Should a Rule Requiring Federal Contractors to Disclose Their Labor Law Violations be Repealed? (H. Joint Res. 37)

What is H. Joint Res. 37?

(Updated June 24, 2020)

This bill was enacted on March 27, 2017

This resolution would overturn a regulation that requires prospective federal contractors to disclose alleged and actual labor law violations, and creates labor compliance advisors to direct federal agencies about how to consider those violations when awarding contracts. The rule was created by President Obama’s Executive Order 13673 and was finalized on August 25, 2016.

The rule was aimed at promoting compliance among federal contractors with labor laws to ensure “safe, healthy, fair, and effective workplaces” because of concerns that serious, alleged labor violations weren’t being considering by the federal government’s contracting officers. It applies to all contracts over $500,000. Additionally, it imposes a requirement on contractors to maintain wage records, and requires that contracts include clauses allowing employees to voluntarily consent to going through arbitration. Federal agencies could debar contractors that have severely or repeatedly violate labor laws, meaning that they’d no longer be eligible to receive federal contracts.

Under the Congressional Review Act, Congress is able to overturn regulations finalized within the last 60 legislative days with simple majority votes on a joint resolution of disapproval in both chambers and the president’s signature. CRA resolutions also prevent the federal agency that created the regulation from issuing a similar rule without being directed to do so by Congress.

Argument in favor

The Obama administration’s rule went too far by blacklisting contractors on the basis of unproven allegations, thus forcing tax dollars to be spent on less qualified contractors.

Argument opposed

The federal government should avoid doing business with companies that violate labor laws and cut corners with safety. The Obama administration’s rule helped accomplish that.

Impact

Federal contractors; and federal agencies.

Cost of H. Joint Res. 37

A CBO cost estimate is unavailable.

Additional Info

In-Depth: The chairman of the House Small Business Committee, Rep. Steve Chabot (R-OH) said the Obama administration’s rule is needs to be overturned to help small businesses:

“The blacklisting rule will force innocent small businesses to settle unproven claims, disclose commercially sensitive information to their competitors, and report information the federal government already has.”

Rep. Elijah Cummings (D-MD) expressed his opposition to the bill, saying that by repealing the rule “Congress will be putting employees of federal contractors at greater risk of wage theft or unsafe working conditions.”

This legislation has the support of 17 cosponsors in the House, all of whom are Republicans.

Media:

• Republican Policy Committee
  
• Government Executive
  
• The Hill