Federal Contractor Update
There are lots of Federal Contractor odds and ends to discuss since President Trump’s inauguration. Let’s get caught up!
Trump Signs Executive Order to Roll Back Regulations
In late January 2017, President Trump signed an Executive Order to eliminate two federal regulations for every one regulation enacted. Given the numerous regulations and obligations added during the Obama administration related to federal contractors, this Executive Order has the potential to change the compliance landscape.
Fair Pay & Safe Workplaces Rule Is Dead
On March 5, 2017, pursuant to the Congressional Review Act (“CRA”), the U.S. Senate passed a Joint Resolution disapproving (and therefore rescinding) the “Blacklisting” rules under President Obama’s Fair Pay and Safe Workplaces Executive Order (Executive Order 13673). President Trump subsequently signed the resolution on March 27, 2017.
At the same time he signed the Joint Resolution, Trump also issued an “Executive Order on the Revocation of Federal Contracting Executive Orders.” This Executive Order basically stripped the legal foundation for the Blacklisting rules.
Because the Blacklisting law was rescinded pursuant to the CRA, any similar rules proposed by future administrations would require congressional action to move forward.
This is good news for contractors who bid on high dollar contracts. If you remember, the Executive Order required covered contractors to disclose certain “labor law violations” to the DOL when bidding on a federal contract. In October, a U.S. District Court issued a preliminary injunction blocking the implementation of this disclosure requirement.
If you recall, however, the Court’s injunction did not prevent the paycheck transparency and anti-arbitration requirements of the original Fair Pay And Safe Workplaces rule from going into effect. Congress’s Joint Resolution (with Trump’s forthcoming signature), however, also eliminates these obligations. As a reminder, the paycheck transparency rules required contractors to provide all employees performing work under the contract, in each pay period, with information related to their wages, hours worked, overtime, and any additions/deductions made to pay. It also required contractors who use independent contractors to perform work on the federal contract to provide them with written notice of their independent contractor status before they perform work in the contract. Those notices are no longer required.
Keep in mind, however, that the “paycheck transparency rules” that have now been disapproved by Congress, and the “pay transparency rules” which went into effect on January 2016, are different laws, and contractors must continue to comply with their pay transparency obligations. See more on the “pay transparency rules” immediately below.
Pay Transparency Rules Revised
Speaking of the “pay transparency” obligations, the OFCCP recently updated the rule. If you remember, Executive Order 13665 prohibits contractors from preventing, disciplining, or terminating an individual for discussing wage information. It also required contractors to incorporate specific language into Employee Handbooks and post the language for view by applicants and employees.
In early March, the OFCCP issued a non-substantive revision that requires contractors to add a citation to the end of the notice in Handbooks and other postings. Two versions of the provision are available on the OFCCP’s website—one with a formatted version with the OFCCP’s logo is available here, and another without the logo is available here. Please make sure to revise any reference to the notice accordingly.
OFCCP’s Disability Self-Identification Form Renewed
In February, the OFCCP renewed the form contractors must use when asking applicants and employees to self-identify whether they have a disability. No substantive changes were made to the form other than the new expiration date (January 31, 2020).
Despite the fact that the form is otherwise the same, contractors must make sure to update their forms to include the form with the updated expiration date. You can access the new form here.
LGBT Protections For Federal Contractors Remain Intact
If you remember, on July 21, 2014, President Obama signed Executive Order 13672 extending workplace protections to lesbian, gay, bisexual and transgender (“LGBT”) Americans in the federal contracting workforce. The requirements did not require contractors to collect data on, or even take affirmative action in the employment of, LGBT individuals. Rather, the provisions merely required non-discrimination.
When President Trump was elected, speculation grew that he would roll back Obama’s LGBT protections for federal contractors. Shortly after his inauguration, however, President Trump put to rest such speculation and indicated that the protections would remain intact.
On March 16, 2017, President Trump announced his budget for the DOL. It calls for a $2.5 billion cut in the DOL’s overall budget, which likely means the DOL’s OFCCP will also see budget cuts. These potential cuts open the door to the possibility that OFCCP audits of affirmative action compliance may not be as extensive as under the prior administration. With that said, the 21 percent reduction in funding is for the entire DOL, with no indication as of yet how that will affect the sub-agencies.
New Veterans Hiring Benchmark Announced
On March 31, 2017, the OFCCP announced that the 2017 Annual Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) hiring benchmark will be 6.7 percent, down from 6.9 percent. Contractors who adopted the previous year’s national benchmark of 6.9 percent after March 4, 2016, but prior to this announcement, may keep their benchmark at 6.9 percent.