In an Executive Order issued yesterday, President Trump revoked Obama-Era Executive Order 13495, which provided some protection – a right of first refusal for continued employment – to qualified service workers when a government contract was replaced with a new contract and successor contractor at the same location.  President Trump’s Executive Order provides no explanation for the revocation, but the move was likely influenced by the new Secretary of Labor, Eugene Scalia.

Executive Order (EO) 13495 and its implementing regulations, applied to any contract or subcontract for services entered into by the Federal Government or its contractors covered by the McNamara-O’Hara Service Contract Act.  It required that qualified workers (non-exempt workers covered by the SCA’s requirements) on a covered contract who stood to lose their jobs due to the completion or expiration of a contract be given a right of first refusal for employment with the successor contractor.  Generally, the successor contractor was prohibited from hiring any new employees under the successor contract until qualified workers performing the prior contact were provided the opportunity to accept a job with the successor.  However, EO 13495 applied only to successor contracts for the performance of the same or similar services at the same location.

The revoked Order required the predecessor contractor to provide written notice to eligible employees either via a conspicuous workplace posting or via notices delivered to the employees individually. Federal contractors are no longer required to post or provide any EO 13495 notices. Please note this revocation does not affect contractor obligations with respect compliance with Executive Order 13496.

President Trump’s Order requires the Labor Secretary and others to “promptly move to rescind any orders, rules, regulations, guidelines, programs, or policies implementing or enforcing Executive Order 13495.”  Significantly, the Order terminates immediately any existing investigations or compliance actions based on EO 13495.

You may recall the President has revoked other Executive Orders entered by President Obama, including the “Blacklisting” Order. and there may be more to come.

As anticipated, President Trump has put an end to Executive Order 13673 – Fair Pay & Safe Workplaces, also known as the “blacklisting” executive order.  As expected, the President signed legislation disapproving of the Executive Order pursuant to the Congressional Review Act.  He also issued an Executive Order officially revoking the initial authorizing Executive Order signed by President Obama. President Trump’s Order directs the Department of Labor and other executive agencies to “consider promptly rescinding any orders, rules, regulations, guidance, guidelines, or policies implementing or enforcing the revoked Executive Orders.”

With the underlying authorization for the regulations eliminated, this spells the end for the Executive Order as well as the DOL Guidance and the FAR provisions implementing the Blacklisting Rule.  The end result – federal contractors will not be required to report alleged labor violations to federal agencies as part of the bid process, are not required to implement procedures to comply with required paycheck transparency, and will not be prohibited from entering into mandatory arbitration agreements concerning employee Title VII claims.

 

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At a ceremony in Wisconsin this week, President Trump signed yet another executive order, this one entitled, “Buy American and Hire American.”

What does this mean for federal contractors?  It’s not exactly clear at this point, but as our colleagues have previously discussed, the “hire American” portion of the President’s latest Executive Order is focused on revamping the H-1B visa program.  This will impact the make-up of employers employee populations for those contractors who rely on the program to help meet their staffing needs.  As a result, the executive order could possibly necessitate a change to recruiting strategies for contractors.

To be prepared, contractors should start planning ahead and working with their recruiting teams to develop strategies for recruiting and filling open positions going forward.  This is also an opportunity to revisit and bolster your good faith outreach programs to address staffing needs.