The U.S. Department of Labor (DOL) Secretary Marty Walsh and White House Office of Management and Budget (OMB) Director Shalanda Young issued a joint memo to the heads of executive departments and agencies directing them to designate “labor advisors.” The purpose of the labor advisors is to assist in the strengthening of implementation and review of Federal contract labor and employment practices based on recommendations from the White House Task Force on Worker Organizing and Empowerment (Task Force).
In particular, the memo states: “Labor advisors can be a valuable resource to the Federal acquisition workforce, including program officials whose projects are supported by Federal contractors, by helping to ensure the goals of labor laws and implementing regulations and policies are being met by their contractors. Labor advisors can promote Federal workforce understanding of longstanding labor laws, such as the Service Contract Act (SCA) and the Fair Labor Standards Act (FLSA), and nondiscrimination and affirmative action requirements such as those in Executive Order (E.O.) 11246.”
FAR Part 22 contemplates the appointment of "agency labor advisors," and requires contractors to contact them about potential labor disputes or questions; however, DOL and OMB found not all agencies have such a role.
What would labor advisors do? “FAR § 22.001 defines the term ‘agency labor advisor’ as an individual responsible for advising contracting agency officials on Federal contract labor matters. The FAR makes specific reference to agency labor advisors in carrying out or supporting certain activities. For example, FAR 22.1003-7 requires the contracting officer to request the advice of the agency labor advisor in addressing questions concerning the applicability of the Service Contract Act. FAR 22.1013 requires the contracting officer to contact the agency labor advisor to consider requesting a hearing at DOL’s Wage and Hour Division if wages, fringe benefits, or periodic increases provided for in a collective bargaining agreement vary substantially from those prevailing for similar services in the locality.”
Labor advisors must be in place no later than February 15, 2023. The DOL intends to publicize the name of each agency’s labor advisor(s) on its website and on the System for Award Management (SAM.gov) as a resource for contracting agencies and the public.
The last time labor advisors were “attempted” was during the Obama Administration that tried to promulgate the “Blacklisting Regulations.” Federal contractors or subcontractors who violated a series of federal and state employment laws were going to be “blacklisted” from federal contracts or debarred from current ones. The rule was struck down by a Texas court and was not reinstated. More recently, the Department of Agriculture tried to promulgate a similar blacklisting rule, but the rule after a number of comments is still sitting with OMB.
So, what does this mean for federal contractors? More close looks at compliance by the contracting officer through the labor advisor whether its OSHA or wage and hour or EEOC charges or OFCCP audits or other law. Pressure may be put on the contractor to settle if there is an issue, even if not in wrong, to assure that they get the contract or can continue working on the contract – a backdoor way to “blacklist” or “legally extort” the federal contractor. In addition, they may start reviewing compliance with the subs on any project by requiring the contractor to confirm such compliance. Therefore, internal compliance officers of contractors will be lifting a heavy burden and will be even more important to the federal contractor business.
If contracting officers through labor advisors stop contract awards due to perceived “noncompliance,” there will likely be lawsuits and lawsuits. However, federal contractors and their subs must recognize that compliance is a high priority for the current administration.
Source: Crowell Moring 1/17/23, Law360 1/11/23