law violations, from taking effect Oct. 25th, as originally scheduled.

In the decision, Judge Marcia A. Crone said the groups that initiated the suit earlier this month — including the Associated Builders and Contractors — had “properly demonstrated immediate and ongoing injury to their members if the rule is allowed to take effect,” according to Politico.

Read more here: http://www.constructiondive.com/news/tx-judge-issues-preliminary-injunction-blocking-contentious-fair-pay-and-sa/429005/ 

See Politico article here: http://www.politico.com/tipsheets/morning-shift/2016/10/texas-judge-blocks-contractor-rule-217046 

 

Contractors group files suit against ‘Fair Pay and Safe Workplaces’

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President Obama’s long-controversial Fair Pay and Safe Workplaces rule — set to take effect Oct. 25 — is being challenged in district court by the Associated Builders and Contractors (ABC), one of several contractors associations that oppose the rule as costly and burdensome.

DOLIn a suit filed Oct. 7 in the U.S. District Court for the Eastern District of Texas, the associated builders and its Southeast Texas Chapter argued that the Labor Department rule finalized in August and intended to protect low-wage workers from abuses such as wage theft is a “blacklisting” rule that forces contractors to report “alleged violations,” thus harming their prospects for winning government work.

“The Obama administration has exceeded its authority by forcing government contractors and prospective government contractors to publicly disclose mere accusations that they have violated labor and employment laws,” said Associated Builders and Contractors Vice President of Regulatory, Labor and State Affairs Ben Brubeck. “ABC supports policies that provide value to taxpayers by ensuring that federal contractors compete on a level playing field, but this rule will require contractors to report alleged violations that have not been fully adjudicated and are being contested, which violates their first amendment and due process rights and is likely to harm fair and open competition in the federal marketplace.”

Keep reading this article at: http://www.govexec.com/contracting/2016/10/contractors-group-files-suit-against-fair-pay-and-safe-workplaces/132243

5 steps to compliance with the fair pay and safe workplaces rules

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The much-anticipated so-called federal contractor “blacklisting” rules and guidance (“Final Rule” and “Guidance”) were published in the federal register on August 25, 2016. The Final Rule becomes effective on October 25, 2016 and imposes four new legal obligations on covered federal contractors, which will be phased in over the next year (starting as early as October 25, 2016).

It is important to also note that this is being phased in via Federal Acquisition Regulation (“FAR”) solicitation and contract provisions. This means that the Final Rule “becomes effective” by beginning to appear in new solicitations issued on or after October 25, 2016. This should not dampen a company’s concern and speed of progressing through the steps below and determining and pursuing compliance, but it is critical to understand and follow the specific path of obligation.

  • First, federal contractors will have to disclose “labor law decisions” both before and after contract award. The federal government will use these disclosures in making their “responsibility” determinations – the determination of whether the contractor is a responsible source to whom a contract may be awarded.
  • Second, contractors must give a wage statement to employees containing for each workweek the number of hours worked, the number of overtime hours, rate of pay, and additions to and from gross pay, and total gross pay.
  • Third, contractors must provide written notice to independent contractors informing them that they are independent contractors and not employees.
  • Fourth, contractors can no longer enter into agreements with employees or independent contractors that require arbitration of claims under Title VII of the Civil Rights Act (includes discrimination and retaliation claims based on race, color, religion, sex and national origin) or sexual harassment claims.

Federal contractors will need to become quick studies of the Final Rule and Guidance in order to begin developing procedures to ensure compliance as these requirements phase in over the next year.

Keep reading this article at: http://www.directemployers.org/2016/09/20/five-steps-compliance-fair-pay-safe-workplaces-final-rule/

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