Washington D.C. Employment Law Update : Washington D.C. Employment Lawyer & Attorney : Littler Mendelson Law Firm : Virginia, Tyson's Corner

Among other things, the EO calls for flexible approaches to regulations. “Where relevant, feasible, and consistent with regulatory objectives, and to the extent permitted by law, each agency shall consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public.” To that end, the EO requires agencies to review existing regulations and modify, streamline, or repeal rules that are outmoded, ineffective, insufficient or excessively burdensome. Agencies must submit a preliminary plan for such review within 120 days.

Although the EO does not reference any particular regulation, the EO could lead to a re-examination of a number of rules impacting employers. For example, the call for “flexible approaches” and review of outdated regulations may lend support to efforts to amend wage and hour rules to promote workplace flexibility. The review may also prompt greater scrutiny of the economic impact of proposed workplace safety and health regulations.

In conjunction with the EO, the President issued a memorandum on regulatory flexibility, small business and job creation. Specifically, the memo directs the heads of executive agencies and departments “to give serious consideration to whether and how it is appropriate, consistent with law and regulatory objectives, to reduce regulatory burdens on small businesses, through increased flexibility” when initiating rulemaking that will have a significant economic impact on a substantial number of small entities. The memo explains that this flexibility can be in the form of:

• extended compliance dates that take into account the resources available to small entities;
• performance standards rather than design standards;
• simplification of reporting and compliance requirements (as, for example, through streamlined forms and electronic filing options);
• different requirements for large and small firms; and
• partial or total exemptions.

If such flexibility in formulating a final rule is not shown under these circumstances, the memo explains that the agency is to “explicitly justify its decision not to do so in the explanation that accompanies that proposed or final rule.”

The President issued a separate memorandum on regulatory guidance and enforcement. The memo requires federal enforcement agencies to make publicly available compliance and enforcement activities accessible, downloadable, and searchable online. In addition to greater agency disclosure of compliance and enforcement data to the public, the memo seeks to enhance sharing of such data among agencies.

As evidenced by the Department of Labor’s and Equal Employment Opportunity Commission’s Fall 2010 regulatory agendas and the National Labor Relations Board proposed notice-posting rule, employers are facing an active labor and employment regulatory agenda. This upcoming rulemaking activity impacting the workplace will demonstrate whether and how today’s EO will, in fact, alter the Administration’s regulatory strategy.

This order revokes Executive Order 13204, issued by former President Bush on February 17, 2001, which in turn had rescinded former President Clinton-era Executive Order 12933 implementing the displaced worker policy in the first instance. Obama’s order effectively reinstates Clinton’s.

According to the NPRM, the DOL proposes to implement the current Executive Order with regulations based on similar requirements to those issued under the Clinton Order, but recognizes that the current Order is broader in scope as to the types of service contracts covered. Therefore, the NPRM provides a section-by-section discussion of the proposed rule, highlighting significant differences between this proposal and the prior regulations issued under the Clinton Order.

Notably, the current Executive Order covers all contracts covered by the Service Contract Act (SCA) above the simplified acquisition threshold (currently $100,000). The Clinton Order was limited to building services contracts in excess of the simplified acquisition threshold for maintenance of public buildings. Moreover, exemptions listed for, among other entities, the U.S. Postal Service, NASA, military, and Veterans Administration installations in the Clinton Order have been eliminated.

In addition, while both the current and Clinton Orders establish a federal policy for successor contractors to offer employment in most cases to the employees on the predecessor contract when the new contract award would otherwise displace those workers, the regulations covering the Obama Order would be written in the customary format, as opposed to the question and answer format for the Clinton Order. The current regulations also propose minor modifications to the enforcement and administrative procedures to clarify responsibilities of various federal officials, which was not included in the prior rule.

Also, the current proposed rules would add a definition of managerial and supervisory employee. The general policy stated in section 1 of the current Order and in the contract clause parenthetically excludes managerial and supervisory employees from its requirements, but does not define these terms, nor did the regulations implementing the Clinton Order.

The Obama Executive Order requires contractors to include in their contracts with subcontractors provisions requiring that the subcontractor agree to the nondisplacement provisions with respect to their own employees. Contracts below the simplified acquisition threshold of $100,000 are excluded under the Order. The DOL interprets this exclusion for subcontracts, even when the prime contract is for a greater amount. However, the covered prime contractor or higher tier subcontractor would still have to comply with these nondisplacement requirements. If a covered contractor subject to the nondisplacement requirements were to discontinue the services of a subcontractor at any time during the contract and perform those services itself at the same location, the contractor would have to offer employment to the subcontractor's employees who would otherwise be displaced and would otherwise be qualified but for the size of the subcontract. The DOL notes the Clinton Order excluded prime contracts under the simplified acquisition threshold and therefore did not mention subcontracts in the regulations.

The DOL further explains that proposed contract clause paragraph (g) requires the contractor to maintain certain records to demonstrate compliance with the nondisplacement requirements. The NPRM notes that this proposed paragraph was not included in the prior regulations.

Comments to this proposed rule must be submitted on or before May 18, 2010, and include the Regulatory Identification Number (RIN) 1235-AA02. Written comments may be sent to Regulatory Analysis Branch, Wage and Hour Division, U.S. Department of Labor, Room S-3502, 200 Constitution Avenue, NW., Washington, DC 20210. Alternatively, comments may be submitted electronically through the federal eRulemaking Portal: http://www.regulations.gov. 

Photo credit:   style-photographs
 

The first part of the proposed rule includes definitions, prescribes requirements for the size, form and content of the notice, exceptions for certain types of contracts, and exemptions. Notably, the DOL explains that instead of including a simplified list of employee protections under federal labor law or copying the language used in Section 7 of the NLRA outlining an employee’s rights, the proposed notice contains “greater detail of NLRA rights, derived from Board or court decisions, implementing such rights – which will more effectively convey such rights to employees.” In addition, the proposed notice provides National Labor Relations Board (NLRB) contact information, instructions on how to file a charge with that agency, and points out the 6-month statute of limitations for lodging a complaint. The DOL invites comment on this detailed statement of employee rights, and requests input on whether any provisions should be added or deleted. The DOL also seeks comment on whether the employee notice clause in the contract, subcontract, or purchase order should be set out verbatim, rather than incorporated by reference to ensure that contractors are aware of their obligations to post the required notice.

With respect to subcontractors, the proposed rule explains that the DOL has broadly interpreted the language in the EO, and therefore proposes that the obligation to post notices of employee rights extends beyond first tier subcontractors. In addition, the DOL notes that while the EO exempts from the notice obligations contracts involving purchases below the simplified acquisition threshold ($100,000), it does not exempt subcontracts involving purchases below this threshold. In the definitions section of the proposed rule, however, the DOL defines “subcontract” as only those subcontracts that are necessary to the performance of the government contract. Thus, the proposed rule notes, “[a]lthough this rule may result in coverage of subcontractors with relatively de minimis value in the overall scheme of government contracts, covered subcontractors include only those who are performing subcontracts that are necessary to the performance of the prime contract.” The DOL seeks comment on whether and in what form further limitations for subcontractor coverage are needed.

As for the physical posting of the notice, the DOL states that if a contractor customarily posts notices to employees electronically, it must do the same for the new employee rights notice. The DOL has proposed that a contractor may satisfy this obligation by posting the notice to its internal or external website, which must also prominently display a link to the DOL’s website containing the full text of the employee notice. The content of the notice must also link to the DOL’s web page. The DOL invites comment on whether it should prescribe standards regarding the size, clarity, location, and brightness of this link.

The second part of the proposed rule outlines the standards and procedures related to complaints, compliance evaluations and enforcement. Penalties for violations include contract cancellation, termination or suspension. In addition, the Labor Secretary may issue an order debarring the contractor “until such contractor has satisfied the Secretary that such contractor has complied with and will carry out the provisions of the order.” Written complaints can be sent to either the Office of Federal Contract Compliance (OFCCP) or the Office of Labor Management Standards (OLMS). The OFCCP would have investigative authority.

All comments on this proposed rule must contain the identification number: 1215-AB70, and be received by September 2, 2009. Written comments may be sent to Denise M. Boucher, Director of the Office of Policy, Reports and Disclosure, Office of Labor-Management Standards, U.S. Department of Labor, 200 Constitution Avenue, N.W., Room N–5609, Washington, DC 20210. Comments may also be sent electronically through the Federal eRulemaking Portal at http://www.regulations.gov.
 

In awarding any contract in connection with a large-scale construction project, or obligating funds pursuant to such a contract, executive agencies may, on a project-by-project basis, require the use of a project labor agreement by a contractor where use of such an agreement will (i) advance the Federal Government's interest in achieving economy and efficiency in Federal procurement, producing labor-management stability, and ensuring compliance with laws and regulations governing safety and health, equal employment opportunity, labor and employment standards, and other matters, and (ii) be consistent with law.

To this end, the proposed rule amends the current Federal Acquisition Regulation (FAR) by doing the following:

• Provides a new FAR Subpart 22.5 entitled: Use of Project Labor Agreements for Federal Construction Projects. This subpart defines a “large-scale construction project” as one costing $25 million or more. It also includes general requirements for PLAs, and specifies that if an agency decides to require a PLA, a Notice of Requirement for Project Labor Agreement must be included in all solicitations associated with the construction project, and a PLA clause must be included in all contracts associated with the project. If an agency allows the submission of a PLA after the contract has been awarded, this section directs the contracting officer to use an alternate Notice and PLA clause, as provided in the regulations.
• Adds a new provision at 52.222–XX, Notice of Requirement for Project Labor Agreement, which must be included in solicitations where the agency has exercised its discretion to require a PLA. An alternate notice is also included for use when the agency allows the submission of a PLA after the contract has been awarded.
• Add a new clause 52.222–YY, Project Labor Agreement, to be included in contracts associated with the project at issue. An alternate contract clause is also provided in the event the PLA is submitted after the contract has been awarded.

Although comments may be made about any aspect of these changes, the Councils are particularly interested in comments related to the process, such as whether agencies should require the submission of a PLA prior to the contract award from each offeror as part of their bid, or from a successful offeror only. Additionally, the Notice of Proposed Rulemaking states that the Councils are “considering factors for the contracting officer to consider, on a project-by-project basis, in determining whether use of a project labor agreement will be in the best interest of the Government,” and therefore invite public comment on the factors that should be considered, such as the difficulty of coordinating multiple contracts in the absence of a project labor agreement, and the importance of timely project completion.

Comments on this proposed rule may be sent by mail to:  General Services Administration, Regulatory Secretariat (VPR), 1800 F Street, NW., Room 4041, ATTN: Hada Flowers, Washington, DC 20405, or via fax to 202-501-4067, and must be received by August 13, 2009. In the alternative, comments can be submitted electronically at Regulations.gov.  The FAR Case number 2009-005 must be included with any comments.
 

Immigration

The Senate approved a modified amendment to the stimulus bill that would substantially limit employers that receive Troubled Asset Relief Program (TARP) funds from hiring employees who hold H-1B work visas. The Save Our Small and Seasonal Businesses Act of 2009 (S. 388), on the other hand, would extend by three years the hiring cap exemption for returning H-2B guest workers. In other immigration news, the Loophole Elimination and Verification Enforcement Act (H.R. 994) was introduced. This bill would, among other things, mandate that all employers use the E-Verify program.

Labor/Management Relations

President Obama signed another labor-friendly executive order encouraging the use of project labor agreements.

Workplace Flexibility

The Airline Flight Crew Family and Medical Leave Act (H.R. 912), passed by the House this week, would close a Family and Medical Leave Act (FMLA) loophole for airline pilots and flight attendants by changing the hours of service requirements.  In other FMLA news, the Family and Medical Leave Enhancement Act of 2009 (H.R. 824) would amend the FMLA to allow employees to take parental involvement or family wellness leave.

The Family-Friendly Workplace Act (H.R. 933) was reintroduced this week. This bill would amend the Fair Labor Standards Act to permit private-sector employees to chose compensatory time off (“comp time”) in lieu of case wages for overtime hours worked.

Workplace Safety

The Worker Protection Against Combustible Dust Explosions and Fires Act (CDEFA) (H.R. 849) was introduced. This bill would regulate combustible dust exposure at industrial sites.